Optus’ CEO has tendered her resignation three days after fronting a gruelling two-hour Senate hearing which revealed the company had no plan for its unprecedented network outage.
On 8 November, Australia’s second-largest telecommunications provider Optus suffered a network outage which affected over 10 million customers.
Last Friday, the company’s outgoing chief executive officer Kelly Bayer Rosmarin and managing director of networks, Lambo Kanagaratnam, fronted a two-hour Senate hearing packed with stern interrogations into the cause and handling of the outage.
When asked by Liberal senator Sarah Henderson if she intended to resign following the outage, Bayer Rosmarin initially skirted the question.
“My focus is on the team, the customers, and the community. My focus is not on myself,” replied Bayer Rosmarin.
On Monday, however, a press release from Optus’ parent company Singtel revealed Bayer Rosmarin has since tendered her resignation.
“On Friday I had the opportunity to appear before the Senate to expand on the cause of the network outage and how Optus recovered and responded.
"I was also able to communicate Optus’ commitment to restore trust and continue to serve customers,” she said.
“Having now had time for some personal reflection, I have come to the decision that my resignation is in the best interest of Optus moving forward.
“It’s been an honour and privilege to lead the team at Optus and to serve our customers.”
While the company “embarks on a global search for a new CEO”, Optus has appointed its existing chief financial officer Michael Venter to concurrently occupy the role of interim CEO.
Highly resilient yet unprepared
In its submission to the Senate, Optus explained its network is “highly resilient” with “multiple layers of redundancy protection”, but the hearing revealed the company was not adequately prepared for a full outage on the network.
When asked by Labor senator Karen Grogan if the company had a plan in place for a full outage, Kanagaratnam conceded the company was unprepared.
“We didn't have a plan in place for that specific scale of outage,” said Kanagaratnam.
“It was unexpected. We have high levels of redundancy and it's not something that we expect to happen.”
Kanagaratnam – who heads a network team of about 12 members – further detailed that while the company had performed a network outage exercise as recently as October, it wasn’t for a full outage of the network.
On the day of the outage, Bayer Rosmarin faced widespread criticism for not speaking publicly until a 10.30am appearance on ABC Radio Sydney – more than 6 hours after the outage began.
During the hearing, Bayer Rosmarin was questioned on whether her belated appearance was driven by legal advice, whether she’d been advised to speak carefully in case of compensation, and whether she’d been advised not to admit fault.
Bayer Rosmarin denied having received legal advice on these matters, and said communications had been delegated to the company’s communications team – which she said is comprised of seven people.
“Yes, there's more we could have done,” said Bayer Rosmarin.
Over 200 failed calls to Triple Zero
During the outage, calls to Triple Zero were non-functional when attempted from a landline, requiring callers to use a mobile line instead – however, the hearing confirmed a number of customers were unable to reach the service altogether.
“There were 228 Triple Zero calls that were unable to go through,” said Bayer Rosmarin.
“We have done welfare checks on all of those 228 calls and, thankfully, everybody is okay.”
When asked by Greens senator Sarah Hanson-Young whether Optus was aware people were having problems reaching Triple Zero, Bayer Rosmarin conceded that at 8.35am – 4.5 hours after the incident began – the company “did not have any knowledge” of such difficulties.
When asked why certain customers couldn’t access Triple Zero, Bayer Rosmarin explained the company was “still investigating”.
Meanwhile, the Australian Communications and Media Authority (ACMA) has called an inquiry into the matter.
“We've done some investigations into that, but we can't investigate that ourselves because of the complex interrelationships, so we are really grateful that the ACMA has called an inquiry into this,” Bayer Rosmarin said.
“We're going to work with them.”
Hanson-Young asked if Optus should pay a penalty for failing to provide a critical service to Triple Zero – leading Bayer Rosmarin to explain the company’s role in the system.
"The Triple Zero system is supposed to be able to pick up the traffic when we have an outage like this,” she said.
"We don't run the Triple Zero system, we participate in the Triple Zero system."
Hanson-Young accused Bayer Rosmarin of wanting to “share the blame around”, and further pressed the point of compensation.
“I think we're just going to have to cough up, accept responsibility, apologise and cop a penalty, surely,” said Hanson-Young.
Who to blame?
In its submission, Optus offered more technical details for the cause of outage, explaining some 90 “Provider Edge Routers” – which are used to link a given network service provider's area with areas managed by other providers – automatically isolated themselves in response to an overload of IP routing information.
This unexpected overload came after a software upgrade at an internet exchange run by Singtel – during which Optus’ network received changes in routing information from an alternate Singtel peering router.
When asked whether the upgrade was tested before being rolled out, Kanagaratnam and Bayer Rosmarin explained since the upgrade was done on an international peering network run by Singtel, Optus had “no ability to influence or test” it.
A day before the hearing took place, Singtel denied responsibility for the outage – stating the upgrade “was not the root cause”.
Bayer Rosmarin explained Singtel had in fact agreed and approved Optus’ initial statement on the root cause, and that its later denial of responsibility was more so a clarification of the cause rather than a contradiction to Optus’ explanation.
“I want to make it very clear that accountability does lie with Optus,” admitted Kanagaratnam.
“The outage was as a result of our defences for the change in routing information not working as they should have.”
During the hearing and before the announcement of her resignation, Bayer Rosmarin said 8,500 customers and small businesses had already asked Optus for compensation.
“So far, they've been discussing with us around $430,000 in compensation, and we've already applied $36,000,” said Bayer Rosmarin.
Bayer Rosmarin was unable to immediately clarify whether this compensation had been paid in cash refunds or via in-kind services, and stressed she didn’t want to “make any commitments” on what Optus is going to pay.
When asked about customers who may have suffered consequential losses, and whether Optus’ current offer is significant to its customers – that being, 200GB in free data to be used over the holidays – Bayer Rosmarin said there is no precedent for telcos or other essential providers covering consequential losses.
“I want to make it clear that we have taken immediate and ongoing steps to rectify any shortcomings,” said Bayer Rosmarin.
“I want to assure you, my teams and our customers that we are committed to regaining trust and rebuilding faith in our brand.