Telstra also offered analysis from several US experts in its submission, including a former senior executive from Sprint, James Sichter, who said that the US experience clearly shows that structural separation is a costly diversion.

Telstra's Mitchell said the reason structural separation occurred in countries like Britain, the Netherlands, Sweden and Denmark is because there have been bottlenecks that allow the incumbent to take advantage of competitor's access limitations.

"The whole thing that changes with a new NBN is those bottlenecks will be removed - the limitations that we have in exchanges will no longer happen."

However, managing director of Telarus, Jules Rumsey, told Computerworld that he feared a Fibre-to-the-Node network as proposed by Telstra would simply lead to a repeat of exchange space limitations, this time within the node cabinets.

"With FttN, where you've got fibre down to somewhere in the neighbourhood or business district and then copper from there to the premises, the cabinet is going to be restricted in terms of space, heating and cooling. There aren't going to be opportunities for other players to install infrastructure in some or all of those cabinets," Rumsey said.

Telstra agrees that a Fibre-to-the-Premises network would be ideal, but is simply too costly to build except in greenfield locations.

"We agree FttH would be ideal, but the financial realities of building that would blow the costs out amazingly. When you're talking already between $15-25 billion just to do FttN, the increase to do FttH would escalate that to a level we believe is not financially viable," Mitchell said.

Group managing director of Telstra Wholesale, Kate Mckenzie, assured the government in its submission that the incumbent was fully committed to an open access NBN that would result in equivalent access to all retailers, providing a platform on which all providers, including Telstra, could innovate and differentiate the services they choose to offer and compete on service and value.

"The core wholesale services will be made available to access seekers on a basis equivalent to Telstra's own business units," she said.

The Coalition has launched a senate inquiry into the government's National Broadband Network (NBN) proposal to evaluate its effects on competition, amid industry criticism that the NBN tender documents are too vague to ensure the network will be open-access and pro-competitive.

Other submissions in Telstra's proposal to the government include:

• Maintaining the integrity of the network, which means the Government should not try to slice up the network and give different elements to different providers and the Government should not force the network operator to accommodate old and new technologies, which are not compatible;
• Given the critical importance of telecommunications to public safety and national security, bidders must be able to demonstrate how their plan will provide for emergency services, particularly during the migration phase;
• Unnecessary regulation aimed at legacy networks should be removed;
• Land access arrangements need to be streamlined to facilitate the deployment of more than 50,000 nodes; and
• Important consumer protection and social policy objectives must be properly identified and funded.

"Building the NBN is an enormous task - the biggest infrastructure build ever undertaken in Australia - bigger than the Snowy Mountains scheme. It will require billions of dollars of investment, more than 50,000 nodes and the rollout of more than 100 thousand kilometres of new fibre," McKenzie said.

"Telstra stands ready to build it. We have the technology, the know-how, the expertise, the resources and the track record of getting things done, but the Government needs to bed down the regulatory changes needed to attract the investment. Without decisiveness, there is a real risk this thing won't happen.