Conroy says that he will not allow the network to be jeopardised by Telstra

In order to stop the success of $10 billion-plus broadband network from being jeopardised by Telstra, Stephen Conroy, the Communications minister has said that he is ready to use all of his regulatory powers.

Suggestions that in the midst of the global economic downturn the Federal Government would not be able to continue without support from Telstra were thrown out by the minister, who also refuted any claims that the project was now a “dead parrot”.

The promise of fibre cabling to be extended all the way to street nodes from the telephone exchanges was something that Senator Conroy also insisted recently that the government would live up to.

He said “We will do whatever we need to do in terms of the regulatory environment to ensure the national broadband network process succeeds.”

Despite the largest one-day rally in three months being recorded by the market, the share price for Telstra dropped 9c to $3.06, which was an all-time low following increasing concern amongst investors. Since its exclusion in early December from the government tender due to the failure of its proposal to meet the basic criteria, nearly $13 billion has been wiped from the market value of Telstra.

It could be as early as next week when the preferred bidder for the project is revealed by the Government. It is possible there may be delays until after April 4th when Kevin Rudd, the prime minister, returns from his two week trip to Britain and the US.

Telstra recently unveiled its plans to boost its cable broadband speeds in Melbourne costing it $300 million in a pre-emptive strike against the Government before it picks its preferred tender. Telstra being the only logical builder of the network is a thing that some analysts remain convinced about.

Senator Conroy said “I can assure you that [the project is] anything but a dead parrot.” If the Government believed that Telstra were the only ones capable of building the network it would not have bothered continuing with the tender process, said the minister.

He said “It’s disappointing from [Telstra's] perspective and their shareholders’ perspective that they decided to play the games that they did. I don’t understand what Telstra were doing. The shareholders should be asking the board and the management, ‘what were you doing’?”

The possibility that Telstra would try to delay the project by resorting to legal challenges was also played down by Senator Conroy, referring to it challenging the telecommunications access regime over a year ago and the company being “spanked seven-nil” by the High Court.

He said “They tried it on and the High Court threw them out. So any arguments about ultimately whether we can access their exchanges, their ducts or their nodes has been pre-determined by the High Court.”