Telstra & NBN Co in negotiations "at the highest level"

Stuart Corner
Sunday, 30 August 2009 14:06

IT Industry - Strategy

The chair of the Tasmanian NBN Co, (and board member of the national NBN Co) Doug Campbell has revealed that NBN Co and Telstra are in negotiations "at the highest level' for Telstra to become a customer of the NBN and a significant shareholder in NBN Co.

However he said that NBN Co did not plan to rely on Telstra to roll out the National Broadband Network, rather it expected to do this itself. Nor did he discuss Telstra vesting any of its network assets in to the NBN.

He told the ABC's Tasmanian Stateline programme on Friday evening (August 28) "We are very anxious to have Telstra become part of this NBN rollout and we are negotiating with Telstra at the highest levels right now as I sit here and talk to you to have them come on board and use the NBN as their primary backbone network for all of Australia." (This sounds like a slip of the tongue on Campbell's part: the NBN will be an access network, not a backbone network and Telstra has a perfectly adequate backbone network of its own).

Campbell continued: "They are indicating that they are prepared to enter into those discussions and talk to us, but I don't think we would use them for the build itself. We would do that independent of Telstra But we do want Telstra to adopt the network and use it as if it was their own and to eventually migrate their customers onto it. And I believe that will eventually happen as we go through these negotiations that are starting right now."

As iTWire observed recently, the NBN would make an ideal complement to Telstra's Next IP core network and, with its integrated IP and other access networks, its brand, its huge customer base and its access to content, Telstra would be better placed to exploit the NBN than any other telco in Australia.

On the question of Telstra's shareholding in NBN Co, Campbell said: "That has yet to be determined. They certainly won't get more than 49 percent, that is the upper limit. And they wont get anywhere near that because a lot of other people want to buy in. Optus wants a part of it, other ISPs want a part of it and probably Foxtel wants a part of it so the upper limit for Telstra will likely be 25 to 30 percent."

Aurora to be minority TNBN Co shareholder

Campbell was rather more vague on the question that he might have been expected to answer with more certainty: the respective shareholdings in TAS NBN Co to be held by the National NBN Co and Aurora Energy as the Tasmanian Government's representative.

He delivered his answer to the interviewer's question very hesitantly and said: "The percentages of the joint venture will be determined by the value given to us from Tasmania by way of Aurora and what the Commonwealth Government will put in by the way of capital investment to build this whole network. It is probably going to be largely a Commonwealth owned company with a significant minority owned by Aurora."