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Aussies a huge step closer to UFB

23 Jun 2011

Australia’s two largest telecommunications companies, Telstra and Optus, have agreed to participate in the Australian government’s National Broadband Network (NBN), in a move which brings Australian consumers a big step closer to ultra-fast broadband. 


Under the Telstra deal, the company will disconnect its copper network, switching those services onto the NBN over the project’s 10-year build period. Telstra expects the deal to deliver up $A11bn ($NZ14.2bn). 


Meanwhile, Optus has also agreed to migrate its customers from its Hybrid Fibre Co-axial Cable (HFC) network to the NBN from 2014, in what it says is an $A800m ($NZ1bn) deal.


Both deals are subject to the approval of the Australian Competition and Consumer Commission (ACCC), and Telstra still has to receive signoff from its shareholders in a vote that will take place at the company’s AGM in Sydney on October 18.


The Telstra deal is the result of two years of negotiations. Telstra chairman, Catherine Livingstone, says that in the final analysis the government’s proposal will recover more value for the business than the alternatives.


"After rigorously assessing the options before it, including the regulatory and commercial implications of each, the Telstra board expects to recommend that shareholders approve a proposal to participate in the NB rollout, subject to the conditions precedent being satisfied,” Livingstone says.


Optus chief executive Paul O’Sullivan says the creation of the NBN will lead to a level playing field for telecommunication companies.


"Australian consumers will be the winners,” O’Sullivan says.

Photo from WABN.