Fibre-to-the-node (FTTN) and The NBN
On 26 November 2008, Telstra submitted a non-complying tender issued by the federal government to build a National Broadband Network. Instead of following the tender guidelines, Telstra submitted a 12 page letter proposing a $5 billion broadband network covering between 80 and 90 per cent of the Australian population, in particular, only major cities, despite the tender requiring 98 per cent coverage.
Telstra was removed from the National Broadband Network RFP process on 15 December 2008. According to a spokesman for the Communications Minister, Stephen Conroy, "The expert panel has determined that Telstra’s submission to the national broadband network is not compliant. They are out of the process now."
Telstra has announced that it will raise speeds on its existing Next G network and HFC "cable" network so that they both offer higher speeds than the RFP for the NBN requires.
Following Telstra's exclusion from the National Broadband Network bidding process Telstra's share price suffered the biggest one day percentage fall in its history.
On 19 June 2010, Telstra came to a non-binding agreement with the Australian government to participate in the National Broadband Network. In exchange for A$11 billion, Telstra is required to de-commission its copper and HFC broadband networks and transfer all customers to the NBN once it is completed.
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