Feeds

Telstra, NBN Co to sign new deal mid-2014: analysts

FTTN rush job proceeding at a snail's pace

Build a business case: developing custom apps

Australia's investment community has set mid-2014 as the date when it expects the government, Telstra and NBN Co to finalise a new three-way contract over infrastructure access.

If the stock market expectations are accurate, it would be yet another roadblock to the now-dead-in-the-water political promise that all Australians would have access to 25 Mbps by 2016.

According to the Australian Financial Review, stock analysts believe the on-hold status of the National Broadband Network project is going to give Telstra the chance to hold onto its “cash pile” for a year or more. The money the AFR refers to came from its sale of its interest in Chinese Internet business Motorhome.

To those that don't own Telstra shares, the question of whether the carrier pays its shareholders more, or instead pays down borrowings that covered its most recent spectrum purchase, is probably of marginal interest.

However, there's also this revealing remark attributed to Credit Suisse: “Credit Suisse research analyst Fraser McLeish said Telstra and NBN Co would most likely be aiming for a new deal to be finalised by mid-2014”, the newspaper states.

An access-to-copper deal is crucial to the government's plan to replace the original NBN fibre-to-the-premises design with fibre-to-the-node.

Under the original definitive agreement between Telstra and NBN Co, the incumbent was to receive $AU11.2 billion (net present value in 2011), in exchange for giving NBN Co access to its pits-and-pipes (as well as other infrastructure such as exchange access). This would have seen the copper progressively decommissioned as customers were relocated to the fibre connection (with customers to retain their existing retail relationships, and carriers to become wholesale customers of the NBN).

To roll out fibre-to-the-node, NBN Co needs access to the copper, either by purchasing the copper network outright from Telstra, or as a wholesale customer of the naked copper from Telstra – the matter which is now subject to a three-way negotiation between NBN Co, the government and Telstra.

A mid-2014 deal would set the start of the full-scale FTTN rollout – leaving the federal government just two years to achieve its “25 Mbps to everyone by 2016” promise.

That promise was already looking difficult to achieve, with the government's sixty-day review blowing out both the timing and costings promised by the new government. ®

Build a business case: developing custom apps

More from The Register

next story
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Amazon says Hachette should lower ebook prices, pay authors more
Oh yeah ... and a 30% cut for Amazon to seal the deal
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
Nintend-OH NO! Sorry, Mario – your profits are in another castle
Red-hatted mascot, red-colored logo, red-stained finance books
Sonos AXES support for Apple's iOS4 and 5
Want to use your iThing? You can't - it's too old
Joe Average isn't worth $10 a year to Mark Zuckerberg
The Social Network deflates the PC resurgence with mobile-only usage prediction
Chips are down at Broadcom: Thousands of workers laid off
Cellphone baseband device biz shuttered
Feel free to BONK on the TUBE, says Transport for London
Plus: Almost NOBODY uses pay-by-bonk on buses - Visa
Twitch rich as Google flicks $1bn hitch switch, claims snitch
Gameplay streaming biz and search king refuse to deny fresh gobble rumors
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.
Maximize storage efficiency across the enterprise
The HP StoreOnce backup solution offers highly flexible, centrally managed, and highly efficient data protection for any enterprise.