Optus claims NBN draft legislation needs significant revision

8 Apr 2010

Australian fixed line operator Optus has sided with its major rival, incumbent Telstra, over proposals for the National Broadband Network (NBN), The Australian reports. It is understood that Optus has said that a number of ‘drastic changes’ are needed to draft legislation before it will commit to the NBN project, with the telco also warning the government that unless clauses allowing the government-owned network to compete in retail markets are removed the venture could fail to get off the ground. The claims, which echo those of Telstra, come as part of Optus’ feedback on legislative proposals relating to the national high speed infrastructure plans. Commenting, Maha Krishnapillai, director of government and corporate affairs at Optus, said: ‘As it stands, the draft legislation provides wide scope for NBN Co to play in the retail market, either at the complete discretion of the minister or by acquiring businesses in its own right. Despite assurances to the contrary, the legislation also allows the opportunity for Telstra to gain a privileged position on the NBN (for example access to better pricing or conditions), jeopardising the promise of improved retail competition.’

In separate but related news, the Sydney Morning Herald is reporting that the negotiations between Telstra and the state over the former’s role in the NBN project remain stuck on issues of pricing. It is believed that Telstra is pressing for AUD12 billion (USD11.12 billion) as compensation for losing its copper network and for granting access to other infrastructure elements it owns. NBN Co is aiming to transfer the incumbent’s fixed line customers to its new fibre network, while it also wants access to infrastructure including underground pipes, ducts and space at telephone exchanges, but the private-public company is thought to have said it will pay no more than AUD8 billion.