Coalition to pay Telstra faster than NBN Co

Summary:Shadow Communications Minister Malcolm Turnbull has claimed that Telstra would be paid faster for its copper network under the Coalition's broadband plan than under the current $11 billion agreement with NBN Co.

Shadow Communications Minister Malcolm Turnbull has claimed that Telstra would be paid faster for its copper network under the Coalition's broadband plan than under the current $11 billion agreement with NBN Co.

Earlier this week, Turnbull indicated that under the Coalition's broadband plan for fibre to the node (FTTN) for most existing premises in Australia, the Coalition government would acquire from Telstra the copper line between the node and the premises.

In response, Communications Minister Stephen Conroy questioned how Turnbull plans to renegotiate with Telstra to pay for this part of its network.

"Valuing assets is always tricky. In this case, it comes down to either what price Telstra is prepared to accept or what price a court would consider 'just terms' for the acquisition of property," Conroy said.

This morning, NBN Co CEO Mike Quigley told ABC radio that an FTTN network would be "quite difficult to achieve", and that "Telstra are not keen to sell" the copper network.

Turnbull said in a subsequent interview on ABC radio that NBN Co failed in its negotiations with Telstra to secure the right to use the copper, when instead it will just become obsolete when the customer is moved across to the fibre and Telstra is paid as part of the $11 billion deal with the government. Turnbull said that he doesn't think there would be any problem to renegotiate to get the copper from Telstra.

"I don't foresee any problems in reaching that agreement with Telstra," he said. "If you had a fibre to the node deployment ... take the copper, agree to have access to the copper, Telstra would actually be paid for decommissioning its network sooner. It wouldn't get paid any more, but the payments would come in sooner, because you would be able to roll out your network upgrades faster."

Turnbull also took aim at Quigley's comments that 758,000 premises would be passed or be under construction in 2012.

"It's a very slippery use of language. In the fibre business, there are really two metrics that are relevant. One is how many premises you actually have connected and are actively using a service, and the other is how many premises you have passed."

Turnbull said that claiming construction would commence for 758,000 is not a true indication of houses that will be actually connected to the NBN in 2012.

"You may as well say construction is underway for 12 million households. It's this Orwellian language; they're not being straight."

Quigley this morning defended take up on the network, saying that 25 per cent uptake — 5500 of the 18,000 premises connected — would be an envious result in the telecommunications industry.

"Take-up rates on the fibre are ahead of what we expected," he said. "Telcos around the world would be quite envious of those sorts of numbers."

Topics: NBN, Broadband, Government : AU, Telcos, Telstra

About

Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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