Telstra, NBN Co. ink $121M fiber to the node agreement

Telstra and the NBN Co. have entered a $121 million agreement where they will connect 260,000 premises with fiber to the node (FTTN) technology, an approach favored by the Australian government's Coalition party.  

According to an Australian Financial Review report, the incumbent telco will deploy fiber network infrastructure primarily in regional areas across New South Wales and Queensland. It expects the build of the 1,000-node rollout to take about a year to complete.

A spokesman for Australia's Communications Minister Malcolm Turnbull said that this latest pact does not have any effect on the effort to renegotiate Telstra's existing deal with the NBN Co.

"The agreement . . . represents an interim step while NBN Co, Telstra and the government finalize changes to the existing Definitive Agreements covering Telstra's pa­rticipation in the NBN," a spokesman was quoted as saying in the Australian Financial Review. "It is anticipated these changes will include arrangements for the NBN Co to gain access to Telstra's existing [network]."

The incumbent telco will oversee the buildout and seek help from local contractors. Telstra's chances of winning a large portion of the network are good because it owns the country's embedded copper-based last mile network.

This deal is the latest of moves to drive a multi-technology approach, one that the Coalition party says is more cost effective than the all-fiber method initially developed by the NBN Co.

Australia's Coalition party has devised what it calls an "optimized multi-technology mix" plan that will connect 26 percent of premises with fiber to the premises (FTTP) by 2020, while another 44 percent will be served by FTTN, and the remaining 30 percent by hybrid fiber coax (HFC). 

In December, NBN Co. reported that in its initial trial of fiber to the basement (FTTB) in Melbourne, it was able to hit speeds of 108/48 Mbps.

For more:
- Australian Financial Review has this article

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