In a three part interview Business Spectator's KGB team of Alan Kohler, Robert Gottliebsen and Stephen Bartholomeusz discuss with the the three leading bidders about their proposals.

The first interview with Telstra chairman Donald McGauchie has him explaining:

  • The reason the telco put in a proposal, rather than a bid, saying unless it knows what the rules are, it cannot produce a bid that makes sense

  • He rejects the Terria bid, saying it cannot be described as such without concrete sources of funding and compares their situation to the 'glory days of Babcock & Brown

  • He launches a savage attack on the credentials of the Optus consortium's chairman Michael Egan

  • He rejects any suggestion of a single desk for telecommunications

  • Under Telstra's proposal, the lowest point at which people can get access is $29.95 retail price, with a one megabit capacity

The second interview with Terria chairman Michael Egan, former New South Wales treasurer:

  • The national broadband network (NBN) must be for the good of the country and not Telstra's bottom line, describing Telstra's targeted rate of return as 'exorbitant'.

  • Terria will not divulge the commercial arrangements of the bid, but it is confident that the funding is 'robust' and will be very attractive to the government

  • The consortium is basing its rates of return on infrastructure, in a similar model to utilities

The third interview with Acacia chairman, and former Telstra Countrywide boss, Doug Campbell:

  • There are about a dozen or so former Telstra employees involved in Acacia

  • On the involvement of Solomon Lew and Doug Shears, Campbell says they paid more than the bid bond, adding that they put money up to allow the team to come together to put this bid on the table

  • There's a risk, should Optus win the bidding process, that there will be a conflict between its retail and wholesale activities

  • While fibre-to-the-node forms the bulk of Acacia's bid, some of its services would be fibre-to-the-premise, right to the homes or businesses where the fibre does exist

  • Acacia is proposing to cover 100 per cent of the population

It is interesting that Acacia is now very much in the picture with the NBN. Two weeks ago the media and some telcos such as AAPT CEO Paul Broad, was suggesting it was a two horse race between Telstra and Terria and few gave any credence to the other players. I was the only one suggesting Acacia would be a strong contender.


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