Thursday, January 8, 2009

Victoria Broadband Bid - “A Private Equity Bid Unlike Australia’s Ever Seen Before”

[article written by Michael Watkins for on June 15th 2008]

Details have emerged of who is behind the secretive Acacia syndicate that is planning to launch a bid for part of Kevin Rudd’s broadband network. The part in question will cover the state of Victoria with broadband, worth a reported $4.7 billion in taxpayer funds.

Investors in Acacia include Telstra Countrywide CEO Doug Campbell, directors at KPMG, Highpoint Property Group and Seek founders Paul and Andrew Bassett to name a few. A very high profile list in Australian business circles, with some referring to the group as the “Melbourne Mafia”.

Telstra, is of course nervous at the news as they will lose control of the broadband roll out if the new network is separated from Telstra’s existing fixed-line network. Telstra Chairman Donald McGauchie was quoted as saying “The Government needs to take this whole flawed, nonsensical concept of structural separation off the table”.

Telstra has every right to be nervous. I’m sure most consumers hanging out for faster broadband speeds in Australia will endorse a break from Telstra’s monotonous, slow moving structure to that of a fast, nimble provider who could roll out the new infrastructure at a faster pace.

The project looks set to be sold back to the government once the core infrastructure is put in place and the system is working fluidly, much the same as toll roads have worked in Australia.

I can only see this as a good thing for the countries Tech Industry. Telstra is a dinosaur that has failed the Australian Tech sector and consumer with 3rd-World broadband speeds.

Faster broadband speeds equals more breadth and depth for Tech startups to make realistic plays worldwide and actually stay in Australia whilst doing it.

Maybe I am jumping the gun on Telstra. I just think they have had long enough to make cheap, fast broadband accessible in Australia. If a batch of new syndicates can come in and offer the country what it needs to make it a realistic player in the worldwide tech industry and do it fast, I’m all for it.

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