John Linton ....before we have properly made the changes to deliver the latest business services.
We completed Day Two of the review of the Sri Lankan operations and made some further progress in putting in place new actions that that should result in further improvements to the way the company operates here. We will see what more can be done over the remaining two days and also determine what further interaction needs to be put in place to allow further increase in the generation and implementation of ideas from all SL personnel. It looks likely that we will make far more changes in the coming dew months than we have made in our total time in Sri Lanka to date.
I read with interest the announcement by TPG that they had begun to buy up iinet shares and have a 4.4% holding at this time. What TPG's eventual intentions are would be unknown to anyone beyond a small number of TPG executives/board members but companies don't buy shareholdings in competitors as general investments. Having said that, both Amcom and AAPT both bought much larger shareholdings in iinet in the past for reasons best known to themselves at the time but subsequently divested them - for different reasons. At the current iinet share price and dividend yield it seems unlikely that TPG sees iinet as a sensible general investment opportunity. Time will tell but as iinet doesn't provide any sort of differentiated product or service offering to the Australian market it has no real value other than a customer base that another company could make more money from by dumping the excessive expenses associated with operating the company.
I suppose it is inevitable as the 'NBN2' begins to show some signs of affecting the ADSL marketplaces more changes to the ways current service providers operate will become apparent. One of these changes may well be a consolidation of the remaining residential providers with the inevitable changes a completely new government monopoly must bring in to being. Any real change will, of necessity, not occur until the next Federal election determines whether the electorate votes for or against a continuation of the Gillard 'government' and its litany of incompetencies among which is the 'NBN2'. If a Labor government is elected then it would seem, at least to me, that there will be more than a few changes to the way, and by whom, communications services are provided to residential users. Among the more obvious changes will be the number of suppliers under whatever wholesale arrangements come in to being. It would be a brave person who cared to spell out what the new arrangements might be.
I have been giving some thought to what impact the 'NBN2' might have on small/small medium/medium business users once services become available in major business areas. In theory, a 100mbps/40 mbps line would be a serious threat to the current remaining SHDSL services but more seriously the current and projected EOC services not just on a cost basis but because of the implicit requirement to discontinue the PSTN lies that EOC requires to operate. My time in Sri Lanka is partially being spent on planning the development of providing and supporting EOC services to medium/medium large businesses in Australia. EOC represents a really large opportunity fpr someone but we are already seeing the effect of TPG's fibre offering and how it affects the EOC market. Obviously an NBNCo fibre offering would have an even greater impact and it is something that is very important to get exactly correct.
In theory, an NBNCo fibre offering will be much, much lower cost than the TPG fibre offering.
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