Government hopes to save billions on building broadband network

The Australian Communications Minister Stephen Conroy has stated that the government is looking to save several billion dollars on building the National Broadband Network by replacing Telstra’s network.

It was announced recently by the Australian Communications Minister, Stephen Conroy, that the government is looking to save a few billion dollars on the cost of building the National Broadband Network. Conroy said that the government hopes to save between four and six billion dollars, and will look at doing this through taking over and replacing the aging network of Telstra Corp.

Conroy said that legislation will be introduced to parliament later on this month, and he said that NBN Co, which is the company that is building the service and is run by the state, may be able to submit a proposal as early as this week. The projected cost of the project was said to be around forty three billion dollars, but the government wants to try and cut around ten percent of this cost through this measure.

In a recent interview in Canberra Mr Conroy stated: “It is a commonly expected figure of savings of between A$4 billion and A$6 billion. It clearly will be cheaper because it means we don’t have to duplicate Telstra’s existing infrastructure.”

The Prime Minister, Julia Gillard, has proposed a non binding agreement with Telstra, and this proposes shutting down the communication giant’s copper wire network and transferring customers to the NBN in exchange for financial recompense. Conroy went on to state: “Telstra is recommending it to shareholders and wouldn’t recommend it if it didn’t think it was going to be good for the company.”

Source – Bloomberg