The National Broadband Network Company has awarded three separate contracts worth over $1.6 billion to technology companies to provide manufacturing support and equipment over the next five years of the network’s construction.
But the NBN Co. has also come under fire today after Prime Minister Julia Gillard said the government-owned entity should remain free from freedom of information laws.
“My understanding is that this is the ordinary operation of the Freedom of Information Act; that a body like NBN Co would not be subject to it,” Gillard said today.
NBN Co. chief executive Mike Quigley announced yesterday the three companies to be awarded some of the first tenders are Warren & Brown Technologies, Prysmian and Corning Cable Systems.
Sandy Mennie, general manager of engineering at Prysmian, says the new contracts will allow the company to create 50 new jobs and will require an expansion of its existing manufacturing facility, as the required “ribbon” cable is not currently made in Australia.
“The products that we’ll be making are new to Australia. This is ribbon fibre cable, so the challenge for us will be to create an expanded manufacturing facility.”
“The other challenge will be logistics. But we have experience in that area, we operate Australia wide, and we have the opportunity to provide services for the entire country.”
Prysmian has operated since the 1880s, when it made submarine telegraph cables. The total value of the new contract will come to $300 million over five years, with an initial purchase order of $150 million.
Warren & Brown Technologies is a Melbourne-based fibre optic equipment manufacturer, which has been awarded contracts worth up to $110 million over the next five years. The company will provide optical distribution frames and sub-racks.
The firm says its research and development facilities have allowed it to fulfil orders in short timeframes, with chief executive Neil Domelow saying the company has come a long way during the past three years after being hit hard by the financial crisis.
“It was very difficult three years back, when the world economy was heading down, for Steve Normoyle and I to proceed with the $5 million upgrade to our facility. But winning this NBN Co contract proves that our belief in the future of telecommunications fibre technology was justified.”
The US-based Corning Cable Systems won a $1.2 billion, five year-contract to provide the actual fibre cables for the network. Managing director Rainer Dittrich said in a statement the new investment in its facilities will allow it to create 300-400 jobs in the Melbourne suburb of Clayton.
The company has already provided equipment for the first NBN test sites, and will expand its operations over the next five years, along with manufacturing specialised “ribbon” cable.
Quigley said in a statement the contracts were awarded to the three companies to spur more investment in local manufacturing – a sector which has slowed over the past year.
“NBN Co is pleased to award these contracts to three companies that are leaders in their fields and to increase local investment in Australian manufacturing.”
“Part of our purchasing strategy is to make a substantial up front purchase commitment to encourage suppliers to invest in their Australian supply chain ramp-up as we head to volume rollout. They can invest with confidence in plant, equipment, recruitment and training to meet the needs of our national project.”
But the NBN Co. has come under fresh scrutiny today after Julia Gillard said the company should remain exempt from FOI laws, as it is an incorporated entity.
“My understanding is that this is the ordinary operation of the Freedom of Information Act; that a body like NBN Co would not be subject to it,” Gillard said today.
“I think with freedom of information laws, we have the system, the system is there, the system is one where something like NBN Co is not covered by them so it’s just ordinary business.”
But both the Opposition and the Greens have taken issue with those remarks, with the Coalition communications spokesman Malcolm Turnbull telling ABC Radio today he will intend to bring the fight to parliament.
“This is not a private company that the government has taken an investment in, this is a company that has been established for the sole purpose of fulfilling a government policy.”
Greens communication spokesman Scott Ludlam also said he would seek to bring amendments before parliament that would make the NBN Co. subject to the laws.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
