By Phillip Coorey Chief Political Correspondent
Consumers would pay about the same for the Government's proposed new super-fast broadband service as they do now for a much inferior product, the Communications Minister, Stephen Conroy, said.
Opposition claims that people would have to pay up to $200 a month for broadband if the proposed service were to be viable were based on the flawed assumption that the Government-owned company would be the retailer, Senator Conroy said
"We will be a wholesale company, not a retailer. We will not sell direct to the retailer," he told the Herald. "The national broadband network will be a general access wholesale network."
Internet providers would sell the service to homes and businesses and "for the same price you pay now, you'll get faster packages", Senator Conroy said.
The Opposition Leader, Malcolm Turnbull, insisted yesterday that the project - forecast to cost up to $43 billion over eight years - would not make money unless subscribers paid up to $150 or $200 a month.
He said this estimate was based on an assumption that about 4.5 million people, or half the market at present, signed up for the fibre-to-home service.
"The only way it can happen is with a massive Government subsidy, tens and tens of billions of dollars," he said.
Senator Conroy said estimates should not be based on current usage patterns because the network would change everything.
Optus backed his view, saying it would lead to a range of new services, a sharp spike in internet use and greater competition because it would neutralise the dominance of Telstra.
A spokesman for Optus, Maha Krishnapillai, said internet subscriptions and services offered had increased sharply in other countries after the introduction of very fast broadband.
"It's not so much looking at today, it's what's going to happen in the future," he said.
Optus, AAPT and Nextgen have expressed their interest in selling assets into the new network in return for a stake in the majority Government-owned company that will build and operate it.
The Herald has learnt that a group of Telstra executives - which does not include the outgoing chief executive, Sol Trujillo - will go to Canberra this week to talk to the Government about its involvement. Telstra has made no decision on whether to sell its assets in return for a stake.
The larger the private stakeholding, the less taxpayers would have to contribute towards the maximum Government input of $21 billion.