NBN Co retail legislation could pass July

NBN Co chief executive Mike Quigley

Legislation that could allow the National Broadband Network (NBN) operator to sell retail services could be in place as early as July.

The NBN Co Exposure Draft Legislation allows Communications Minister Stephen Conroy to exempt a service from the previously stated wholesale-only rule originally sold and packaged with the NBN, essentially turning the NBN Co into a retailer.

Conroy told Computerworld the draft legislation could be passed and out of parliament by mid-year at the earliest.

While Conroy reiterated that the NBN Co is a layer two wholesaler, the proposed legislation will allow it to sell services to “certain end-users; for example, government agencies'', according to the memorandum.

The legislation ruffled the feathers of Telstra which sells telecommunications services to government. CEO David Thodey said yesterday the proposal “would run counter to the core purpose of the NBN and the government’s primary policy objective of restructuring the industry to have separate providers for retail and wholesale fixed network services”, the latter argument referring to tough talks between Telstra and the government about supplying its infrastructure to the NBN.

Conroy said yesterday the government would consider Telstra’s concerns over the legislation’s potential to set the NBN Co up as a broadband retailer.

“The reason we issued a draft proposal was to get industry comment… we look forward to robust comment,” he said.

“Telstra’s share price went below three dollars before this bill [was issued],” Conroy said responding to questions around whether the Draft Legislation had excessively affected Telstra’s share price.

“Mike (Quigley) and I are engaged constantly with Telstra in dialogue. I don’t believe there are any games being played at all. The negotiations are extraordinarily complex,” he added commenting on the state of current negotiations with Telstra over the split of the company.

Quigley added that recent speculation that the retail prices of NBN services would far higher than current broadband pricing was "ridiculous".

"We will be pricing at market to be competitive to get people on to the network," he said.

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