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Stephen Conroy joins the 7.30 Report -

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(generated from captions) it is a battle of the cabled

trefns and it seems it is far

from over. To discuss the

broadband network we are

joined by the responsible

minister Stephen Conroy. This report assumes a public

company will be a monopoly

wholesaler of broadband

services doesn't it?

Absolutely. The region for

advancing this is to

completely restructure the

telecommunications sector.

Due to some poor policy if

the Hawke-Keating Government

and the Howard Government -

so this stretches back over both previous governments they created a structure in the telecommunications market

today which has seen

Australians getting more

expensive and slower

broadband than they should so

we fundamentally believe the structure of the market is

wrong and we need to fix it.

Hat happens if someone

competes with your Monopoly?

We are putting forward the

National Broadband Network to

build fibre to the home.

Ultimately there is a string

of options, suggestions and

recommendations. We will look

at all of these over the next

few month about how we can

work possibly with Telstra or

go it alone as the report

suggests and so there is a

whole range of options

Stilton table. But the underpinning assumption with

this report that is no-one

competes with this network?

The report believes the NBN

would be a wholesale-only

Monopoly. A simple question

- what happens if Telstra

competes even on its copper

service? If they choose the

make that decision they will

be competing with it. This is

a study based on the no deal

with Telstra. This is a

stand-alone proposition, it

is not underpinned by a deal

with Telstra stow the

services that will be

provided with be a state-of-the-art fibre

technology which will

ultimately super seed the

copper network and what the

report suggests is that

ultimately Telstra will start

using the network as

consumers begin to desire a

better quality of service. I

understand all of that but if

Telstra does compete with

your monopoly fiction in all

of this fall apart don't

they? I think you making a

jump. There the long-term

assumption is there would be

a deal which could see

decommissioning of copper

potentially but the working

assumption is there is competition with Telstra so

you have jumped two steps

rather than what the reported

a vow Kate. But if you do not

get Telstra to come on board it will be far more

expensive. This is the high-end forecast. The report

looks at all the potential

scenarios and puts in a

conservative high-end figure

and that is what is projected

in the $43 billion, it could be cheaper depending on a

number of potential outcomes.

What we also have said from

day one is there is no

question that a deal with

Telstra would see a cheaper

build and a faster build. We

have said that from the day

when announced the plan. But

you have to spend $26 billion

of taxpayer money to get to

where Telstra is and what if

they want to compete with the

Government then the numbers

thin report fall apart? Again

I think you are making two

jumps rather than what the

report is stating. The report

states this is a stand-alone

proposition, a stand-alone

proposition and that the

economics of the sector will

ultimately see Telstra using

the network because consumers

and the applications that

people are going to start to

demand and start to want to

be able to use are only go

tock able to be used on a

piece of fibre. Since you

came to power Telstra's share

value has dropped by $19

billion. What will happen to

Telstra's share price if you

completely bypass it? If I

was a Telstra shareholder I

would be disappointed about

the fact that $ever Telstra

lost $2, 40 of its share

value under the tenure of Sol

Trujillo and I think Telstra

shareholders are rightly

concerned of Sol Stoll fighting with both

governments t Howard and the

Rudd governments have

achieved. What we have seen

is that Telstra chose to

exclude itself from the

original tender process. That

was a decision they made.

Their share price dropped

substantially in the days

after. That they were

decisions made by Telstra

management under Sol Trujillo

S what we are seeing here is

the possibility and the

recommend dancing fact to try

to reach a deal with Telstra.

We have always believed...

Are you confident?. We have

always believed there is a

win-win. There is a win for Telstra shareholders and a

win for all of us in - and

possibly going to be on the

table. We have been

negotiating hard for four

mofnlt I'm sure there will be

further negotiations, it is

complex, this is a deal that

no-one else has done around

the world but I would not

want the make a prediction at

this stage. This report says successful implementation

will require sustained focus

and accurate evidence in the

next four years. Whaeftd is

there that the Government is

capable? We have hired a

world class-C EO. He rolled

out fibre networks in the US.

We have a first-class board

and a very dedicated team.

The at the National Broad ban

Network Company this is not

administered by Conroy, Rudd

or anybody else. This is a

professional company with a

professional board and the

world class CEO. Isn't this

a good trick taking this

money off the books. You have

the pay interest? These from

standard normal accounting practices of public sector

finance. This is how the sale

of Telstra was treated. John

Howard was not able to sell

the proceeds from the sale of

Telstra and put it into his

revenue. He was not able the

use to it cut taxes, he had

to put it into other assets

and that is exactly the

process we are engaged in

here, we are are investing in

asn asset. This report shows

this is financially viable,

we get all the money back,

all the interest cost back

and make a modest return.

This is a financially viable

company which will deliver

faster broadband for around

the same places and then when

competition kicks in you will

see the real benefits of the National Broadband Network