Hercule Poirot, where are you when we need you?
After months of rhetoric and enthusiastic chest-beating, Terria is falling apart at the seams. Whether the company's executives are just discouraged by the lacklustre economy or quietly packing their suitcases for more investment-friendly climes, the group's members are dropping faster than secondary characters in an Agatha Christie mystery.
A Terria billboard in Canberra
When I first sat down to write this column, I was going to lament the 24 October decision by Soul to withdraw from Terria, but Monday, 27 October brought even more fodder as TransACT quickly followed suit.
These two followed on from the 16 October withdrawal by AAPT, which has decided its money is better spent embedding U-SIM cards in New Zealand sheep. Or something like that.
Once determined to be the pit bull Terria chewing on Telstra's 800-pound gorilla ankles, the Group Formerly Known as G9 is in full damage control this week — as evidenced by its hasty rush to push out a press release explicitly restating the support of the remaining CEOs: Primus Telecom's Ravi Bhatia, Optus' Paul O'Sullivan, Macquarie Telecom's David Tudehope, Internode's Simon Hackett, and iiNet's Michael Malone.
All restated their "rock solid" support for the Terria proposal, yet look elsewhere on ZDNet.com.au and there was Malone, blasting what he called a "mindless political agenda that has nothing to do with customers any more."
"The government has everything shooting in the dark, with a clandestine expert panel and a closed doors ministerial decision to decide everything," he said.
Ain't it the truth.
I wish it weren't, but my column two weeks ago is more and more prescient every day: analysts are now ruminating on whether Senator Stephen Conroy should rightfully suspend the NBN bid entirely. Optus isn't helping anything with its ongoing 3G network dramas, and watching Terria waste away before our eyes is even more distressing to those hoping the NBN will bring about real change.
Bookmakers, grab your calculators. The way things are going for Terria, by the time you read this, what was once the G9 — and is currently the G5 — may well have knocked off a few more recession-spooked carriers (watch out, guys — G1 is already copyrighted by T-Mobile/HTC/Google, although I guess that would just be Optus, now, wouldn't it?)
The geographic spread of the remaining Terria members still gives the company a national footprint; they'll be leveraging their respective geographical strengths to support and manage Terria's nationwide wholesale operation — iiNet in WA, Internode in SA and the NT, Macquarie in NSW, Primus in Victoria, and Optus in NSW and Queensland (uh, wait a minute ...).
That makes sense, but the rapid attrition by once-committed Terria supporters, not so much. If any other members drop out, the whole house of cards could well collapse, leaving Australia's broadband market at the mercy of Telstra and its persistent demands for a vertical monopoly.
(I'm tipping Primus and then Macquarie to go, if anybody's counting, because iiNet and Internode will be fighting for purchase and blasting Telstra even when the tip of the mast is the only part of the Terria ship still sticking out of the water).
Conspiracy theorists, skip to here.
Reading between the lines paints a scarier picture. My warning bells were flashing when Terria and TransACT released a joint statement saying that "as the bid date drew closer it had become apparent that it was in the interests of both companies for TransACT to withdraw from Terria".
Here's the kicker: "This will enable commercial negotiations between TransAct [sic] and Terria to be conducted without any conflict of interest, either real or perceived, among our respective directors."
Am I understanding this right? Terria doesn't want it to seem like TransACT, which sells retail services in the ACT, would have an unfair advantage in negotiations for access to Terria's wholesale network?
If that's actually a real concern and not just poorly placed spin, there's little hope for the other remaining members of Terria either, since all of them also provide retail services and would presumably face similar issues. This is doubly disturbing because Optus has already conceded that the other Terria members were mainly there to bolster the commercial viability for its bid; yet, we are told, TransACT's withdrawal was coming for months.
The inference that Soul, AAPT and TransACT were Dead Telcos Walking long before their withdrawals were announced makes me wonder whether Terria has always been, God help us all, just as flimsy a proposition as Telstra has made it out to be.
"Mr Egan and Mr Mackay said this [withdrawal] was a long-standing expectation by both companies," says the TransACT press release. Looking at the release announced after Soul/TPG withdrew, there's the statement that "Soul has not been an active or contributing member of the consortium ... their announcement today formalises what has been reality for a number of months."
And then there was AAPT chief executive Paul Broad explaining the company's withdrawal by saying "we are at the point where people have to put money into the bid process, and we're not going to be doing that".
Such major decisions aren't made lightly, and the inference that Soul/TPG, AAPT and TransACT were Dead Telcos Walking long before their withdrawals were announced makes me wonder whether Terria has always been — God help us all — just as flimsy a proposition as Telstra has made it out to be.
Is it an alliance of truly committed infrastructure partners, or just a group of fair-weather friends who are now amicably parting ways because the world's economic woes don't make rebellion financially attractive anymore?
Or — and the conspiracy theorists (and Telstra) will love this one — were these departures always intended this way? Was Optus' sole purpose with Terria to help Australia's major ISPs get access to NBN information — including detailed Telstra network information — with its partners, then send them off one by one to go build out a complementary network by proxy as it submits its own Bid To Rule Them All?
Could this be the real reason Optus submitted its own bond? The head spins with the possibilities, and I just wonder who else is going to chicken out of Terria before the 26 November NBN submission deadline. More to the point, I wonder who, having stuck around for sunrise on the 27th, will wish they hadn't.
If Terria can't stop the attrition of its major partners, maybe Optus should just pull the plug altogether and force the government into some sort of sudden-death decision. After all, the government couldn't possibly complete the tender process with just one eleventh-hour submission from Telstra, resigning the country to a lifetime of monopolistic price gouging.