The Federal Government dumped its original plan for a fibre-to-the-node national broadband network – not just because, as was said at the time, the tenders weren’t up to scratch – but because it faced a possible bill of $35 billion: much the same as it is outlaying for the current fibre-to-the-premises network, Comms and Broadband Minister Stephen Conroy revealed on ABC-TV last night.

But it took a three-State aerial pursuit by Conroy to persuade PM Kevin Rudd to back the FttP proposal.

Conroy told the Four Corners program the original FttN proposal would have required the Government to cut Telstra’s copper network, thereby appropriating its property rights and requiring compensation.

“The Government could spend $15 billion to build a fibre-to-the-node network (and) pay $15 to $20 billion to Telstra for compensation,” Senator Conroy.

“Then Telstra could take that money and build a fibre-to-the-home network past you [in cherry-picked areas] and strand 70 per cent of $15 billion on the side of the road.”

Former Telstra corporate spokesman Phil Burgess confirmed that’s just what would have happened. “Absolutely, that’s the way competition works,” he told Four Corners. “The only way they could have stopped us was write a law against it.”

Conroy told how, after a Telstra tender for the FttN network had been excluded as not complying with the requirements, and no other tender was deemed suitable, he pursued Kevin Rudd from Sydney to Melbourne and then from Melbourne to Brisbane aboard RAAF VIP jets, setting out options to persuade the PM to move to the FttP model, pitching it as a chance to build the world’s best network.

Rudd eventually told him to go ahead, and the current NBN project was born – at 30,000ft.

Four Corners host Kerry O’Brien described the Government’s relations with Telstra, under Sol Trujillo and Phil Burgess, as “poisonous” – the antithesis of the relations with the current management under David Thodey, which has negotiated an $11 billion deal, which – if approved by shareholders – will see a structurally separated Telstra lease use of its copper network and pits and ducts to NBN Co.

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