Telstra says NEXTG network share is a no-no

7 Nov 2006

Australian incumbent Telstra will not share its AUD1 billion (USD774.6 million) HSDPA network with its 3G infrastructure partner Hutchison 3G (H3G) or any other of its rivals, chief executive Sol Trujillo told Bloomberg. ‘This is a network that Telstra has built, and others can build their own,’ Trujillo, said in an interview in Beijing on Friday. ‘We wouldn’t expect to be on somebody else’s network if they risked capital to do that.’

According to TeleGeography’s GlobalComms database, Telstra was one of six 3G licence winners in March 2001, and in August 2004 it purchased a 50% stake in the 2100MHz W-CDMA network of rival H3G, enabling it to launch high speed mobile services without the initial costs associated with building its own network. W-CDMA services were launched over the shared network in September 2005, but by mid-2006 Telstra’s 3G customer base was less than a third of that boasted by H3G. Fearing that its relative slowness in rolling out 3G could cause it to lose its grip on the market as a whole, Telstra has invested heavily in rolling out 3.5G technology in the form of the country’s first HSDPA service, which it launched in October 2006, three months ahead of schedule to catch its rivals off guard. The network, christened NEXTG, operates in the 850MHz band and covers over a quarter of Australia’s landmass and more than 98% of the population — which makes it the largest HSDPA network in the world by Telstra’s reckoning. Cannily, the 850MHz spectrum is not covered by the network sharing agreement with H3G. H3G aims to rollout HSDPA services by upgrading the shared 2100MHz network in Sydney and Brisbane by Christmas. Vodafone launched HSDPA shortly after Telstra, though its coverage is much more limited. SingTel Optus launched HSDPA trials in Canberra in conjunction with Nokia in late October and is expected to launch commercially in early 2007.