Double-decker disaster spells trouble for Optus top brass

On the eve of Optus chief executive and the telco’s owner Singtel being hauled into the principal’s office – that of federal communications minister Anika Wells – the timing of the weekend’s second network outage is catastrophic.

The pair of telco executives, Singtel’s Yuen Kuan Moon and Optus boss Stephen Rue, wouldn’t be relishing the upcoming get-togethers with the premiers of South Australia and Western Australia either.

While the latest Optus breakdown, in Dapto, south of Sydney, was limited in scope and without the tragic ramifications that marked the first outage less than two weeks ago, both failures prohibited callers from getting through to emergency services.

Outages happen all the time on a network, but when Triple Zero services are knocked offline, the stakes get a lot higher for all telecommunications companies.

For Optus, and its newly installed chief executive, the two outages in rapid succession have escalated the scrutiny of the telco’s deficiencies. Is it just unlucky, accident-prone or is there a systemic problem at Australia’s second-biggest telco?

To render Rue’s job as the only fatality of the weekend failure would be a punitive fix, one that kicks the can down the road rather than solve the problem. But the chorus baying for Rue’s departure is only getting louder.

The federal and state government ministers are predictably playing to script, with Wells proclaiming that Optus had failed the Australian people, and Prime Minister Anthony Albanese branding the company’s behaviour “completely unacceptable”, saying last week that he would be surprised if Rue wasn’t considering his position.

Shadow communications minister Melissa McIntosh says Rue should quit his job, while the South Australian premier Peter Malinauskas has said he had never witnessed “such incompetence” from an Australian communications company.

There is a host of tangible opportunities for the federal government to punish Optus, ranging from a fine to limiting its ability to participate in the auction of fresh spectrum, and imposing harsher conditions on the company’s licence to operate in the country.

A review into the large-scale Optus outage in 2023, which cost the telco $12 million in fines, produced a series of recommendations, chief among them was to establish an independent manager of Triple Zero emergency systems.

And while this was agreed by the government, the role appears to be not yet fully operational.

Whichever path is chosen, the federal government has the option to impose a punishment that will galvanise the attention of Optus’ parent company Singtel, where the real decisions are made about the level of investment in and staffing of the network.

Optus is only one of several offshore companies owned or controlled by Singtel. It has always considered itself as a challenger company to the dominant Australian telco, Telstra.

There is also the additional wrinkle that Singtel is ostensibly owned by the Singaporean government, so hauling it over the coals has diplomatic implications.

These considerations raise questions over whether Singtel will take a look at selling Optus. There was intense speculation last year, although denied, that Singtel had fielded an offer from Brookfield that fell over after a price could not be agreed.

Meanwhile for Optus, marketing strategies, platitudes, promises and even sponsorships feel hollow if the basic services break down.

In Singtel’s most recent (pre-outage) annual report, Rue said, “the biggest opportunity we have is to do better for our customers and stakeholders, and do it consistently. That starts with regaining trust. We are focused on the fundamentals: exceptional service, reliable infrastructure, competitive offers and disciplined cost and capital management.”

Rue may yet come to regret those words in light of what has taken place over the past couple of weeks, particularly the references to “reliable infrastructure”, “doing better for customers” and “trust”.

For now, Optus could not have dreamt of a worse start to a week – its top brass is going to get a grilling from the federal government and its brand continues to get flamed by the public.

Rue must be getting tired of apologising, but he’s probably going to have to deliver a few more mea culpas before the dust settles.

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