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OPTUS is finalising its planned $100 million ADSL deployment, but a new international deal has added a twist to the project.
The Australian has learned that Optus is close to naming its preferred equipment vendor - from a shortlist comprising British company Marconi and upstart Chinese player Huawei Technologies - after a 12-month search.
A third hopeful, US company Lucent Technologies, was knocked out of the bid late last year over problems with existing equipment.
It is understood that Optus has approval from the board of its parent, Singapore Telecommunications, to spend up to $100 million. However, insiders say the first phase of the roll-out would cost between $30 million and $80 million. The initial phase of the project involves installing ADSL equipment in 300 Telstra exchanges.
By building its own ADSL network using copper wires rented from Telstra, Optus will be able to offer customers always-on, high-speed internet services, voice over IP and eventually, video on demand.
Analysts said the combination of Optus and other telcos building ADSL networks could cut Telstra's revenue by as much as $300 million.
Sources close to the Optus plans, codenamed Project Bigfoot, said Optus's local management favoured the Marconi bid but executives at SingTel were in the Huawei camp.
The twist, however, is that Marconi and Huawei have now hooked up to form a partnership - the latest in a string of alliances between Chinese vendors and their European and US rivals. Huawei already has alliances with German vendor Siemens and US internet equipment maker 3Com.
Huawei is offering telcos around the world bargain-basement prices as a way of moving into global markets. People close to Project Bigfoot said Marconi had been forced to cut its offer by as much as 20 per cent.
As well as exploring ADSL, Optus remains in negotiations with Foxtel over the possibility of Optus adding Foxtel's digital pay-TV service to its product sheet.
Foxtel and Optus executives met late last week to discuss Foxtel's latest wholesale discount offer.
 News source: AustralianIT
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