Telstra wins Australia's NBN contracts; talks over 'significant' deal under way

AUSTRALIAN telecom giant Telstra has agreed to commence negotiations with the country's National Broadband Network (NBN) company on a "significant contract" to manage the design, engineering, procuring and construction of NBN's hybrid fibre-coaxial (HFC) that falls within Telstra's network.

In addition, Telstra has also been awarded two operations and maintenance services jobs for NBN, with work beginning in early 2016. Combined, the two contracts are worth A$80 million (S$81 million) in first-year revenue.

Telstra revealed these in a filing to the Singapore Exchange on Monday before the market opened.

The memorandum of understanding (MOU) signed between the two companies will see them negotiate to finalise a contract that covers the design, engineering, procurement and construction management of the NBN network in the HFC footprint covered by the existing Telstra HFC network in Australia. This contract is expected to be completed in early 2016.

The MOU also includes an agreement for Telstra to undertake some early works to support the building of the NBN network in the HFC footprint while the contract is negotiated. This will include preparing Telstra NBN exchange locations and HFC planning and design work.

The first of the two new contracts is over three years, and involves fixing faults on the copper network and undertaking a small number of new connections for services that are yet to transfer to the NBN.

The second is over four years, and sees to the fixing of faults and connecting new services on the NBN for the Fibre to the Node (FTTN), Fibre to the Premises (FTTP), Fibre to the Basement (FTTB) and HFC technologies in select areas once a customer has migrated to the NBN. NBN has the option to extend in both contracts.