Conroy announces five NBN test sites, Telstra shares sink after attack on Government’s plan

The Government has named the five locations across the country which will act as test sites for the upcoming National Broadband Network, with each location set to receive internet connections of over 100mbps.

The announcement comes just after Telstra attacked the draft legislation outlining the regulatory framework of the NBN Company, saying it goes back on the Government’s promise to keep the firm as a wholesale-only body.

Communications minister Stephen Conroy announced Willunga in South Australian, the inner-city Melbourne suburb of Brunswick and certain areas of Townsville will be included in the trial-run.

The remaining two areas were cited as the coastal communities of Minnamurra and Kiama Downs, and parts of the western district of Armidale in New South Wales.

Conroy said in a statement the announcement shows the Government is proceeding as planned on the network and that it was an “important milestone” which will provide “crucial information” for the rest of the project.

“NBN Co will be using the first sites to test different construction techniques to suit different geographical regions across Australia,” he said.

“The NBN will drive major productivity and growth opportunities right across Australia and ensuring the rollout is successful is critical to getting this infrastructure delivered efficiently and successfully.”

Conroy said in the statement he expects these areas to be connected to super-fast broadband by the end of next year, when the test sites have completed construction. The network is expected to be operational across the country by 2018.

The statement comes as Telstra’s shares have hit an all-time low of $2.88 today after the market reacted to the letter sent to shareholders from the company outlining its reaction to the Government’s draft NBN legislation.

Chief executive David Thodey and chairwoman Catherine Livingstone said in the letter the legislation allows provisions for the NBN Company to act with a retail component, seemingly backtracking on the Government’s promise to keep it wholesale-only.

“Such an outcome 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 letter said.

“We are very concerned about this potential change in the government’s position. If enacted, we would need to factor this into the financial consideration required to achieve an agreement that is in the company’s and your best interests,” the letter said.

“Our concerns about the potential shift in NBN Co’s scope will be strongly and clearly stated in our submission on the draft legislation due on March 15.”

The comments are certainly a problem for the Government, which has been in negotiations with Telstra regarding the transfer of some of its network for use in the NBN. But Conroy said in Sydney today negotiations are still ongoing and no deadline has been set.

“This is an extraordinarily complex set of negotiations. It’s not like you can draw on anywhere else in the world,” he said. “This is a set of negotiations that no one has ever attempted before, so it’s no surprise to me that we’re still in negotiations.”

But comments from Telstra today which stated the draft legislation would make an agreement harder to achieve indicate a deal may not be on the horizon for some time.

It is expected the Senate will debate the draft legislation in a few weeks.