Optus signs $350m deal to cut costs

Continuing its series of cost cutting measures, Optus has announced a $350 million contract with Nortel Networks which is expected to cut the telco's network capital expenditure costs by 50 per cent over the next five years.

Under the terms of the latest deal, a five-year supply contract, Nortel will supply dense wave divisional multiplexing (DWDM) network equipment for Optus' long-haul transmission network, which will complete the national rollout.

Nortel will also supply equipment for Optus' metropolitan transmission network including DWDM, synchronous digital hierarchy (SDH) and bandwidth management equipment and next-generation voice switching equipment.

Dr Stephen Rotheram, managing director of networks for Optus, said the agreement would give Optus savings in ongoing support costs for the new generation technologies.

"This is an innovative way for us to manage our networking needs. Not only will we have pricing arrangements in place for at least five years, we will also have reduced day-to-day expenditure on support."

He said that to meet customer demand, Optus expects to double the capacity of its data network in the next two years, with voice expected to double in five years.

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