Telstra and TPG warn against NBN Co plans
Telstra and TPG Telecom are warning a new push by NBN Co into the regional business market could see the company waste money duplicating fibre networks already on the ground.
NBN Co on Tuesday said over a million businesses around the country will be eligible to have fibre rolled into their premises free of charge, as part of a $700 million initiative. Under the announced plan, businesses that fall inside 240 dedicated “business fibre” zones, including those run from home and sole traders, will have the option to get a full-fibre connection free of charge.
It will also see up to 700,000 suburban and regional businesses receive internet services at the same price as businesses in metro areas. Some of these zones are near major hospitals and education facilities. The upgrade is the first sign of NBN Co using some of the $6.1 billion it raised in the private debt market in May.
NBN Co’s plan poses a clear threat to Telstra, which owns and operates most of the networks used by regional businesses, and the telco said that the money could be better spent in upgrading NBN connections for homes.
“We look forward to seeing more detail, however, it is important this investment doesn’t lead to the inefficient duplication or overbuilding of existing infrastructure,” a Telstra spokesman said.
“We also look forward to hearing more about the upgrade path of NBN Co’s existing technology for residential premises, as that will require substantial investment over the next 10 years.”
Meanwhile, TPG said that NBN Co should look to provide infrastructure in areas underserved by private companies rather than build over existing fibre networks.
“However, it is critical that NBN does not overbuild or displace private investments which would have been delivered more efficiently by a competitive market,” a TPG spokeswoman said.
NBN Co’s move has been welcomed by Telstra rivals Singtel Optus and Vocus Group, which view the announcement as a way to increase competition and diminish the telco giant’s monopoly.
Optus vice president of regulatory and public affairs Andrew Sheridan said the investment was in areas where there a monopoly. “It will also provide a much-needed incentive for small- and medium-sized businesses to improve their digital capabilities and infrastructure,” Mr Sheridan said.
A Vocus spokesman said the announcement would be good for competition. “Vocus has consistently argued that NBN has a positive role to play in the enterprise market when it improves competition in underserved areas, improves retail competition as a wholesale-only provider and encourages more private investment,” the spokesperson said.
NBN Co’s announcement comes ahead of the release of its next corporate plan, which will be made public on Wednesday and is expected to have details off a planned upgrade of the residential network.
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Zoe Samios is a media and telecommunications reporter at The Sydney Morning Herald and The Age.
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