Telstra wants a piece of national broadband network

Telstra is likely to start negotiating with the Government over the national broadband network, saying it could sell parts of its phone network to the Government’s NBNco. The telecommunications giant, which previously refused to negotiate with the Government over the network, wrote in a submissions paper that it may offer some parts of its infrastructure. […]

Patrick Stafford 27 May, 2009

Telstra is likely to start negotiating with the Government over the national broadband network, saying it could sell parts of its phone network to the Government’s NBNco.

The telecommunications giant, which previously refused to negotiate with the Government over the network, wrote in a submissions paper that it may offer some parts of its infrastructure.

“Telstra has indicated that it will consider vending in assets, which may include regional transmission, in exchange for equity in NBNco,” the submission said.

“Providing access to existing infrastructure, rather than building duplicate infrastructure, reduces the risk of stranded transmission assets once the NBN is built.”

The Government has previously said that it would prefer telecommunications companies to sell assets to NBNco to reduce the $43 billion cost, but until now Telstra has not commented on the issue.

Optus is also apparently negotiating with the Government about selling assets to the NBNco.

The submission was in response to the Government’s regulatory review plans to pay other telcos $250 million to duplicate Telstra’s networks, in order to break its dominance of the market during the eight years it will take to build the NBN.

The regulatory review would also plan to split Telstra’s wholesale and retail companies apart.

The plans to duplicate the network came from fears that Telstra would compete with the NBN with its own existing infrastructure. But the company said that a competition between the two entities would ultimately hurt the NBN.

“The proposal for duplication is well intentioned, but it is unlikely to address underlying economic issues and may make implementation of the NBN more complex and costly,” Telstra’s submission said.

“As one alternative, Telstra believes a priority for the Government funding should be the extension of the fibre transmission network into under-served areas rather than duplication of existing transmission infrastructure.”

Submissions for the regulatory review are due next week.