By Jai C.S.
TMCnet Contributor
Telstra, a telecommunications and information services company in Australia, has signed a major deal for a superfast national broadband network. The deal will focus on the rollout of the new broadband network that would be faster, cheaper and more efficient. This $9.6 billion deal is said to enable the government-owned company building the new network, the National Broadband Network Co., or NBN, access to existing infrastructure owned by Telstra Corp. (News – Alert), which controls the national communications network.
As mentioned, the government will pay Telstra AU$9 billion for access to infrastructure including pits, ducts and wires, and a further AU$2 billion to help Telstra set up a new company to implement the deal. Telstra will also be able to move its customers from its existing copper wire and cable networks to the new fiber-optic one. Telstra has been offering a complete range of services serving the telecommunications markets throughout Australia, and reaching more than 8.8 million Australian customers via fixed line and 10.3 million mobile customers, including 7.2 million 3G services. Earlier, the government of Australia had announced a plan to deliver broadband speeds of 100 megabits per second to 90 percent of Australian homes, schools and businesses within eight years through fiber-optic cables connected directly to buildings. Telstra, a former government-owned monopoly that controls the aging copper wire system that is Australia’s national communications network was roped in to take this project further. Negotiations, as stated, started last year. Alternatively, the government of Australia also wants Telstra to further dilute its market dominance by splitting its wholesale and retail businesses, and has introduced legislation to encourage that move. The company is resisting, arguing it has a duty to shareholders to keep its businesses intact. The deal is yet to be approved by Telstra shareholders and Australia’s competition regulator.
Jai C.S. is a contributing editor for TMCnet. To read more of Jai’s articles, please visit his columnist page.
Edited by Erin Harrison
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