Telstra to begin renegotiating NBN deal shortly

14 Jan 2014

Australian fixed line incumbent Telstra, the government and NBN Co, the firm overseeing the National Broadband Network (NBN), are expected to begin formal discussions within a fortnight with a view to rewriting the AUD11 billion (USD 9.94 billion) deal under which Telstra will take part in the broadband project. The Australian cites Telstra chief executive David Thodey as having confirmed that discussions about leasing or selling the telco’s copper network to NBN Co would begin soon, with the executive stating: ‘We are keen to get going on the government’s multi-technology mode architecture and we will hopefully start conversations when everyone is back on deck after the break.’

With Australia’s Coalition government, which took power in the latter half of 2013, seeking to scale back the original NBN plans of the Labor party, the existing copper and cable networks of Telstra and Optus will be key to the new strategy, which aims to use a mix of technologies to deliver download speeds of at least 50Mbps to more than 90% of the nation by 2019. Under the project, which is expected to cost AUD41 billion, the Coalition plans to deploy fibre to cabinets that will connect to Telstra’s copper network and link into homes, and as such NBN Co will need to access the copper and cable networks, which will be preserved and upgraded to offer better broadband services.

Negotiations on reworking the NBN contract are reportedly being headed up by Telstra’s former regulatory boss, Tony Warren, while the fixed line incumbent is also said to have re-enlisted long-time broadband adviser Macquarie Capital to assist in its discussions. Meanwhile, Bill Morrow, the former CEO of Vodafone Australia and now NBN Co chief will take part in the talks, along with former Telstra chief executive and current NBN Co chairman Ziggy Switkowski.

Australia, NBN Co, Telstra (incl. Belong)