Two bids lodged for Australia broadband network
SYDNEY (Reuters) - Australia's two largest telecommunications firms lodged bids on Tuesday to build an around $6 billion fast broadband Internet network that would give a much-needed boost to the country's infrastructure.
Telstra Corp, the largest phone company, and main rival Optus, owned by Singapore Telecommunications and backed by a consortium called Terria, said they had lodged bids with the government to build the National Broadband Network (NBN).
Australia has slower and more expensive Internet access than many developed countries and officials have warned it may become less competitive without faster, nationwide coverage. Vast distances in Australia and often inhospitable terrain however make full penetration difficult.
The NBN project has also been beset by political wrangling, while the global credit crisis has cast doubts on the ability to raise funding and on the government's pledge to provide A$4.7 billion ($3 billion) toward the cost of the network.
Telstra, a former state monopoly which controls most of Australia's telecommunications infrastructure, pledged to spend A$5 billion to build the network.
"Telstra is the only company ready today with the very substantial resources and the commitment to deliver a precision engineered and reliable NBN in a timely way," Chairman Donald McGauchie said in Tuesday's statement.
Telstra's willingness to bid has been in doubt, as the company has linked any bid to assurances it would not be forcibly split up.
The Terria consortium has been leading calls for Telstra to be forced to split its networks business from its retail and wholesale arms to promote competition.
Shares in Telstra traded up 2.2 percent at A$4.21 in a broader market down 0.5 percent weaker.
In May three groups lodged $5 million bonds to allow them to bid; Telstra, Optus and Terria and Optus alone.
An Optus spokesman would not comment on whether it would launch a bid outside of the Terria consortium.
($1=A$1.55)
(Reporting by Adrian Bathgate)
