Telstra NBN bid rejected, lawsuit “100 percent” likely to happen

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The Federal Government has rejected Telstra’s bid from the process to win the bid to build a $10 billion-plus national broadband network, saying that it did not include a plan on how to “involve small and medium enterprises” when building the network, according to Telstra. What’s even more (not) surprising, is that a spokesperson for the Communications Minister, Senator Stephen Conroy, has said that Telstra cannot resubmit its bid.

“The expert panel has determined that Telstra’s submission to the national broadband network is not compliant. They are out of the process now,” the spokesperson told the media.

While the other competitors made bids detailing on how it will build the network (with Optus’ bid being over 1,000 pages long), Telstra submitted a last-minute bid of thirteen pages offering a detailed bid if the Government complied with its demands, including removing the structural separation (meaning that they cannot be a monopoly over the NBN); and offered to use the money in upgrading its existing network.

Telstra is unhappy with the news, defending its bid by saying that it was with “real financial commitment” and that Telstra was the “only company with the existing network, technical know-how, world-leading vendor, skilled workforce, established wholesale systems and proven track record of building world-class networks.”

“Telstra considers it has fully complied with the RFP requirements (which did not require a SME Plan to be lodged as part of the RFP Proposal itself) and that the Commonwealth has used a peripheral issue to exclude Telstra,” said Donald McGauchie, Chairman of Telstra.

“The Commonwealth could hardly have dreamed up a more trivial reason to exclude Telstra from the NBN. This is a process that seemingly excludes bidders on such trivial and legally questionable technicalities but doesn’t take any action on material issues such as financing and having the technical capability to build the network.”

Speaking to ZDNet, Gartner research director Robin Simpson said that Telstra is “100 percent” likely to challenge its exit from the bid, saying that the telco isn’t afraid to sue the government. Also in agreement with this analysis was Stephen Collins, who is the founder of acidlabs; saying in a blog post that Telstra’s senior management “continues to believe that being, to quote a trading phrase, “big swinging dicks”, is going to get them what they want.”

“I hope that the Federal Court tells Telstra to pull their heads in when the inevitable case comes before the Full Bench,” he continues.

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