commentary It is very interesting that when Telstra lodged its "proposal" for the national broadband network three weeks ago, chief executive Sol Trujillo was nowhere to be seen, but now that it has been ruled out, Trujillo is doing the briefings.
This gives some weight to industry rumours that the CEO didn't want to bid at all but was rolled by the board.
Whoever wins the right to build the fibre-to-the-node NBN will be held up by a High Court challenge from Telstra on every conceivable ground
When the proposal went in with 15 minutes to spare on 26 November, Sol Trujillo had left the country in a huff, according to those rumours, and left chairman Donald McGauchie to do the interviews and briefings.
Now that Telstra is not in the game and is merely heckling from the peanut gallery, Sol Trujillo is back as lead heckler. That would also explain why Telstra's bid was a total stuff-up.
Trujillo and McGauchie are saying today that the reason for excluding their bid — the lack of small business plan — was trivial, and so it was.
But if you're going to bid, you might as well do it properly. Telstra lodged something that it said was a proposal, not a bid, and there was much confusion around what it was exactly.
Communications Minister Stephen Conroy submitted it to the expert panel without reading it, saying that it was presented to him as a complying bid, but the fact that Telstra was mumbling that it was a "proposal" probably indicates that it knew all along that an important bit had been left out.
The only reason that makes any sense for not having a trivial small business plan in Telstra's bid is that management didn't prepare it. The board itself did it at the very last minute and didn't have the time or resources to do the small business part.
The other threshold requirements for a bid — that it's in English and that it's signed — were achievable. The small business plan would have taken a day or two of work by a Telstra team. Getting into a legal argument now about whether the government's Request For Proposals process actually required a small business plan or not would be utterly ridiculous and rather pathetic.
Sol Trujillo and Donald McGauchie are quite right: this process has a long way to run, and the bids that were due in by 26 November were really just opening gambits in what will be a long negotiation.
So why not stay in the process by doing a "trivial" small business plan? Because it was a stuff-up.
Anyway, it is great news for the government and the nation — not because Telstra won't be building the NBN, but that the national broadband network now won't get built at all for many years.
A long period of litigation now cannot be avoided. Whoever wins the right to build the fibre-to-the-node NBN will be held up by a High Court challenge from Telstra on every conceivable ground — leading off with a defence of its property rights against the requirement that its copper phone services be switched across to someone else's fibre within each node.
In the meantime we can keep getting relatively fast, competitive ADSL broadband from a full range of providers as well as wireless broadband from Telstra and Optus.
And the government can't get blamed for not delivering on its silly promise, because it won't be its fault. It's all good.
This article by Business Spectator's Alan Kohler is reproduced on ZDNet.com.au courtesy of a reciprocal publishing agreement.
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I respect Alan Kohler's insights (particularly in relation to Sol Trujillo's role in the RFP response), but I have to disagree with his conclusions. RFP's are very well understood instruments and Telstra knew that in submitting their twelve-page letter they were not, in fact, offering a proposal. The letter even explained why they were not submitting a proposal. So why they should be crying foul now that the letter has been declared non-compliant is a bit of a mystery. The board decided not to submit a proposal: end of story.
Where I disagree with Alan is in his conclusion that killing off the NBN is all good. The fact is that many Australian homes and businesses do NOT have access to fast ADSL2 services. Many are beyond the reach of ADSL or are stuck with RIM or pair-gain telephone wiring with the consequent abysmal data services. Secondly, we need to be starting on the next generation of infrastructure to provide support for new services and applications. As just one example, consider what a difference it would make if higher upload speeds were available. Cloud computing and off-premises backup become a whole lot more plausible when the upload speed is increased to something comparable to today's download speeds.