NBN Co eyes Telstra South Brisbane fibre

NBN Co eyes Telstra South Brisbane fibre

Summary: Telstra's controversial South Brisbane fibre network may potentially be sold to the National Broadband Network Company (NBN Co) as part of the $11 billion definitive agreement between the incumbent telco and the government wholesaler.

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Telstra's controversial South Brisbane fibre network may potentially be sold to the National Broadband Network Company (NBN Co) as part of the $11 billion definitive agreement between the incumbent telco and the government wholesaler.

Telstra moved to replace its copper network to some 20,000 homes in the South Brisbane area with fibre optic cable following an agreement with the Queensland Government to close the South Brisbane exchange and sell the land to the government for a new hospital. In June, the telco began switching on services for customers, and the whole upgrade is expected to be completed by the end of 2012.

The negotiations underway between the two companies to sell this fibre network were outlined in a joint letter (PDF) to the Australian Competition and Consumer Commission (ACCC) regarding the $11 billion definitive agreement, first reported by Communications Day.

"Under the [implementation and interpretation deed], Telstra and NBN Co have agreed to negotiate terms of an agreement for the deployment of fibre in the South Brisbane Exchange Area to facilitate the build of the [fibre to the premises] network covering the South Brisbane exchange serving area, including the price to be paid for the deployment of that fibre," the organisations explained in the letter.

"This is likely to include the sale to NBN Co of the fibre network built by Telstra in the South Brisbane exchange serving area, as well as terms and conditions relating to the provision of fibre services in that relevant area."

Telstra told CommsDay that the telco had planned to try to sell the fibre network to NBN Co since the project was first conceived. Telstra declined to add anything further on the negotiations when contacted by ZDNet Australia.

Around 40 per cent of the customers in South Brisbane are currently served by other telcos wholesaling services through Telstra. Telstra has been in discussions with these ISPs to migrate services across from the copper network to the fibre. iiNet has reluctantly agreed to transfer its customers over, but has slammed the incumbent for failing to offer all the features that customers currently get on the ADSL2+ services, such as FetchTV.

NBN Co had not responded to requests for comment at the time of writing.

Topics: NBN, Broadband, 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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3 comments
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  • Makes sense. I predict that TransACT will be eventually be absorbed too... and the sky will not fall due to this.
    Hubert Cumberdale
    • Yes, no sky-falling required! When viewed in context, Telstra's actions in BUILDING the South Brisbane fibre network make perfect sense.

      A combination of factors, including the agreement to sell the land where the old exchange is located and the need to do remediation work after the floods, meant that this was the logical choice. In short, Telstra could either:

      1. Replace copper wiring to a new exchange (noting that fewer exchanges are required due to the inherent properties of fibre networks vs copper), which would then be replaced with NBN Co fibre within a few years; or

      2. Build a GPON fibre network to NBN Co standards, which requires less physical infrastructure in terms of exchanges (in the short term), and represents a far more valuable asset to sell to NBN Co (under agreed terms, no doubt).

      And it's notable that the pricing and services offered by Telstra on its fibre are quite woeful (check out the apples-to-apples comparison offered by Exetel - who have published retail prices for NBN fibre and the Telstra South Brisbane fibre).

      If you want to have a glimpse at a nightmarish alternate universe where Telstra remains as is and continues to dictate unfair terms to other providers, while leaving consumers with absurd price hikes, that's what you should look at as Exhibit 1.
      Gwyntaglaw
  • "Telstra told CommsDay that the telco had planned to try to sell the fibre network to NBN Co since the project was first conceived."

    That had been my guess, but they should have said so from the beginning, instead of making everything think they were trying to maintain their monopoly in the SB area and jack up prices.
    midspace