A spokesperson for Pipe Networks' potential new parent, SP Telemedia, has pointed to Optus as a prime example of how it can successfully operate a wholesale and retail telco.
Pipe Networks' chief, Bevan Slattery, may have found his "cash-out" door from the company that helped internet service providers snub Telstra, but many of those customers are not happy that a direct competitor could now control it.
SP Telemedia, owner of TPG and Soul internet service providers, has announced its intention to acquire Pipe Networks for $373 million.
Pipe Networks and SP Telemedia have both gone into a trading halt this morning, pending announcements to be made later in the week.
Opinions are split amongst analysts, telcos and ISPs as to whether Pipe's new PPC-1 Sydney to Guam submarine cable will lead to lower broadband prices for Australians, but all agree the threat of its arrival, set for October, has had a positive impact already.
The potential acquisition of Pipe Networks by SP Telemedia has raised the question about whether vertically integrated backhaul providers will mean higher wholesale prices for ISP customers.
Labor's policy of socialised broadband has certainly proved much harder than the party believed it would be back when it was in Opposition, but it is Telstra that stands to lose the most from the NBN - and that applies whether it loses the NBN contract or wins it.
For no particular reason that I can discern, a 1979 Kenny Rogers song popped into my head as I was considering the ever more complex morass that is the national broadband network tender which Senator Stephen Conroy defended in his CeBIT keynote speech.
The proposed buyout of Pipe Networks by SP Telemedia is an absolute travesty for Australia's telecommunications industry and will be overwhelmingly negative for customers, Pipe Networks staff, shareholders and the industry as a whole.
Father, brother, cancer survivor, highly intelligent engineer and leader of the "Australian mafia" group of executives who battled their way to the top of global telco supplier Alcatel-Lucent. We present Mike Quigley, executive chairman of the National Broadband Network Company.
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