The Basslink undersea fibre-optic cable linking Tasmania to the mainland could become operational from early 2009, after a long-awaited agreement was inked today between the key stakeholders involved in the endeavour.
"[Electricity utility] Aurora Energy and [CitySpring-owned] Basslink have today signed a contract under which they will each deliver nationally competitive broadband services to Tasmania," the pair said in a statement issued this afternoon.
Basslink and Aurora said they expected the cable to be operational early in 2009, with commercial services expected to commence in the first half of the year after a substantial implementation program over the next few months.
The agreement finally puts paid to what many in the telecommunications industry have seen as a lengthy and delayed process to commercialise the cable, plans for which were initially drawn up in 2000. In August 2007, Singaporean company CitySpring Infrastructure Trust, bought Basslink for over $1 billion.
Since that time little has happened, as the Tasmanian government, Aurora and CitySpring entered and became bogged down in negotiations for an agreement about commercial terms for lighting the cable. While the cable lies stagnant, internet service providers wanting to operate in Tasmania have had just one choice for backbone links, Telstra. The lack of price competition has forced a number of ISPs to exit the state and others to drive prices up.
"The joint agreement will mean Basslink and Aurora will both compete with Telstra and with each other in providing wholesale capacity between Melbourne and Tasmania's main population centres," the pair's statement said today, adding they were confident the deal would bring "competitive" backbone prices to Tasmania.
Aurora chief executive Peter Davis said with state government assistance, the utility would invest in the Tasmanian end of the solution, via a fibre rollout alongside its new gas pipeline across the state, as well as interconnecting the link with its existing fibre cables.
State premier David Bartlett said in a statement the deal was a "massive step forward" for Tasmania's economic growth opportunities, as well as being a moment in history similar to the installation of hydro-electric power plants in the state almost a century ago.
"I have consistently said as Premier: bringing competitive broadband to Tasmania is of the highest priority," Bartlett added. "I am very pleased to be able to tick that box and say we have delivered, but this is only the beginning."