NBN and Telstra Collaborate to Offer High-Speed Broadband in Australia

Australian government-owned National Broadband Network (NBN) announced that it has reached an agreement with Telstra for a high-speed national broadband network.

The deal will provide NBN access to Telstra’s current infrastructure. Under the deal, the Australian government will pay AU$9 billion to Telstra for getting access to the latter’s infrastructure including ducts, wires, and pits. The government will also pay an additional AU$2 billion to help Telstra build a new company for executing the agreement. This deal would enable Telstra to shift its customers to fiber-optic network from cable network.

The Australian government expects Telstra to split its retail and wholesale businesses for diluting its dominance in the market. Accordingly, the government has launched a legislation related to the move.

The government had previously proposed a plan to offer 100 Mbps broadband service to the majority of the Australian schools, homes, and business via optical networks within eight years. However, Telstra’s role in this proposal is ambiguous at present. Telstra had started negotiating with the Australian government last year.