Consortium speculation leaves analysts divided
The latest opinions from both Telco players and analysts regarding speculation that bidders will be requested to form of a consortium to build the National Broadband Network (NBN) have so far been mixed.
Dr Paul Brooks, Layer 10 Communications founder said that the idea of various proponents considering this move would not surprise him at all. Brooks said “It’s entirely possible that a mainland bidder could be asked to form a consortium with the state-based bidders in Canberra and Tasmania for them to do their territories and for the national group to do the rest.”
He did say, however, that due to the arguments that could occur from both funding issues and technical details like choice of technology, vendors, cable length, transmission power and distance it would be unlikely. He said “On a geographic basis where each party has their own geography to look after and there is not the requirement to modify the design based on decisions made by other parties within the consortium, then that may work.”
The combining of the best parts of all the bids by the government was something that David Forman, the executive director of Competitive Carriers Coalition (CCC) said that he expected and hoped for. He said “We at the CCC have advocated from the start that bidders should be encouraged to work together, and it was clearly necessary for this to occur under the government’s process because they allowed for regional bids. These bidders need to be able to work in conjunction with bids covering other regions at the very least.”
With the deployment of Fibre-to-the-home (FttH/FttP) being maximized and a large choice of both fixed and wireless technologies, Foreman claimed that this method would lead to the each area getting the best technology fit. Shara Evans, the CEO of Market Clarity the telco research firm sided with Brooks in saying that it would be more workable with a consortium on a state-by-state basis.
She said “If you take commercial bidders who are rivals and say ‘we want you to collaborate together and come up with the best of the best’, then you will have all kinds of vested commercial interests that will cause conflict and the proponents may not be willing to share network build or design plans with their competitors. It certainly could go to one national bidder and one or more state-based bids, but if you take significant parts of a bidder’s offer the whole bid would have to be re-evaluated in light of the bits taken out to see whether it impacts their commercial business case for other areas.”
