Three million dollars and 12 months later, NetComm finally laid to rest its dreams of becoming a broadband telco carrier. Last week NetComm announced on the ASX it has disbanded its carrier subsidiary after a proposed deal to sell a majority interest of the subsidiary to a US investor had fallen through.
While NetComm was keeping the investor's identity under wraps, all eyes are focused on what is to become of the network infrastructure Cisco Systems has so far provided under its vendor financed agreement.
Last year Cisco outbid networking rivals Lucent and Alcatel to back NetComm to the tune of up to $380 million over several years for a host of IP, DSL and network management products.
Meanwhile NetComm's chief financial officer, Vicki Potts, chief technology officer Rob Gillan, and director of sales Chris Hignett have all resigned from the company following the announcement. All three staff were recruited specifically to oversee the business' strategic development and implementation, according to a statement released by NetComm.
"We are naturally disappointed given the advanced state of the project, however, the board did not think it prudent to burden the existing business once allocated funds had been utilised and no immediate funding alternative was apparent," said NetComm managing director David Stewart.
NetComm has invested approximately $3 million in the broadband carrier subsidiary, including a carrier licence, key personnel, commercial agreements with Telstra and a pilot network the statement said.