update Telstra today announced it had signed an AU$85 million deal with the Australian Rail Track Corporation (ARTC) to develop a new communications system for the group's national rail network.

ARTC was created in the late 1990s, after federal and state governments agreed on the need for a single entity to control access to the nation's interstate rail network. The group manages over 10,000 kilometres of rail track in South Australia, Victoria, Western Australia and NSW.

According to ARTC chief executive David Marchant, the new system -- which will use Telstra's Next G mobile network -- will facilitate the safe movement of trains around the nation. It will allow all trains and train controllers on his group's network to use one system to communicate with each other, and provide real-time GPS tracking functionality.

The new system will replace a group of legacy technologies, such as two-way radios (UHF/VHF), that were previously used for internal rail network communications. Telstra will build some 77 new Next G base stations alongside rail tracks to facilitate communications.

"This rail network communications agreement that we've signed today ... will be the envy of rail networks in north America and Europe," Marchant told reporters in Sydney this morning. "There wouldn't be a continental rail company in the world who have a technology backbone as strong, as fast, as reliable, and covers the whole continent. The North Americans and the Europeans would die for it."

Marchant said ARTC evaluated the offerings of other telcos, but ended up picking Telstra for its unique nation-wide coverage. "There was nobody that could match the interconnectivity and footprint," he said.

The nitty-gritty
This morning's deal is actually composed of five contracts between ARTC and Telstra, covering not only construction of the new base stations, but also the manufacture and delivery of 700 train communication units; carrier services; lease arrangements whereby Telstra will lease the new base stations from ARTC; and an eight-year services and support contract.

The arrangement is a revamp of an existing deal with Telstra signed back by ARTC back in 2005. The previous arrangement was going to utilise Telstra's CDMA network, which is now slated to be switched off in 2008.

Telstra will manage ARTC's new communications system for eight years, and also provide satellite services to maintain train communications in case the Next G system goes down. This will ensure 99.98 percent system availability of the new system.

The federal government has made some funding available to support the new development of the new system through the AusLink National Transport Plan.

ARTC expects the system to be fully operational by June 2009.

Telstra's group managing director of its Enterprise and Government division David Thodey said a number of state railways were also looking at their options for various communications systems replacements.

Telstra will also use the new Next G base stations to provide mobile services to some remote communities that had not previously had 3G mobile coverage -- for example, Rawlinna (WA), Cook and Nackara (SA) and Loadstone and Telegraph Point (WA).