NBN 'Cough Up $98bn To Telstra'

Written by Oonagh Reidy     14/04/2014 | 12:20 | Category: WIRELESS & NETWORKING

NBN Co could be forced to cough up $98 billion in total pre-tax payments to Telstra until 2067, CommsDay reports.

NBN That is what the NBN Co's board was told by Goldman Sachs in May last year, when Labor was still in power and the $41 bn fibre to the premises (FTTP) National Broadband plan was in full steam.  

The $98.159 billion of estimated payments to Telstra would occur over the next 55 years between FY2011 and FY2067, with the 2011 payment sum set to treble by 2042, according to the analysis. 

"The bulk of this-some $88 billion-would be for infrastructure leases covering ducts, dark fibre, rack space and conduits," according to the report seen by CommsDay. 

"As the NBN Co footprint expands to cover all of the Telstra copper footprint, these payments would rise: from A$400m annually this financial year, to $1 billion in FY2019 and to $1.6b a year by FY2042. By 2067, NBN Co would be paying Telstra some $2.9 billion a year in lease commitments."

The Coalition's NBN policy, as released last year, would add $2.4 bn or 20% to the value of the Telstra deal, according to Goldman Sachs' assessment.  

NBN Co signed an agreement with Telstra in 2011 to surrender its copper assets to NBN Co, worth $11bn, which is currently being renegotiated by the government.