Making the NBN pay
In a major project with such far-reaching political and social implications, NBN Co can't afford to go lightly on its financial and product planning. The company has dived deep into Australia's base of telecoms analysts, product development experts and commercial strategists to build a team whose basic role is to make the NBN pay for itself.
A key player in this effort is Tim Smeallie, head of commercial strategy, who comes to NBN Co after stints in telecoms research at Citigroup and UBS. He has also held the role of finance manager at both AAPT and BT. He started his own telecoms analyst firm, Numerico Advisory, after leaving Citigroup in November 2008 after which he was an outspoken observer on the NBN and everything around it. Among his past roles, Smeallie was reportedly involved in planning with the Acacia consortium, which launched a bid for the initial fibre-to-the-node NBN in 2008. These roles gave Smeallie the financial and telecoms industry background he will need to engage with the industry on a commercial basis, largely with Telstra and its NBN team.
NBN Co scored a major coup by winning a commitment from Jim Hassell, a seven-year veteran of Sun Microsystems' Australia and New Zealand operations who relinquished the reins for some personal time — and home renovations — in late 2007. Hassell started at Broadcast Australia in 2009 holding roles of COO and interim CEO, but left it again to become NBN Co's head of product development and sales director this year. The role will see him driving the strategies that will engage the retail service providers necessary to keep the lights on at NBN Co. Hassell can draw on his channel, product and sales experience gathered during years at Sun and IBM to spruik the NBN's benefits to the industry and all-important partners.
Quigley once described her as "sharply dressed", but former McKinsey & Co principal Christy Boyce is clearly sharp in other ways as she heads towards her first full year as NBN Co's head of industry engagement.
An alumnus of Sydney University's Women's College, Boyce has worked on behalf of the government for years. For example, she co-authored a 2002 report entitled "Australia: Winning in the Global ICT Industry" prepared for then-comms minister Richard Alston.
That report put forward the belief that Australia's ICT industry would succeed most with "a combination of visionary leadership, long-term determination, sensible government policy, effective coordination and cooperation across a range of industry stakeholders, risk-taking by those in the best position to take it — and a lot of hard work". We're not sure whether this perspective continues to drive Boyce's philosophy in her industry engagements, but she is clearly a woman who recognises the need for proactivity and change.
The chief financial officer (CFO) position has been filled by long-time Quigley associate and ex-Alcatel-Lucent CFO Jean-Pascal Beaufret. Beaufret is no stranger to government enterprises: a former Treasury executive in the French Ministry of Finance, his portfolio included export, credit negotiations and development aid as well as government debt management and financial industry regulation. In 1997 he was even appointed as general manager of the French tax administration.
But not all was good at Alcatel-Lucent: Beaufret's departure came in the wake of 4000 job cuts made as part of a major cost-cutting and restructuring effort to turn around the companies' flagging per-merger operations. Beaufret orchestrated major changes that promised €1.7 billion in pre-tax cost savings over three years — but at a cost of 12,500 jobs, far higher than the 9000 initially estimated. Reports say that, in the wake of three successive profit warnings, stakeholders had begun baying for Beaufret's scalp, but that he had the support of Alcatel's board, being referred to as "one of the best CFOs in the industry".
When he left Alcatel-Lucent in 2007, CEO Patricia Russo called Beaufret a "terrific professional" and thanked him for "experience and dedication to this new [merged] company [which] have helped us through the difficult, early stages of this complex merger while dealing with a challenging market".
Given his history, Beaufret brings both the financial experience and the government nous to steer NBN Co's financial ship through the rough waters ahead. However, his pedigree does raise its own issues: having two senior ex-Alcatel-Lucent executives in senior positions at NBN Co was always going to raise eyebrows among those watching for conflict of interest — which is why Beaufret joined Quigley in withdrawing from deliberations over the Gigabit Passive Optical Network (GPON) equipment supply deal that will put up to $1.5 billion into Alcatel-Lucent's coffers.