Telstra hedges bets on NBN uncertainty

Uncertainty remains for NBN as Telstra progresses $11 billion deal

Telstra has assured all measures of uncertainty are covered in negotiations with NBN Co and the Australian Government around an $11 billion financial heads of agreement that will separate the telco structurally and remove it from the competitive wholesale market.

The deal, delayed several times over the past eight month, progressed this week with the telco confirming it had agreed to key commercial concerns with relevant parties, particularly around stability of copper pricing should the National Broadband Network (NBN) go ahead.

The company's chief executive, David Thodey, told media and analysts at the telco's half-yearly financial results briefing that the deal would now be subject to documentation before going to a final approval by the consumer watchdog and shareholders on 1 July.

(Telstra's copper could be recycled: Quigley)

Thodey has continued to impress that regulatory certainty remains key to the success of deal, allowing Telstra to ensure its retail division does not suffer as a result of the loss of vertical integration across telecommunications.

Key parts of legislation passed through Parlimament last year and continued negotiations with the Australian Competition and Consumer Commission (ACCC) have also provided those measures.

When continually asked whether a possible coalition government and the potential cancellation of the NBN could affect those plans, Thodey ensured such uncertainty was accounted for in all negotiations.

"You need to look at many contingencies about change in technology, chage in politics, change in a large number of things," he said this week. "We will handle that as we come and we've got to balance what we do in the short term over the long term and all that is covered."

Possibility of a divided network between NBN and existing copper should the NBN be scrapped by a future coalition government were among those situations accounted for, Thodey said, but he refused to specify the measures in place to solidify Telstra's revenues in such uncertain situations.

During questions from the media, Thodey refused to be drawn on personal thoughts about the NBN's cost or technological viability, saying he believed Australian needed to "move forward in terms of fast access".

"I think there's many ways that hat can happen... My job is to maximise value for shareholders... that's what i've got to be focused on," he said.

Follow James Hutchinson on Twitter: @j_hutch

Follow Computerworld Australia on Twitter: @ComputerworldAU

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Tags Telstra chief executive David ThodeyDavid ThodeyNetworkingNational Broadband Network (NBN)telcosTelecommunicationsTelstraNBN

More about Australian Competition and Consumer CommissionAustralian Competition and Consumer CommissionetworkQuigleyTelstra Corporation

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