Optus sticks to 3G plan

August 6, 2004

Optus will not change its plans for the introduction of 3G mobile services and will stick with its mid-2005 launch timetable. The comment follows Telstra announcement on Wednesday that could see Telstra starting 3G services in Australia before Optus.

Optus incoming chief executive, Paul O'Sullivan, said the company held off 3G services because the volume and suitability of handsets won't be available until the middle of next year to make the investment worthwhile. The company expects to have a 3G network built in Australia by the middle of 2005 and will be offering services from then.

"There's nothing we've seen in the last 24, 48 hours that would change our view of the handsets and the availability," he said.

Telstra announced Wednesday it intends to use A$450 million to buy a 50% stake Hutchison Telecommunications' 3G network, which would see the companies split the cost of maintaining and developing the network but still compete in the retail market.

O'Sullivan said Optus also remains open to sharing 3G infrastructure. "Overall we are very open to sharing infrastructure."

He questioned the joint venture between Hutchison and Telstra, saying Telstra paid too much to share Hutchinson's 3G network.

"...Telstra look like they have overpaid because we would do a similar number of base stations for about half the price that they have contributed," O'Sullivan said.

Hutchison has more than 2,000 base stations for its 3G network.

O'Sullivan could not see what obvious benefits Telstra would gain from the deal but considered it to be a reasonably good deal to Hutchison.

Telstra said the deal gives them a tried and tested 3G network for half the cost of building one itself.