Communications Minister, Malcolm Turnbull, has brokered a new deal between Telstra and the National Broadband Network (NBN) that would see NBN Co gain ownership of the nation’s copper and hybrid fibre coaxial (HFC) cable at no additional cost to the taxpayer, potentially allowing faster and cheaper roll-out of the NBN.
Back in 2011, the former Labor Government signed an $11 billion deal with Telstra that required it to decommission its copper and HFC cable network as the NBN was rolled-out. Under Labor’s plan, these assets would have been mothballed.
However, under this new plan brokered by Turnbull, instead of Telstra decommissioning its copper and HFC network, it will instead gradually transfer ownership to NBN Co, thereby giving it the option of using the network to deliver the NBN to homes.
Turnbull claims the new deal will come at no additional cost to taxpayers and Telstra shareholders would not be worse off:
“What this agreement does is ensure that NBN Co’s management have the flexibility to choose the right access technology in every particular circumstance”…
“This should be seen as a win-win. A win for the taxpayer, a win for the consumers, a win for NBN Co and a win for Telstra shareholders”…
“They will ensure that all Australians have access to very fast broadband, much sooner and at much less cost and much more affordably”…
I see no downside and a lot of upside from the new deal struck by Turnbull.
It made absolutely no sense for Labor to decommission the copper and HFC cable network, and then require the building of expensive duplicate infrastructure by NBN Co.
As noted by Adele Ferguson today, the new deal will also give NBN Co more flexibility to decide which is the best way to go in various areas: fibre to the home, fibre to the node using cable, HFC or wireless. It could also shave at least four years off the completion date of the NBN.
The breakthrough by Turnbull, which comes at a time when the Coalition has had few wins and is languishing in the opinion polls, also strengthens his position within the Coalition, and could help in Turnbull’s bid for leadership sometime in 2015 or 2016.
