The company is targeting a reduction in its carbon emissions intensity, the amount of carbon emitted for every dollar earned, of at least 10 per cent, and up to 15 per cent, by 2015, Telstra said in a statement today.

"We are setting a realistic and achievable target for carbon intensity because we are serious about reducing our impact on the environment," chief executive David Thodey said. "Our customers, employees and the community increasingly expect us to act, and as the owner of infrastructure that is vulnerable to harsher climatic conditions it is in our interests to do so."

Telstra emitted 1.52 million tonnes of carbon dioxide equivalent in 2008/09, equivalent to 64 tonnes per million dollars of domestic revenue. The target requires Telstra to reduce this to at least 58 tonnes per million dollars by 2015.

The company would achieve the reduction by investing in energy efficient projects and accommodation, undertaking energy saving projects in existing facilities and decommissioning redundant assets.

Telstra also will train staff to reduce office and vehicle fleet emissions and use teleconferencing rather than travel for meetings. Thodey said the target took into account the larger energy requirements of the growing network and data storage facilities.

Traffic on the wireless Next G network was doubling every eight months, while traffic was doubling every 20 months on the fixed Next IP network, he said.

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• Carr launches new Aussie supercomputer
• CIO profile: Tony Clasquin of Bankwest
• NSW, Vic move on datacentres
• Atlassian: $10 products for charity

Despite the government having initially capped private investment in the company that will build and operate the NBN at 49 per cent, an Essential Research survey released this week showed 26 per cent of people believed Telstra would be in charge.

The figure is only slightly less than the 27 per cent of respondents who think the government will run the NBN.

It may be the case that Australia's largest telco does eventually assume ownership with the government intending to sell down its 51 per cent controlling interest in the company within five years after the network is built. The build is expected to take eight years.

Just six per cent of those surveyed believe Telstra's rival Optus, or another telco, will run the NBN. The survey comes as Telstra faces the separation of its wholesale and retail arms as part of sweeping reforms of the telco sector.

While the government maintains the reforms are about improving competition in the sector, it also desires Telstra assets to build the NBN.

Telstra chief financial officer John Stanhope recently said structural separation could be a "win-win" for shareholders and that the telco would consider selling assets to the NBN for cash.

The online survey of 1,043 people also showed that 65 per cent of respondents thought it was important the NBN was built, compared to 26 per cent who believed it was not important. Eight per cent of respondents said they did not know if Australia should have a high-speed broadband network.

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• Tasmania asks for help on NBN
• NBN Co banks with Westpac
• NBN Company hires CIO, govt chief
• Can not-so-smart meters help the NBN?

The supercomputer, jointly funded by the Australian National University, the CSIRO and the Federal Government, will be operated by National Computational Infrastructure. Director Lindsay Botten said the computer brought Australia's capability into line with the top systems around the world.

"This next generation research supercomputer will boost Australia's computational research capacity into world ranking," Professor Botten said.

It will provide 12 times the performance of its predecessor, placing it within the world's top 30-40 supercomputers. The new computer, known as the Vayu, is a Sun Microsystems Constellation class supercomputer and is due to be up and running at full capacity in December.

The Vayu, replacing the four-year-old and now obsolete SGI Altix 3700, is not your average desktop PC and has some impressive specs to go with its multi-million dollar price tag. "The Vayu contains 11,936 processing cores, so you can think of that as roughly 6,000 home PCs but a good deal more elaborate," Professor Botten told AAP.

"There is 36 terrabytes (one terrabyte equals 1000 gigabytes) of memory (RAM), that's roughly equivalent to 18,000 home PCs," he said. "The storage system is around 500-600 terrabytes once formated, but is more like a petabyte (one petabyte equals 1000 terrabytes) in its raw state, so you might see that as around 4,000 home PC hard drives."

Prof Botten said that meant the Vayu was capable of operating at 140 teraflops, which relates to the speed at which it makes so-called "floating point" calculations. This is a 10-fold increase on the Altix, which could only manage 14.

"That's 140 trillion multiplications every second," he said. "So to put that in context, imagine 20,000 calculations per second for every man, woman and child on the planet. "Or if you sat those six billion people down, gave them each a calculator and asked them to do a calculation that lasted seven years, this machine could do that in one day."

All those flops certainly require a lot of power with the Vayu sucking more than 600 kilowatts of power every moment it's switched on. That's roughly equivalent to 140 electric ovens running permanently, though Prof Botten says all power for the hungry machine will be sourced from green energy.

The CSIRO and the ANU each paid more than $3 million, for which they get about a quarter of the machine.

In keeping with the green theme, one of the Vayu's main uses will be helping to model climate change. "About 70 per cent of the work CSIRO have on their share will be in climate science," Prof Botten said. "The ANU will use its share across a wide variety of fields, a lot of physics, a lot of chemistry, a lot of computational biology and astronomy."

Alex Zelinsky, group executive of information sciences at the CSIRO, said the new computer would help Australian climate science get to the top levels of international research.

"The new facility will strengthen Australia's capacity to understand and respond to changes in the global climate system, as well as showcase the strength of Australia's top scientific research institutions," he said.

While the Vayu's specs may seem impressive, Prof Botten is already eying its replacement in 2011-12 and expects it to be about 12 times as powerful again, more than 280 trillion calculations per second.

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• ANU plans $50m supercomputer spend
• Uni of Melb cloud to water farms
• Meteorology building $30m supercomputer

Bruce Lakin
(Credit: Australian Computer Society)

Appointee Bruce Lakin has previously held the position of senior director Symantec Asia Pacific and Japan and has also been the managing director of VERITAS Software and general manager of Toshiba.

"Bruce is a leading ICT professional whose substantial industry experience and knowledge will make him an outstanding ambassador for the society and the profession. He has a strong background at a senior management level in running large IT organisations and possesses an excellent understanding of the challenges and opportunities that impact its Australian ICT professionals," ACS chairman Kumar Parakala said in a statement.

Parakala pointed out that Lakin had done a bevy of community service, being the assistant governor of a Rotary District and president of Pittwater Rotary Club. "His commitment to the community is commendable and is another reason why he was a stand-out candidate for the position," he said.

Lakin was pleased to take on the role, saying that the ACS was a strong voice for the profession. "My initial areas of focus will include public issues such as the National Broadband Network, Australia's Digital Economy, ICT skills development and careers, Green ICT and e-Security," he said.

AIIA chairman John Grant also welcomed the appointment. "Bruce is well known to many of our members," he said.

The former ACS CEO, Kim Denham, is in the midst of a court case against the Australian Computer Society. Denham alleges that she was entitled to more money than she received on termination and also says that the ACS had agreed to give her employment for at least three years to make it worthwhile to relocate. She was only with the society for around a year.

Sam Burrell, who had taken up the CEO mantle in acting capacity after Denham's departure, will return to his former position as ACS general manager Finance and Business Services.

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• ACS filter report just what Conroy needs
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David Bartlett
(Credit: Tasmanian Government)

"We want to broaden our thinking on the benefits these initiatives can create by working with the ICT industry," Tasmanian Premier David Bartlett said in a statement.

The state's Department of Education is asking its current hardware and software suppliers as well as the broader industry about potential technologies and services which will enable the NBN and new student computers to be as useful as possible.

"With the implementation of the National Broadband Network there is potential to look at the way we provide education services in a different way," Bartlett said.

Students could further their studies without leaving remote areas and could collaborate with other students via video conferencing, he said.

The new computers being funded by the Digital Education Revolution, which aims to see each student from years nine to 12 kitted out with a computer, also created possibilities for students, he said. "I hope that we can work with the ICT industry to seize the opportunities available."

Tasmania's preferred computer resellers and vendors are Lenovo, Acer, Apple, ComputerCorp, Nextbyte and IRIS Computing. It uses Anittel (formerly PKBA) and Cisco for networking equipment. Anittel and Hewlett Packard are the preferred vendors for servers and printers.

Vendors were to highlight opportunities they believed could be achieved by new technologies or services and indicate any trials which they wanted the government to fund. Expressions of interest close at 2pm on Friday, 4 December.

The first Tasmanian portions of the National Broadband Network are tipped to go live mid next year. The distribution of computers to schools is already well underway.

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• NBN Co banks with Westpac
• NBN Company hires CIO, govt chief
• Data#3 wins NBN office IT roll-out
• Tasmanian Premier Bartlett talks NBN

The sparse report was signed by NBN Co's company secretary, Alisa Taylor, an associate of Canberra law firm, Meyer Vandenberg Lawyers, on 20 October 2009, and the company's chief executive, Mike Quigley, on 2 September 2009.

The operating result for the two-month period was a $139,329 deficit. The report also revealed that the NBN Co had secured $10 million in equity, with 10,000 shares. It noted that the risks the company faced were minimal given funding would be sourced from the Federal Government. It's believed the company has also since secured a further $60 million in equity from the government.

According to the report, one million of that is covered under the Federal Government's Guarantee Scheme introduced last September in response to the financial crisis.

The report, audited by the Australian National Audit Office, covered the period between 9 April 2009 — two days after Prime Minister Kevin Rudd announced that the government had rejected all proposals for the first NBN process — and 30 June 2009.

The report describes the NBN Co Ltd's principal activities as being "to build and operate a National Broadband Network to deliver telephony and high speed broadband to Australian homes, schools and businesses". It also details the government's decision on 16 July 2009 to establish a joint venture with the Tasmanian Government-owned energy utility, Aurora Energy, for the construction of the fibre-to-the-home network in the state to 200,000 homes.

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• NBN Company hires CIO, govt chief
• Can not-so-smart meters help the NBN?
• Data#3 wins NBN office IT roll-out
• Quigley quenches Malone's NBN scepticism

Paul O'Sullivan, Optus CEO
(Credit: Optus)

O'Sullivan said the topic of an initial public offer (IPO) for Optus was a side issue. "It's really flattering when you have strong momentum and people are instantly speculating that you should be taking an IPO to market," he said in an interview with the ABC's Inside Business program on Sunday.

"But we were pretty clear at the result session. We've made no decision to do an IPO of the Australian business."

Optus last week posted a 22 per cent rise in second quarter net profit, with continued strength in mobile phone and broadband revenues. Parent SingTel reported 10 per cent profit growth.

O'Sullivan said Australian investors could already take advantage of the Optus and SingTel growth story by buying locally traded SingTel shares. SingTel shares closed at $2.28 on Friday, near the 12-month low $2.26 close on November 5.

That NBN
O'Sullivan also said the government's National Broadband Network (NBN) would be commercially viable and his company would be investing in it.

"We think the benefits to Australians from the new fibre to the home network are really extensive," O'Sullivan said. "Absolutely it will be viable. We've been willing to commit to investing in an NBN ... and show how this can be a good investment."

David Thodey, the chief executive of Telstra, the country's biggest telco, said last month it would not be viable for his company to construct a national fibre to the home network.

But Thodey also said it could be worthwhile for the government, which has considerations other than commercial returns, to do so.

O'Sullivan said the new network needed to be made as soon as possible, as it would give Optus and other telcos the chance to compete with Telstra on an equal basis in the residential fixed-line market.

"The NBN's a terrific opportunity not only for us but for all the players in telecoms to finally get a chance to compete on a level playing field in the residential home market," he said.

"The high bandwidth that goes into homes will offer a whole range of services and it will also mean that we can converge what you do in your home ... with what you do on your mobile device."

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• TPG: Don't worry, we're just like Optus
• Can the Telco Reform Act be win-win?
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"If this deal goes through, we don't intend to reduce any of Pipe's wholesale business," a spokesperson told ZDNet.com.au this afternoon. The spokesperson said the comments were the views of chief David Teoh, however the executive was unable to conduct an interview.

"Much of its current business is already under long-term contract with Pipe's foundation and other customers. It's worth noting that organisations like Optus also operate both wholesale and retail arms and all of us in the telco industry buy some services from each other," the spokesperson said.

Some ISP chiefs, such as Netspace's Stuart Marburg, yesterday said the main concern would be that SP Telemedia may give TPG preferential pricing, ending the neutral arrangement the industry had become accustomed to. Another ISP boss said it would be a "disaster" while iiNet chief, Michael Malone, was less concerned.

According to the spokesperson SP Telemedia intends to operate Pipe as a separate business. "PIPE has an excellent wholesale and corporate business operation and we look forward to the opportunity to grow it."

The company claimed that TPG and Pipe will work very well together, and that both they were both "efficient, well-run, cost-conscious companies with excellent staff."

One analyst however has a different view of the two companies' networks and cultures. "I've seen [Teoh] a few times, but he's a pretty closed book," said Southern Cross telco analyst, Daniel Blair. "I don't like TPG's customer service proposition, and I'm a bit dubious about the network." However, he commended Teoh for generating lot of free cash and paying off huge debts.

While some shareholders have criticised the current offer for failing to include a sufficient takeover premium, the spokesperson defended the offer as "excellent", and that it "represents a share price higher than any closing price in Pipe's history."

That may be, however Pipe Networks' shareholder David Hall told ZDNet.com.au there simply wasn't a takeover premium while Pipe would be carrying a large portion of the profits for the would-be merged company.

Asked whether SP Telemedia was confident it would be able to retain Pipe Network's engineering-focussed headcount, the spokesperson pointed to its retention of Pipe's popular chief, Bevan Slattery.

"Our strategy would be to allow Pipe Networks to continue to operate as a focused business," said the spokesperson. "We are extremely pleased that Bevan Slattery has agreed to stay on as CEO."

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• TPG-Soul merger to create DSLAM behemoth
• TPG sheds staff to Asia
• Soul-TPG drops out of Terria
• Industry laments loss of Pipe Networks

The tender will address improving ICT services, reducing costs and simplifying systems in accordance with the Defence Forces' Strategic Reform Program.

"Within a few years, Defence aims to have fewer suppliers of ICT services. However, those suppliers who are selected as key strategic partners will have increased responsibility and the opportunity to contribute directly to Defence's business outcomes. I encourage the ICT industry to actively participate in these Defence initiatives," said Dr Mike Kelly, parliamentary secretary for Defence Support, in a statement.

The invitation covers a number of distributed computing and terrestrial communications contracts, including the $200 million central ICT infrastructure contract currently serviced by Fujitsu's Kaz Group. The government has already approached industry for feedback on how it might be able to source alternative services to those provided by its $200 million Kaz contract.

"While periodic testing of the market is routine, on this occasion Defence aims to take a major step towards achieving its longer-term strategic ICT sourcing objectives; including further rationalising suppliers and lower[ing] costs," Kelly said.

The invitation to tender will be published on AusTender and new contracts are expected to be signed starting in mid-2010.

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• Defence overhauls ICT spending
• Defence rethinks $200m Kaz contract
• Defence commits $500m to fix payroll
• Defence flags $708m IT splurge

NCS will team up with German-based web content management company, CoreMedia, to migrate three ABC websites including ABC News. The new CMS platform aims to change the ABC's management and distribution of text, image, audio and video content.

Craig Preston, head of technology for ABC Innovation said that the ABC began researching new CMS platforms in late 2007, and would focus largely on performance upgrades as the current CMS is well beyond its end of life. The implementation would focus on transferring the sites over to the new CMS, but will keep the existing layout and features. Preston said new capabilities will be explored once the migration is underway.

"Once we migrate the first group over then we will want to add functionality, but we need to focus on getting everyone across first," said Preston.

ABC Online is currently Australia's leading supplier of digital content, and internationally is one of the largest providers of podcasts and vodcasts.

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• Sydney Media140: Photo gallery
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iiNet legal counsel Richard Cobden kicked off his closing submission to Justice Cowdroy by stating that iiNet sat squarely within the same law that prevented the likes of Telstra and Optus from complying with the Australian Federation Against Copyright Theft's (AFACT) request to forward its notifications to alleged repeat copyright infringers.

"[Section] 112E is clearly applicable to Telstra, Optus, and many other ISPs giving access to the internet, and we are squarely in the sights of Section 112E," he said.

Section 112E of the Telecommunications Act, which deals with customer privacy, is a key plank in iiNet's defence against AFACT's claim that by not complying with its requests, it authorised its customers' breach of copyright.

"Our primary position is that iiNet was never obliged to do anything, in particular anything the applicants asked them to do in relation to ... the notifications," said Cobden. "The law of authorisation does not require [a carrier] threaten customers with notifications or suspension or termination; however, if that's what applicants require ... we are not capable of doing by means of the Telecommunications Act."

Confronting the allegation that iiNet's business model is underpinned by illegal file-sharing, Cobden told Justice Cowdroy that iiNet had maintained the same practices since the "days of dial-up" internet — well before it was possible to share movie-sized files. He said AFACT had a distorted view of the world. "In many ways the applicants look at everything that iiNet does entirely through the prism of their own concern for copyright infringement," he said.

"Michael Malone and iiNet did not come across film downloading and say, 'let's incorporate this into our business'. That came up as it did for everyone else in the industry. All iiNet did was continue to grow the business by keeping up with and staying ahead of its competitors like Telstra and Optus," he said.

"Once you take that prism away and look at it in terms of business and keeping up-to-date with technologies, and keeping its customers happy, almost every document, internal document, takes on an entirely different reflection."

Authorisation
The battle over exactly which legal precedents are the rightful parents of the term "authorisation" under the Copyright Act also continued today. AFACT had last week, in its closing submission, argued that the 1975 case between the University of NSW and Moorhouse was central to the term's use. Authorisation there relied on the university providing photocopiers and books, iiNet's barrister, Cobden, said today, likening BitTorrent to photocopiers and books to copyrighted films.

"The ingredients for authorisation were the photocopier, plus the copyright library books taken from library shelves," he said. "We do not supply BitTorrent."

Cobden argued a more relevant case was a 1911 precedent involving infringements at a public space — Adelaide Corporation versus the Australasian Performing Rights Association (APRA) — which he said showed there was no "duty to interfere" with the communications of its subscribers. AFACT has broadly argued that because iiNet did not forward its notifications and refused to cut off repeat infringers, iiNet had authorised its customers' deeds.

iiNet's protection under Safe Harbour provisions, which limit a carrier's liability under the Copyright Act if it has a policy in place to deal with repeat copyright infringers, had not been threatened by the evidence presented, according to Cobden, because no person had been identified. He said the only person who had been identified as an infringer was AFACT's own investigator, Aaron Herps, and iiNet had not cut his service off because he was licensed by the Hollywood studios to do so.

Cobden said he intended to on 19 November work towards undermining AFACT's claim that iiNet customers had committed primary copyright infringement by way of reproducing DVDs of the 86 titles and other films the case centres on. "There is no evidence that there is consequential burning of DVDs," said Cobden, but said iiNet had accepted that primary infringement occurred where customers made content available online.

He said the number of actual instances of file-sharing over the 59-week period that AFACT's copyright monitoring contractor, Danish software vendor, DTecNet, had counted was nowhere near the 97,000 claimed by AFACT. "We submit ... that it's not a trivial number but ... it's not going to be anything like the applicants say," said Cobden. A more realistic number might be closer to two to three films in total, per iiNet account, said Cobden.

iiNet's closing submissions are expected to continue next week, with further dates confirmed for 24 November, when the Internet Industry Associations chief, Peter Coroneos, may weigh in on the debate.

Justice Cowdroy is expected to deliver his judgement in six to nine months time.

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• AFACT attacks Westnet piracy policy
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The tipster claimed Sensis had combined 19 databases into one, leading to the failure of the iGen system. Reps around the country are taking stress leave and quitting. Sensis can't send out any invoices, contracts, proofs or artwork. "Paper contracts are being faxed to Brisbane where there are about 8000 waiting to be input by hand at the rate of three per day per person," wrote the Crikey tipster.

But Sensis spokesperson Karina Keisler denied the claims, stating: "About the only truth in the Crikey article is the name of our new system." Sensis has undertaken a major upgrade of its system process, including a consolidation of its databases; however, Karina Keisler denied total system failure. She said today: "We have had some success and some teething problems during the process, like any systems implementation would."

These teething issues included moving the Sensis White Pages site back to the old legacy system; though the implementation period from 12 October included a planned system freeze, according to Keisler.

The Sensis Yellow Pages site is continuing to operate on the new system.

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• Sensis cuts another 70 jobs
• Sensis lets 192 jobs go
• The long-awaited separation of Telstra
• Telstra dumps paper admin fee

Mike Kaiser is currently leading Bligh's camp but will start work with NBN Co on 1 December, according to a statement issued by the group this afternoon.

Kaiser served in the Queensland parliament until 2001 when he resigned after admitting during the Shepherdson inquiry to involvement in vote rigging in Labor Party ballots in the 1980s.

He will be responsible for engaging with governments at all levels, including the federal sphere, as well as other external stakeholders. NBN Co chief executive Mike Quigley said that one of Kaiser's early focuses would be to identify opportunities for utilities to work with NBN Co.

Rawlins has qualifications in electrical engineering and economics and has worked as chief of staff to two premiers, as well as working in the private sector.

The new chief information officer is Claire Rawlins, who was most recently managing director of Group Technology for BT Design, a division of British Telecom.

"In this role she had responsibility for designing, building and implementing the IT and business processes, systems and technology," NBN Co said. "She will be responsible for IT strategy architecture, delivery and support of [the] NBN's extensive IT systems and applications."

Rawlins has also worked for Fidelity Investments, Qwest and Dresdner Kleinwort Wasserstein in a senior IT capacity.

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• Can not-so-smart meters help the NBN?
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(Credit: Tourism Queensland)

There were four contracts on offer within the CITEC managed identity directory and email services project which have been snapped up by three vendors.

According to a spokesperson for the department, IBM has won the contract for identity management. Some 250,000 identities will be migrating.

Data#3 has been hired for the content filtering and email archiving, which will use Symantec enterprise vault.

Dimension Data has received the meaty job of migrating the government to the new system.

The government was unable as yet to provide pricing information for the deals. There will be no additional tender for Microsoft licences as the government will use its existing whole-of-government Microsoft licensing agreement for the program.

The departments and agencies whose users will be migrated onto the centralised email platform are already using Exchange, but some installations of IBM's Lotus Notes/Domino and Novell's GroupWise platforms remain throughout the state government.

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• Queensland plans huge Exchange 2007 project
• August start for delayed Qld mail project
• CITEC swallows Qld's transformation project
• IBM finishes $22m Qld toll system

James Hegarty
(Credit: NSW Government)

Hegarty joined the Department of Ageing, Disability and Home Care (DADHC) in July 2002 to take on the challenge of consolidating systems from within the disparate Home Care, Ageing and Disability departments. It had four different payroll systems, three different finance systems, four different wide area networks and three different email systems.

The 13,500-strong department has now become part of the Human Services department after the NSW Government's decision to consolidate into 13 super agencies.

Previously, Hegarty had been the executive director of information management at the Department of Corrections. Prior to that he held senior positions within the NSW Department of School Education. He was also a foundation member of the NSW Government CIO Executive Council.

His last day with the department is 18 December when he is proceeding on leave prior to retirement. A replacement has not yet been determined.

The CIO position at the Department of Corrections has also undergone a slight change, with Wayne Ruckley stepping out of the role within the last few months to take up the mantle of acting assistant commissioner, according to a spokesperson for the department. There was a reshuffle at the top after the Deputy Commissioner Ian McLean went on long service leave, the spokesperson said. Director of planning and strategy Aaron Liu has moved up to become the acting CIO.

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• NSW DET mum on IT review
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His newest contract has recently been released on the Victorian tender site. For the two years from 1 August 2009 to 1 August 2011, his company Pharma Insight will receive $900,000: a step down in pay from his last pay packet, but also a longer commitment.

The public eye had already been trained on the executive because of his previous large pay packets. For the year 1 September 2008 to 31 August 2009, Velummylum was paid $493,680 for a year's work as CenITex's chief of operations. Prior to that his company (under a different trading name) held a contract worth $215,620 for five and a half months' work implementing the agency's IT service delivery model.

The amount he earned obtained some scrutiny by Victorian Shadow Information Technology Minister Gordon Rich-Phillips in state budget estimates hearings earlier in the year. Rich-Phillips said that senior positions such as chief of operations shouldn't be filled by very highly paid contractors.

After these events, Velummylum changed his role at CenITex to become the transformation manager for the agency's Efficient Technology Services program, which creates the common ICT services used to supply shared services to agencies' needs.

The dates and amount for the chief operations contract listed in the Victorian tender site also seem to have been altered since June, reducing to $457,765 for the new period of 4 August 2008 to 31 July 2009. The altered dates would mean that his first two contracts overlap by a month.

Taking the altered amounts into account, the new contract will bring Velummylum's payment for services to CenITex to just over $1.5 million.

CenITex had at the time of writing not commented on the appropriateness of the payment or Velummylum's role change.

CenITex advertised recently for a new chief operating officer to fill the position Velummylum left. It also recently signed a deal with BMC software for service management. The value of this four-year contract has now been released as $4,847,204.

CenITex currently provides services to the Victorian Departments of Transport, Planning and Community Development, Premier and Cabinet, Primary Industries, Sustainability and Environment as well as Treasury and Finance. By 2012, it hopes to also supply services to the Departments of Innovation, Industry and Regional Development, Human Services, Justice, Education and Early Childhood Development as well as to VicRoads, the State Revenue Office, the Environmental Protection Authority and Victoria Police.

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• BMC signs on Vic's CenITex
• CenITex replaces $493k COO
• CenITex COO also had $215k contract
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"This will be a disaster for the industry. Because, for roughly 50 per cent of DSLAM exchanges, Pipe is the only alternative to Telstra," said the boss of one of Pipe Networks' ISP customers who wished to remain unnamed. "In the type of services ISPs need and Pipe provide, they are the only game in town. This will be a major problem for the industry. It's terrible."

Boss of a smaller client, Exetel, John Linton said he would take his $40,000 per month spend with Pipe elsewhere if it's merged with TPG parent, SP Telemdia. He said he wasn't criticising the way SP Telemedia boss, David Teoh, runs the ISP but, "Why would we do business with TPG?" asked Linton.

Linton's comments were in stark contrast to iiNet boss, Michal Malone, arguably Pipe's largest customer, who yesterday said the proposed sale to SP Telemedia was not a supply concern. "We all buy stuff from each other anyway," said Malone. Still, highlighting the sentimental status of Pipe to the industry, Malone added that Pipe's two co-founders Steven Baxter and Bevan Slattery had "changed the landscape of Australian telecommunications forever".

Chief of mid-size ISP Netspace Stuart Marburg said there were worse outcomes than what's been proposed. "I don't think anyone would be happy, but at least it's not Telstra buying them," he said.

"I think the main concern is that [TPG] will get preferential pricing ... but you can't do much about it," said Marburg. He congratulated Baxter and Slattery for "setting up a great company and getting a good return on that".

But few of the ISP executives who ZDNet.com.au interviewed for this story were surprised by Slattery or Baxter's decision to sell. One source close to Slattery called him a "serial entrepreneur" while two other directors from separate ISPs said Slattery had been looking for an "exit strategy" for the past year.

"This looks like the latest round in Bevan and Steve's exit strategy," one said, but noted that the four-month horizon before a decision is approved gave ample time for a preferable entity to place a bid for Pipe Networks — the NBN Company.

According to this source, Pipe's metropolitan fibre network, which the likes of iiNet, Internode, Netspace, iPrimus and others heavily rely on for connectivity to phone exchanges for the provision of ADSL broadband services, reaches about 80 per cent of Australia's population, which made it an attractive option for the NBN Co.

Boss of iPrimus, Ravi Bahtia agreed. "The NBN Co should buy it because Pipe has what the NBN Co needs — backbone transmission. The NBN Co will need a grid, and will be a wholesale provider of connectivity, and this would play a role in that."

But Southern Cross analyst, Daniel Blair, said the National Broadband Network plans were not clear yet, and that there was a chance Pipe's fibre network won't reach the right places. "How does this change under an NBN? At the moment, you have 5000 phone exchanges in Australia. Under a copper architecture, exchanges are about every 1.5 kilometres apart. From what we know, with GPON (the core technology planned for the NBN) you can go up to 20km from a home, so many of those exchanges are not required and could be bypassed completely."

Shareholders though, were not happy about the $6.30 offer made by SP Telemedia. David Hall, an owner of Pipe shares said although shares were trading at a fairly high multiple, there wasn't a takeover premium. "It's quite clear that Pipe will represent quite a large portion of their profit going forward," said Hall.

Yesterday, SP Telemedia issued a 2010 guidance outlining that its $470 million annual revenue would amount to $47 million in net after tax profit, while Pipe's $98 million revenue would deliver a profit of $25 million, roughly a third of the merged entity's expected profit.

Both Netspace's Marburg, also a shareholder in Pipe, and Southern Cross' Blair agreed with Hall.

"The consensus valuation for Pipe is about $6.80 so [the $6.30 bid] is in the ball park, but there's no premium," said Blair.

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• Pipe Networks sell-out an absolute travesty
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... numerous instances of Ms Berzins, Mr Brown and others accepting hospitality from IT vendors including invitations to the Australian Open Tennis, AFK Grand Finals and the Melbourne Cup

Victorian Ombudsman

A report by the Victorian Ombudsman was tabled in parliament today describing multiple cases of questionable behaviour by former CIO Berzins and the Business Information and Technology Services (BITS) section of the police she was in charge of.

In one case, the division decided to redirect services formerly carried by IBM to Fujitsu, stating that IBM had no desire to provide those services, when communications from IBM belied that fact. There was also a renegotiation of service level agreements with IBM which occurred — perhaps to compensate it for the loss of the services to Fujitsu, although the ombudsman did not believe that. This redefinition of SLAs cost the police millions, according to the ombudsman.

The department achieved an exemption from asking for multiple quotes in the case of Fujitsu's taking over the services, since the money required would come out of the IBM services envelope. However, while the purchasing board approved $11 million, the final value of the contract came to $27.2 million — $15 million above expenditure. The remaining funds were taken from other approvals, with Berzins telling group manager of Business and Planning John Brown to "just do it" when asked where to find funding.

Berzins said that she in general didn't closely monitor the BITS budget, with the details being left to Brown. Brown's control, according to the ombudsman, was illustrated by the fact that information on the $27.2 million Fujitsu contract was largely to be found on "a handwritten note [Brown] provided to a BITS manager in a meeting several months after his resignation".

"I consider that record-keeping and file maintenance within BITS over the past three years at least, was largely inadequate. My investigation was hampered by gaps in documentation, records that were not dated, not signed or did not include author details, and a general lack of any apparent systematic record-keeping," the ombudsman said.

Another contract for $20.1 million for the provision of an enterprise services bus software licence by TIBCO was exempted from being taken to tender because Brown said that TIBCO would offer a 92.6 per cent discount if the government signed up before a certain date.

When questioned on the large discount, TIBCO's general counsel for Asia Pacific and Japan said that such discounts were worth it. "High discounts of this nature are not uncommon for TIBCO with government sector clients. TIBCO was prepared to offer this level of discount due to the increased presence the contract would give it in the Australian government market and the opportunity to leverage into other Victorian government departments," they said.

Indeed, Brown tried later to have the TIBCO contract made into a whole-of-government contract, which the procurement board refused. The market analysis for that contract was carried out by TIBCO, which the ombudsman found inappropriate.

Meanwhile, Berzins was getting perks from vendors. "My investigation identified numerous instances of Ms Berzins, Mr Brown and others accepting hospitality from IT vendors including invitations to the Australian Open Tennis, AFK Grand Finals and the Melbourne Cup," the ombudsman said.

The ombudsman said that there had been further breaches of government procurement policy by the division to the tune of $39.17 million. Internal audits also found 56 breaches by BITS employees in the engagement of contractors.

This behaviour was noticed at the end of last year, with the former Chief Commissioner Christine Nixon informing Berzins of the intention to terminate her, so Berzins took early leave and ceased to work for the police. Brown resigned before she did.

Instead of directly appointing another CIO, a board of management was appointed to rectify the issues within the department. Since that time an executive director, infrastructure, Michael Vanderheide, has been appointed from ACT shared services.

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• Vic Police nabs IT head from ACT shared services
• New chief to shake up Vic Police IT
• Vic Police looks for new CIO
• Wanted: IT saviour for Vic Police

The network, which was launched as XT in May, will be available to wholesale customers by mid-2010, a year earlier than originally planned. Telecom's announcement had been foreshadowed on Friday after the company admitted XT sales has been slower than expected.

A statement from Telecom today named Digital Island as a partner, a supplier of telephony services to businesses, but others are expected to be announced before Christmas.

The move comes as the New Zealand Commerce Commission today announced that the arrival of third network supplier, 2degrees, into the New Zealand market had boosted competition and lowered prices, with some below the OECD average for the first time.

The Telecom statement today said Telecom has been trialling wholesaling mobile technology with Digital Island, which began offering a Telecom-based CDMA-based product in April 2009. Telecom wholesale general manager of marketing Nick Clarke said wholesaling the WCDMA network would give telecommunications retailers much greater choice of services, and the moving forward of wholesaling follows feedback from such retailers.

Telecom Wholesale spokesperson Nicole Walker told ZDNet.com.au that talks were underway with several other potential providers, but Digital Island was the only one Telecom could currently identify. She expected others would be announced before Christmas.

The impact of wholesaling would mean more choice and innovation with services, which should mean lower prices and benefit consumers. As for Telecom, the impact of wholesaling on it would be hard to say. "They (retailers) want to be part of this (XT) mobile network. Hopefully, they will take customers from other networks," Walker added.

Already Vodafone is losing sales as competition hots up.

Digital Island general manager Blair Stewart said his business already supplied several thousand medium-sized firms with telephony services. Offering the new XT network would be a "shot in the arm" for his firm, and he expected his client base to double by the end of 2010.

Existing wholesale ventures like Black & White, which used the Vodafone network, were aimed at consumers, while Digital Island offerings would target business. Stewart confirmed a soft-launch would start in April on the XT network, with a full-launch by mid-2010.

"Bundling services is a strong part of a telco offering," he told ZDNet.com.au. "We can bundle this with fixed voice data." Stewart said Digital Island's business model allows pricing 20 per cent lower than the mainstream competitors. He expects rival suppliers to also offer services from Telecom's WCDMA network but says this "can only be good for customers".

Indeed, the Commerce Commission's Market Monitoring Report, released today (PDF), noted the impact of added competition from third network 2degrees.

Previously, New Zealand came bottom of the OECD ranking of 30 on affordable prepay mobile plans, but it has since risen to 26th, in the six months ending 30 June.

Commentary for the months after said that following the arrival of 2degrees in August, for the first time in the Commission's analysis, New Zealand customers can access prepay mobile prices for less than the OECD average.

Prepay plans were important to New Zealanders as two-thirds of mobile users use them, said Telecommunications Commissioner Ross Patterson.

The building of technologically compatible mobile networks was also making it easier for users to switch between rival networks without changing phones. August and September saw more than triple the usual number switching to another network and taking their number with them.

The Commerce Commission also noted the take-up of broadband services grew 14 per cent over the year, with pricing similar to that of developed countries.

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• XT network boosts struggling Telecom
• Telecom NZ investors quiet on CEO's pay
• Telecom chair defends executives' pay
• Telecom NZ speediest for car association

The employees were asked to sign contracts from around September, according to APESMA director of industrial relations Michael Butler. The signatures would mainly have been collected by now, he said. According to a spokesperson for HP, full legal integration including employee transition was completed by 1 November 2009.

Originally there had been some concerns that new contracts would mean worse conditions. The union said in a bulletin earlier this year that management had been speaking about moving employees into an off-shore company on lower pay and working conditions without recognising previous years of service or accrued leave.

"The issue stemmed from [HP's] belief that by the offer of new contracts they could basically wipe the slate clean," Butler told ZDNet.com.au.

However, doing so wasn't allowed under the Fair Work Act, according to Butler, a fact around which the union rallied with success.

"Under these rules, if you are transferred from one business to another (for example as part of a corporate takeover) and if you are retained to do substantially the same work as before, then your new employer must maintain your previous working conditions and entitlements and recognise all of your accrued leave entitlements," APESMA said in a bulletin.

HP conceded to the rules after deliberations, APESMA said, so that the current EDS agreement was transferred in its entirety, salary was preserved, the entire period of service was to be recognised, and individual redundancy and severance arrangements were to carry over. The association was very happy with the outcome.

HP was a little more cryptic on the transition. "The job migration process ensured that EDS jobs were mapped and aligned to HP jobs and salary structures. This enables HP to effectively drive its pay-for-performance strategy with a consistent job-based foundation for rewards, development and organisation planning," the HP spokesperson said.

The EDS brand has now been retired, with HP making the decision to end its life just over a month ago.

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• HP has no respect for EDS
• HP dumps EDS brand
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• Australian EDS staff face new contracts