Buying Telstra copper too expensive, says NBN Co

NBN Co chief executive Mike Quigley has underlined the complexity and cost of changing the company's $11 billion deal with Telstra's to access the telco's copper wire network.

After last month signing the infrastructure-sharing deal, Mr Quigley yesterday said NBN had not negotiated to use Telstra's copper cabling because this would have raised the deal's cost and added further delays.

The comments highlight the difficulty a future government would face if it wanted to untangle the deal with Telstra in favour of a cheaper option. The Coalition, for instance, has signalled support for a fibre-to-the-node network, which would depend on using Telstra's copper.

''The deal was an extremely complex deal with Telstra,'' Mr Quigley said in Canberra. ''To have negotiated, in parallel, another deal to allow us to use the copper would have been an added layer of complexity, which I am sure would have taken many, many months to reach a conclusion on, if it was possible to reach a conclusion on at all.''

Mr Quigley, who was appearing before a joint parliamentary committee, did not speculate on how much it would have cost NBN Co to acquire Telstra's copper cabling.

However, he confirmed it would have been an extra cost: ''The deal that we did do involved, in terms of infrastructure, ducts, pits, exchange space and dark fibre, it does not include copper. We did not negotiate a deal on the copper itself.''

Once the network had reached more than 20 per cent of targeted homes, Telstra would also be owed a $500 million break fee by any future government that wanted to scrap the deal.

Mr Quigley told the committee a fibre-to-the-node model would use twice as much energy per property compared to the current plan.

With polls suggesting the Coalition would win government in a landslide if an election were held today, the future of the network under an alternative government has also become a genuine concern for investors. A report from Commonwealth Bank analysts said cancellation of the NBN would be positive for internet service provider TPG because the company's margins are likely to be diluted by the network.