The inference that Soul, AAPT and TransACT were Dead Telcos Walking long before their withdrawals were announced makes me wonder whether Terria has always been, God help us all, just as flimsy a proposition as Telstra has made it out to be.
After months of rhetoric and enthusiastic chest-beating, Terria
is falling apart at the seams. Whether the company's executives are just
discouraged by the lacklustre economy or quietly packing their
suitcases for more investment-friendly climes, the group's members
are dropping faster than secondary characters in an Agatha Christie
mystery.
These two followed on from the 16 October
withdrawal by AAPT, which has decided its money is better spent
embedding U-SIM cards in New Zealand sheep. Or something like
that.
Once determined to be the pit bull Terria chewing on Telstra's
800-pound gorilla ankles, the Group Formerly Known as G9 is in full
damage control this week — as evidenced by its hasty rush to push
out a press release explicitly restating the support of the
remaining CEOs: Primus Telecom's Ravi Bhatia, Optus' Paul
O'Sullivan, Macquarie Telecom's David Tudehope, Internode's
Simon Hackett, and iiNet's Michael Malone.
All restated their "rock solid" support for the Terria
proposal, yet look elsewhere on ZDNet.com.au and there was Malone,
blasting what he called a "mindless political agenda that has
nothing to do with customers any more."
"The government has
everything shooting in the dark, with a clandestine expert panel
and a closed doors ministerial decision to decide everything," he said.
Ain't it the truth.
I wish it weren't, but my
column two weeks ago is more and more prescient every day:
analysts are now
ruminating on whether Senator Stephen Conroy should rightfully
suspend the NBN bid entirely. Optus isn't helping anything with
its ongoing 3G network dramas, and watching Terria waste away
before our eyes is even more distressing to those hoping the NBN
will bring about real change.
Bookmakers, grab your calculators. The way things are going for
Terria, by the time you read this, what was once the G9 — and is
currently the G5 — may well have knocked off a few more
recession-spooked carriers (watch out, guys — G1 is already
copyrighted by T-Mobile/HTC/Google, although I guess that would
just be Optus, now, wouldn't it?)
The geographic spread of the remaining Terria members still
gives the company a national footprint; they'll be leveraging
their respective geographical strengths to support and manage
Terria's nationwide wholesale operation — iiNet in WA, Internode
in SA and the NT, Macquarie in NSW, Primus in Victoria, and Optus
in NSW and Queensland (uh, wait a minute ...).
That makes sense, but the rapid attrition by once-committed
Terria supporters, not so much. If any other members drop
out, the whole house of cards could well collapse, leaving
Australia's broadband market at the mercy of Telstra and its
persistent demands for a vertical monopoly.
(I'm tipping Primus and
then Macquarie to go, if anybody's counting, because iiNet and
Internode will be fighting for purchase and blasting Telstra even
when the tip of the mast is the only part of the Terria ship still
sticking out of the water).
Conspiracy theorists, skip to here.
Reading between the lines paints a scarier picture. My warning
bells were flashing when Terria and TransACT released a
joint statement saying that "as the bid date drew closer it
had become apparent that it was in the interests of both companies
for TransACT to withdraw from Terria".
Here's the kicker: "This
will enable commercial negotiations between TransAct [sic] and
Terria to be conducted without any conflict of interest, either
real or perceived, among our respective directors."
Am I understanding this right? Terria doesn't want it to seem
like TransACT, which sells retail services in the ACT, would have
an unfair advantage in negotiations for access to Terria's
wholesale network?
If that's actually a real concern and not just poorly placed
spin, there's little hope for the other remaining members of
Terria either, since all of them also provide retail services and
would presumably face similar issues. This is doubly disturbing
because Optus has already conceded that the other Terria members
were mainly there to bolster the commercial viability for its bid;
yet, we are told, TransACT's withdrawal was coming for months.
The inference that Soul, AAPT and TransACT were Dead Telcos Walking long before their withdrawals were announced makes me wonder whether Terria has always been, God help us all, just as flimsy a proposition as Telstra has made it out to be.
"Mr Egan and Mr Mackay said this [withdrawal] was a
long-standing expectation by both companies," says the TransACT
press release. Looking at the release announced after Soul/TPG
withdrew, there's the statement that "Soul has not been an active
or contributing member of the consortium ... their announcement today
formalises what has been reality for a number of months."
And then there was AAPT chief executive Paul Broad
explaining the company's withdrawal by saying "we are at the
point where people have to put money into the bid process, and
we're not going to be doing that".
Such major decisions aren't made lightly, and the inference
that Soul/TPG, AAPT and TransACT were Dead Telcos Walking long
before their withdrawals were announced makes me wonder whether
Terria has always been — God help us all — just as flimsy a
proposition as Telstra has made it out to be.
Is it an alliance of truly committed infrastructure partners, or
just a group of fair-weather friends who are now amicably parting
ways because the world's economic woes don't make rebellion
financially attractive anymore?
Or — and the conspiracy theorists (and Telstra) will love this
one — were these departures always intended this way? Was Optus'
sole purpose with Terria to help Australia's major ISPs get access
to NBN information — including detailed Telstra network information
— with its partners, then send them off one by one to go build out
a complementary network by proxy as it submits its own Bid To Rule
Them All?
Could this be the real reason Optus
submitted its own bond? The head spins with the possibilities,
and I just wonder who else is going to chicken out of Terria before
the 26 November NBN submission deadline. More to the point, I
wonder who, having stuck around for sunrise on the 27th, will wish
they hadn't.
If Terria can't stop the attrition of its major partners, maybe
Optus should just pull the plug altogether and force the government
into some sort of sudden-death decision. After all, the government
couldn't possibly complete the tender process with just one
eleventh-hour submission from Telstra, resigning the country to a
lifetime of monopolistic price gouging.
