Apparently it is not in the market to take any risks. But in that case perhaps it should consider vacating its position and letting somebody else do it. We believe it is impossible to make totally risk-free investments, especially if you want to play in the national arena.

As we see it, there are two options:

• Those who build infrastructure take a risk by having to make long-term investments with uncertain outcomes.
• Those who use the networks of others make a risky investment because they have to capture as many customers as possible, since margins will always be low. If you play this game you will need to be able to build a business model around whatever margins are available. If you don’t grab the opportunities you won’t be able to play the game in this market

As we have been saying for many years – ever since AAPT started to falter, soon after it was taken over by Telecom New Zealand – you must either be serious about it and invest, or you should retreat and create a niche market, eg, trans-Tasman traffic.

Now, nearly a decade later, AAPT still doesn’t seem to have made a decision, which is disastrous for the Australian operation. In the meantime it has lost over $2 billion on the investment.

The ‘naked DSL’ announcement demonstrates to me that AAPT has given up on the Australian market. We expect it will soon start selling off assets and begin a retreat to the trans-Tasman market.