SingTel – BT

Optus reaches A$800m pact with NBN Co

Switch to Australia’s upcoming high-speed fibre-optic network

SINGAPORE Telecommunications unit Optus has reached an A$800 million (S$1.1 billion) pact with the Australian authorities to phase out its current Internet infrastructure and switch over to the country’s upcoming high-speed fibre-optic network.

The agreement with state-owned National Broadband Network Company (NBN Co) will see Optus progressively move its hybrid fibre coaxial (HFC) customers over to NBN Co’s new digital superhighway from 2014.

Optus will receive the A$800 million payment in tranches as its customers make the switch, Optus said in a statement yesterday. Optus based its estimate of the total value ‘on a post tax net present value basis’.

NBN Co has been appointed by the Australian government to equip the entire country with ultra-fast broadband connections.

Under its NBN plan, 93 per cent of Australian homes will be wired up with new fibre-optic links, while the remaining 7 per cent is to be connected wirelessly.

According to the Optus statement, the migration over to the NBN is expected to take up to four years.

Optus will continue to offer broadband services via its HFC infrastructure – which relies on a combination of fibre-optics and slower copper wiring to provide broadband and pay-TV access – until the new network is completed and all its subscribers have been migrated.

The move affects only the firm’s fixed-line residential and small business customers.

In tandem with the migration, it will gradually decommission parts of the HFC network that are not used to support its mobile services and enterprise clients, the operator added.

‘This agreement represents a fair deal for Optus. We intend to use the NBN to turbo-charge competition and to deliver the full potential of a 21st century digital life to customers,’ said Optus chief Paul O’Sullivan.

An A$11 billion agreement was also struck between NBN Co and Optus rival Telstra.

Under the contract, the country’s largest fixed-line operator will grant NBN Co access to its copper-based infrastructure for at least 35 years to help with the deployment of its new digital highway.

In addition, Telstra has agreed to progressively switch off its copper-based network and move its services over to the NBN.

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