blog Posting this one by popular request from quite a few readers who apparently want to debate it. According to The Australian newspaper, which has apparently garnered an interview with Telstra chief executive David Thodey on the sidelines of the Mobile World Congress conference in Barcelona, Thodey has already started playing hardball with respect to the $11 billion in payments which Telstra is set to receive as part of its deal with the Government and NBN Co. The newspaper reports (we recommend you click here for the full, paywalled article):
“Telstra chief executive David Thodey has ruled out renegotiating the $11 billion bounty the telco giant will be paid to lease its assets and migrate on to the National Broadband Network in the event of a Coalition election victory in September.”
To be honest, I’ve been holding off on linking to this because I believe Thodey’s comments to be broadly … a whole bunch of bullshit. Is Telstra really saying that if the Coalition wants to drastically alter Telstra’s involvement in the NBN, shifting from a FTTP to a FTTN model and reusing Telstra’s HFC network, that Telstra will demand the exact same price for a completely different setup?
That just seems ridiculous … and I really highly doubt that any Government would put up with that. In my view, this is just the first opening gambit from Thodey, to signal that no matter what happens, Telstra is going to want a similar amount of cold, hard cash (and don’t forget that money has already started flowing to Telstra, it was detailed in its recent financial results) from the NBN project. It’s good to start aiming high. But I highly doubt that the end result of a Coalition Government will be the same $11 billion payment to the big T. Different deal, different price. That’s just basic business sense.
One strongly suspects, of course, that there are already provisions in the gargantuan agreement between Telstra and NBN Co for precisely this kind of situation. However, it’s a little hard to know for sure, given that the Government has blocked the contract from being released publicly, despite the best attempts of Internode founder Simon Hackett. In any case, I doubt Thodey’s pledge this week will stand the test of time.
Image credit: Telstra