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NBN + Telstra Sign Off On New $11B Deal After Snap Press Conference

NBN + Telstra Sign Off On New $11B Deal After Snap Press Conference

Media had previously been led to believe the deal would be announced later this week. No clear explanation was given for the sudden and unusual rush to a Sunday airing, held on the 21st floor of the Commonwealth Parliamentary Offices in Bligh Street, Sydney.

The new deal replaces the one signed between Telstra and the former Labor Government in 2011. It doesn’t change the essential amount Telstra will receive, which remains at $11 billion – but instead of decommissioning its copper and handing it over in one go to NBN Co, Telstra will now gradually transfer ownership to NBN Co, and receive payment over time.

NBN Co plans to use the copper to deliver its controversial fibre-to-the-node technology to many household and businesses, rather than the faster fibre-to-the-premises technology.

The Government claims the new plan will save about $30 billion and speed the rollout by around four years.

However the deal may also come with another price. NBN Co under the deal will progressively be responsible for upkeep of the copper network, some of which is reportedly in poor condition.

While Telstra has a big contingent of network service technicians, NBN Co current has none. Presumably it could hire some of the Telstra techies now facing retrenchment – but that would require new levels of funding, and not all the techies will get jobs.

However Telstra has said it remains in discussion with NBN Co on matters of “planning, design, construction and maintenance services” on commercial terms.

NBN Co has also inked deals with Telstra and Optus to progressively take control of their HFC cable networks in major capital cities and use them for NBN connections. But Telstra is guaranteed access to the HFC lines to deliver Foxtel services.