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Rivals want to invest in Australia's broadband network

What's that, Skippy? Telstra not happy?

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Some of Australia's top telecoms companies want to club together with incumbent Telstra to invest in upgrading the nation's broadband network.

The telcos - Internode, Macquarie, Optus, PowerTel, Primus, Soul and TransACT - believe proposals put forward by Australia's dominant telco are bad news for consumers and competitors.

In a nutshell, Telstra's plans to invest in five major cities serving some four million homes and businesses. But rivals say this will "divide Australia into the digital haves and have-nots," with less than half of all phone lines able to receive the new high speed services.

Worse still, Telstra also wants to be given something in return for its investment and rivals are concerned that this will mean restricting competition and higher prices for end users.

Instead, rival operators are putting together a plan that would pool resources and provide a "collective investment in an open access network" that could be used by all broadband providers.

"Under our proposal, Telstra would be joined by other telcos and internet service providers in making the necessary investment to upgrade the existing copper local loop into a high bandwidth fibre to the node network," said David Tudehope, chief exec of Macquarie Telecom.

"This approach will deliver high speed broadband services to more Australians, more quickly, than if the new network was a Telstra monopoly."

Michael Simmons, boss of Soul, said: "Telstra has offered Australia a false choice: a high speed broadband network owned by a monopoly provider; or preservation of the existing market structure involving several competitors, but with no increase in broadband speeds."

Instead, the rival operators that have long-battled with Telstra for access to its network say their proposal will deliver improved broadband competition, better prices and product innovation tanks to the creation of a "genuinely national, open and competitive broadband network".

The Government is understood to be keen to hear further details of the plans, but Telstra has already rubbished the proposals.

A spokesman for the telco told The Age that the proposals were a "self-serving, pickpocket plan to rip off Telstra's shareholders and taxpayers. What they are doing is becoming the ultimate parasite on Telstra's network." ®

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