i3 opts against legal action on Brisbane fibre project

Escapes 'political vortex'.

i3 Group has revealed it will not pursue legal action over its axing from the 'sewer fibre' project in Brisbane, despite investing "a lot of money" gearing up for the project.

Chief executive Elfed Thomas told iTnews that the company had taken a "pragmatic" approach to Brisbane and had "no legal concerns".

i3's technology was dumped by Brisbane City Council in February despite an apparently successful pilot. It was reported at the time that Council were unhappy with i3's progress on the project.

"I think we were dragged into a political vortex," Thomas said.

"There was a misconception that we would build [Brisbane] and that's still the case. We had no intention of building it ourselves. We're committed to a consortium approach [to construction].

"We've done all the planning and network structure to do... Brisbane and we've got financial partners interested in building it. As far as we're concerned, nothing's changed."

Although i3 had started out in the business of infrastructure delivery and operation, it had since refocused purely on licensing its fibre-to-the-premises deployment methods, which included fibre in water pipes and micro-trenching.

Thomas said that i3 had "geared up quite a lot" to support the Brisbane project.

While conceding the company had poured resources and investment around the project, he said the "template" created for Brisbane could be applied across Australia, and was developed on that premise from the outset.

"It was a template for the whole model in Australia," Thomas said.

"At the end of the day it's bespoke [for] any city that wants to use it. The model, approach and costings are still alive."

Thomas said i3 was pitching it to other councils, although he noted the company was still ready to step back into Brisbane should the council there reconsider.

However, that could be challenging given the champion of Brisbane's sewer fibre project, Lord Mayor Campbell Newman, quit for a career in state politics. Newman's replacement was named last week.

i3's Asia Pacific office, based in Brisbane, had three senior directors and two project staff, backed by resources from the company's British headquarters.

i3 had kept relatively quiet since the Brisbane project, re-emerging late last week to push its technology as a cost-effective alternative to NBN Co's recently-abandoned construction model for the mainland.

i3 wasn't the first company to push micro-trenching and other technologies as an alternative to rolling out fibre in Telstra's ducts.

Local operator BBNC was also trying to get NBN Co to sub-license micro-trenching technology using a similar business model - and to date, meeting with similar success with the government-backed network builder.

A key challenge for proponents of fibre deployment methods that bypassed Telstra's passive network was the ongoing negotiations between Telstra and NBN Co for - among other things - leased access to the incumbent's pit-and-pipe infrastructure.

While protracted negotiations continued, it appeared unlikely NBN Co would pursue alternate models that effectively isolated one of the two key assets it was trying to negotiate access to (the other being Telstra's fixed customer base).

"At the end of the day it's in NBN Co's hands," Thomas said.

"If they used our technology they wouldn't have to use Telstra. Why are they not using an existing asset [water infrastructure] to save cost and time and stop cities being dug up?

"I'm not saying use it everywhere but I'm 100 percent confident they can significantly lower the cost [of the NBN] using partners and by licensing our technology."

Thomas said that NBN Co's decision to suspend the mainland construction tender process potentially opened doors for i3 on the project.

"Before the 14 [construction firms] had been [excluded] they didn't want to talk to us because of the [prospect of an] NBN contract," he said.

"We'll approach all 14 companies. It's a better place for us than when the 14 companies were locked into the NBN [process]."

Thomas believed some could represent potential partners for local 'fibrecity' projects - of which Brisbane had been positioned as Australia's first.

Thomas said i3 was also in discussions with mobile operators to deploy backhaul networks to their base stations.