Nbn And Telstra Agreement

Telstra and Optus continue to use their HFC networks, with Telstra retaining access to HFC to supply Foxtel Pay-TV, while the company will continue to use fibre optics in the Optus contract to connect to mobile base stations and business customers. In combination with the Australian government`s political reforms, Telstra estimates that the agreement announced today will allow Cestra to re-value a net worth of about $11 billion. Payments from NBN Co to Telstra would be made over several years during implementation. The agreement is structured to speed up the use of the nbn™ network. The Multi-Technology Integrated Master Agreement (MIMA) partners are set up and Telstra uses its knowledge of the existing network to manage and coordinate construction activities on behalf of nbn. NBN Co also signed an agreement with Optus for its HFC network, which it said was equivalent to US$800 million in 2011. The amended contracts must be approved by the Australian Competition and Consumer Commission and the Australian Tax Office. Telstra and Communications Minister Malcolm Turnbull today announced the new signing of the pioneering agreement, in which NBN co will continue to provide $5 billion in infrastructure payments, $4 billion in separation payments and $2 billion in Commonwealth agreements. The value remained “essentially the same” as the original $800 million agreement, Optus said, although the timing, nature and purpose of NBN Co`s payments to Optus would vary under the new agreement.

The new deal will come into effect as soon as the ACCC approves the plan and the Australian tax office nBN Co and Telstra will make a private decision on the final agreements. “This agreement ensures that NBN Co management has the flexibility to choose the right access technology in all circumstances. Making a rational business decision, and that`s of course how to build projects like this. Both agreements must be approved before being concluded by the Australian Competition and Consumer Commission and the Australian Tax Office. This is what is expected in the first months of 2015. As part of the revised agreements signed today, NBN Co will gradually take over the networks that will be used in the NBN multi-technology mix for the same net current values of the initial agreements. The new agreement also provides for Telstra to separate the premises from its copper and HFC broadband networks into the digital footprint, but instead of being able to shut down the networks, NBN Co will take over ownership of copper and HFC to use where it deems it appropriate for its multi-technology NBN deployment. Turnbull said the deal today NBN Co offers inflexible options to choose which technology should be used below the initial value of the deal.

Telstra chief David Thodey said Sunday that the agreements took more than a year to be concluded. Much longer than Turnbull expected before the last election, due to the complexity of the three types of technology, rather than the value of the deal. Telstra will cede ownership of its copper and hybrid fibre coaxial networks, while committing to separate structurally under final renegotiated agreements with NBN Co, which maintain the value of the $11 billion agreement reached in 2011. The amendment will allow Telstra to denounce the new final agreements and claim damages from NBN Co if the deployment is cancelled once 75 to 92 per cent of the premises have been adopted.