Telstra drops threat, makes last-minute “bid” for NBN

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Telstra’s board have agreed in an emergency meeting to make a last minute “bid” for the National Broadband Network, just hours before the noon deadline today where all applications were closed. This comes after months after saying that it would walk away if its demands were not met for the $4.7 billion in taxpayer’s money project – including ditching the rule that would see the network being separated from the tender winner after being completed.

Telstra’s bid joins the bids from Acacia Australia, Axia NetMedia and the Terria consortium-backed bid under Optus’ new entity – Optus Networks Investments (ONI). The Tasmanian Government and TransACT have opted to try and build the network in their own state or territory where they are located.

Telstra’s plan, however, says that it could not build the project that would reach 98 percent of the project, instead it has opted to spending the money on upgrading its own network to reach 80 – 90 percent of the country. It claims that due to the changed financial climate, falling dollar and the slowing economy as reasons why it could not build the network.

The bid came in a 12 page letter, according to The Australian, to Senator Stephen Conroy, Communications Minister; even though Optus’ ONI’s proposal is said to be close to 1000 pages.

The suggested reason why Telstra dropped its stance was because it could lose up to $10 billion in its market value, according to The Age, if it did not compete for the tender to build the national network – breaking the promise of Sol Trujillo, CEO of Telstra, of transforming the telco by 2010.

However, a panel of experts – including former chairman of the Australian Communications Authority, Tony Shaw, and investment banker John Wylie – have two months before making a recommendation to Senator Conroy on who should be the winner of the tender.