As well as selling AAPT's consumer division, Telecom said it had sold AAPT's 18.2 per cent stake in iiNet to institutional investors for A$70 million, A$11 million less than its carrying value as at June 30.
Combined with the proceeds from its sale of 10.1 per cent of Macquarie Telecom announced yesterday, the deals will realise about A$140 million.
Telecom had reportedly been seeking more than $400 million for AAPT as a going concern.
It will now concentrate on running AAPT's fibre network and the wholesale and business divisions, it said.
The sale of the consumer unit will reduce 2011 forecast earnings for AAPT by A$10 million, Telecom said.
AAPT was expecting earnings of A$101.3 million for the year to June.
Telecom CEO, Paul Reynolds, said: "Together these transactions rationalise non-core assets, strengthen Telecom's financial position, and help reposition AAPT's operations into a focused, network-centric wholesale and corporate business that is well-positioned for future growth."
A Telecom spokesman said the company was now ''taking stock''.
''We're happy with the transactions we've made,'' he said.
''That's not to say if a good offer [for the rest of the business] was put in front of us we wouldn't look at it seriously. But having done these transactions, which we're pleased with, we'll take stock.''
The buyer of AAPT's consumer business, listed Australian telco iiNet, said it expected the acquisition to boost earnings by A$20 million in the first full year.
AAPT's 113,000 broadband subscribers and 251,000 other connections would bring its broadband customers to 652,000 and total active services to 1.3 million, it said.
iiNet will continue to buy wholesale services from AAPT.
The transaction requires approval of iiNet shareholders and an extraordinary general meeting is expected to be held in September.
My 500GB main disk died. No click of death. No warning from SMART. Nothing.
The disk had been running a little poorly for the last few months - an unfortunate fight between ACPI and APM meant it's XP partition was never the same again.
But this morning - nothing. Not even a parting goodbye.
The darn thing won't register. I doubt it's even spinning up.
Now, it wasn't completely unexpected.... I have a new 1TB drive with Vista Ultimate on it (and please don't start on why not Win7... I did not have $400 spare) that I was progressively moving to, at a speed the wife would accept.
So now we're on Vista, I have a dead HD I'm wondering to do with, and a lot of stuff to migrate very quickly.
But it got me thinking about the cloud, for the first time in a long time (especially given it's my job to have my head in the clouds).
I've lost no email. My precious media of the children is on a seperate HD (which is about to be backed up AGAIN!). But I would love to be able to have a safe store for what is important to me and my family.
With my TelstraClear Cable Internet, I can restore my email and any PC pretty easily - although getting Vista and the apps patched up again came to about 3GB in a day - but for real content? forget it. WHo can offer me 1TB of storage? and what Internet service can I use to upload that amount of info?
A home server might be the answer... but that also has a hard disk that will eventually die. On the story goes.
I've been struggling to think about what use a fast fibre network could be. This is one of the uses.
But then economic reality steps in... my wife says she'd pay $30/month to back our data. That's real world consumer expectation, and she doesn't care what's involved in making it happen.
SO who will be first with a 100Mbps Internet service and unmetered 1TB in the sky. $30 a month up for grabs.....
And streams _very_ well at HD on my cable connection at home...
Under the heads of agreement announced this afternoon, Telstra would provide access to Telstra facilities and progressively migrate Telstra traffic onto the National Broadband Network, subject to regulatory approval. The agreement for these terms will have an approximate value of $9 billion.
Separately, the Federal Government has agreed to progress “public policy reforms” with an attributed value of approximately $2 billion. These basically involve changes to Telstra’s current universal service obligations with the establishment of a new Commonwealth entity – USO Co – which will deliver unprofitable services. USO Co will receive a maximimum of $100m in annual taxpayer contributions with the rest to be funded by presumably increased industry contributions. It will take over Telstra’s USO obligations from 2011.
Telstra also said it has received a written agreement from the government that it will be able to participate in LTE spectrum auctions under the deal.
“This is a sound outcome for NBN Co because when finalised it can maximise the use of existing infrastructure and accelerate the roll out of its network,” NBN Co CEO Mike Quigley said in a press release.
NBN Co added that Telstra would likely become its largest customer. NBN Co will pay Telstra for migration of traffic on to the NBN and the decommissioning of its network.
The Heads of Agreement also provides for NBN Co’s use of Telstra’s “existing fit-for-use infrastructure, such as ducts, pits and conduit and a right to acquire Telstra backhaul services and space in Telstra exchanges. While there is a considerable amount of negotiation and contractual work to go, we believe this agreement is a significant step forward to creating a more competitive telecommunications industry,” Quigley said.
Telstra expects to be able to place the deal to a shareholder vote in the first half of next year. The deal is subject to both that vote and ACCC approval.
About this time 9 years ago, I was sitting in a management meeting with my Director of Marketing, and we were reviewing the latest iteration of a truly dismal situation. The telco bubble had burst, 3G was a bust, and a huge internal project to install GPRS and MASSIVE ISP infrastructure had just gone through it's 3rd rescoping. From the hubris of a fully connected world where everything ran off a PDA - a state the world only managed to get to in 2009 with the iPhone 3GS - came the realisation that the only proposition available was. basic colour WAP over GPRS, using the classic Ericsson T65 handset.
Out of sheer frustration, my director uttered the immortal words in his best James Bond "Gentlemen. I want a killer app in 2 weeks". a meeting that still amuses me to this day, although it was anything but funny at the time (the project bill by this point was bordering on ?55m). Since that time I have many more 'amusing' meetings, where out of sheer frustration at the world of complexity, decisions have been made to pursue a technology or a specific way of selling come hell or high water, hoping this eventual silver bullet will prove to be what unleashes torrents of success and money.
A little bit like throwing $48bn at a fibre network (Australia) or $10bn (NZ - you didn't think the country would be rewired for less than that, did you?). This is the silver bullet to unlock all our problems. Especially if you actively destroy the existing technology and force everyone to start again.
Or maybe deregulating the Building Act, to make it faster cheaper and easier to build new houses. now there's a silver bullet to get the economy going. Too bad that people don't get the difference between treated and untreated timber, or what living in NZ's wet climate really is like (we have been here for a great many years. not that much has changed!)
The expression, 'No Silver Bullet', comes from a book written by software engineer Fred Brooks in the 80's. He wrote
".there is no single development, in either technology or management technique, which by itself promises even one order of magnitude [tenfold] improvement within a decade in productivity, in reliability, in simplicity." While Brooks insists that there is no one silver bullet, he believes that a series of innovations attacking essential complexity could lead to significant (perhaps greater than tenfold in a ten-year period) improvements.
Over the christmas break - while having a ball with my Telecom XT connection - I read a book called 'How the Mighty Fall' by Jim Collins. His main premise was that successful companies get arrogant, start to decline but fail to recognise until the decline is too late, then throw resource and money at the problem until it's fixed. which almost never happens, and they carry on as 'zombie' companies until closed down or sold off. Basically you'd have to be spectacularly bad to fail outright. it's more a case of gradual decline. Probably true for a large corporate trading on old successes.. I think smaller companies don't have this sort of luxury!
So how many companies s do you see out there lurching from strategy to strategy, product launch to product launch, always consuming more and doing more but never quite seeming to succeed?
Success is'nt about just striking the right mix - although that's important to. It's about endeavouring to understand your market, trying, adjusting, reflecting, going back and refining and keeping at it. It's about consistency mixed with execution. It's about staying the course and holding your nerve, and not backing away when it starts to look hard. And it's about trusting the people around and beneath you, while also supporting - and verifying - that things are on the right course. It's also about communicating widely and taking feedback from all places - not just those you work with day by day, but everyone. If the cleaner can tell you what you're about - you know a lot of effort has gone into living and breathing what you're doing.
It may not be widely known, but Apple launched the iPod in 2001, as a followup to the nascent MP3 market started by the Diamond RIO (I had one of those. good gadget). But they applied continuous effort to innovation, change, and were lucky enough to have some powerful management able to leverage content. In 2003 iTunes went Windows. In 2004 the 15GB iPod's came out, and then things really started getting interesting.
Imagine sitting in that meeting at Apple in 1999, with a Director proclaiming "Gentlemen. I want a killer app in 2 week", and proposing what iPod has become. Brass ones for sure.
Bring on the Broadband.