Telstra-NBN deal timing called into question

Telstra-NBN deal timing called into question

Summary: Questions have been raised as to whether the deal between the National Broadband Network Company (NBN Co) and Telstra can be completed by 20 December, at which point the deal would be terminated.

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Questions have been raised as to whether the deal between the National Broadband Network Company (NBN Co) and Telstra can be completed by 20 December, at which point the deal would be terminated.

The government, NBN Co and Telstra signed definitive agreements in June, which see Telstra lease its ducts to NBN Co and move its customers onto the network in return for $11 billion. This deal was dependent on a shareholder vote and ACCC approval of a structural separation undertaking (SSU) from Telstra, which lays out how the company will separate its business units so that they don't operate in a vertically integrated fashion.

Reports in the Australian Financial Review and The Australian this morning quoted sources saying that delays with providing a revised structural separation undertaking would put a spoke in the wheels of the deal, as the Australian Competition and Consumer Commission (ACCC) now no longer has enough time to deliberate over any undertaking it receives before the deadline.

However, Telstra released a statement this morning saying that although it had yet to submit a revised structural separation undertaking to the ACCC, it is still in deliberations with the ACCC, and it has an eye on the time that it has remaining.

"Telstra is currently considering the time needed to complete the conditions precedent. Should an extension to the end date be required to provide the ACCC time to conclude its consideration of the SSU, then Telstra will communicate it to shareholders when such an agreement is reached with NBN Co."

Much of the NBN roll-out depends on this deal, as NBN Co executives have said that without Telstra's ducts, it would cost a lot more to build.

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

Suzanne Tindal

About Suzanne Tindal

Suzanne Tindal cut her teeth at ZDNet.com.au as the site's telecommunications reporter, a role that saw her break some of the biggest stories associated with the National Broadband Network process. She then turned her attention to all matters in government and corporate ICT circles. Now she's taking on the whole gamut as news editor for the site.

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Talkback

6 comments
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  • The accc should have never been allowed to negotiate, the government should hasve brought in a new body to deal with this.

    Lets hope wiht accc mucks this upo that what happens the government will dismantle the accc
    bob hob
  • Telstra and the NBN Co will decide if an extension in time is necessary for the ACCC to make its decision on the Telstra RSS.

    Considering the calamitous result of a Telstra/NBN Co not being able to consummate the proposal I would think Senator Conroy will expedite proceedings.
    sydneyla
  • The ACCC has made some poor decisions on the roll out of the NBN (eg points of interconnect). Is it coming to the end of its life? In any case why should a decision as big as the break up of Telstra in the bigger plan of the NBN rollout over ten years or more, have to be made in just a few more days.
    Goldie248
    • Goldie the decision on the Telstra/NBN Co agreement must be made with urgency because the future of the Gillard Government depends on it.

      It is critical that the NBN roll-out is at an advanced stage at the next election so as to allow the Labor Party to claim a successful delivery to the Australian people.

      Without the Telstra agreement, and heavens forbid, with Telstra as a competitor, the proposed NBN would be be greatest disaster for Australia and the Labor Party.

      With all due respects to the ACCC, the Government is the master of the ACCC, and through Senator Conroy must advise the ACCC to reach an early decision.
      sydneyla
      • The ACCC is set up as an independent statutory body. It's a slippery slope once the government start dictating terms to it.
        mwil19-a34f7
  • Not dictating mwil19 just requesting, there is a vast difference.
    sydneyla