NBN Co backhaul ticked by telcos

Fringe areas may become financially viable

Telcos have backed NBN Co's proposal to lease backhaul fibre from Telstra as part of the $11 billion Financial Heads of Agreement deal announced this week.

The deal, should it receive a tick from Telstra shareholders next year, will grant National Broadband Network (NBN) wholesaler NBN Co access to Telstra’s network pits and the “right” to its backhaul fibre.

iiNet managing director, Michael Malone, said the NBN could not be built without access to Telstra’s backhaul.

“The NBN Co wants to be the single provider to all locations but only Telstra has backhaul to all regions,” Malone said.

“It would use its own backhaul where there is no competition, and would certainly look to competitors in metropolitan areas, especially where there is dark fibre available.

“The only change to us is from an exchange to a house — the rest is evolutionary — and we are not being asked to rip out our network.”

The move will increase backhaul coverage to fringe regional areas, according to Optus regulatory spokesman, Maha Krishnapillai.

“The [lower-priority blackspots] in regional areas may become commercially viable in which case we could build out backhaul,” Krishnapillai said.

“If we can get to Darwin for a decent price, rather than the eye-watering extortion that we pay now, we may build out from there.”

Krishnapillai said the Federal Government has addressed many critical backhaul blackspot areas, such as building a second Alice Springs to Darwin link which he expects will lower haulage costs by up to 90 per cent.

He expects telcos will build additional backhaul to areas that are served by a single backhaul link as a result of the deal.

However, RMIT University network engineering program director, Dr Mark Gregory, said the deal was tantamount to a government blank check for Telstra.

“Telstra still owns the network and leasing access is a bad idea — a sunken idea,” Gregory said.

“[The Federal Government] should have built its own backhaul and left Telstra alone. The idea of a second network was very viable."

Gregory accused the Federal Government of rushing through the deal in the wake of its struggling Mining Super Profits Tax legislation, and called for the government to remove gag policies and make the entire deal public.

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