NBN dominoes starting to fall: Aussies freeze rollout, Kiwis wary

Americans interested in whether or not a national broadband network (NBN) plan can slog through the political quicksand should look to the other side of the world. Recent indecisive election results have led NBN Co., the government group spearheading a $43 billion Australian fiber optic broadband network, to put an indefinite freeze on awarding any new significant contracts or, frankly, doing anything else that would move the project forward.

Australian voters split their opinions between two groups with vastly different perspectives on NBN, leading to the possibility of a hung parliament. This, in turn, led NBN Co. to say it would "continue to operate, plan and use existing resources but will seek to minimize any discretionary expenditures."

The Australian turmoil has caught the attention of neighboring New Zealand, where the government is hoping to spend $1.35 billion on an ultrafast fiber optic initiative. That project, though, is somewhat dependent on applications that might result from a successful rollout in Australia. Of course New Zealand's Communications Minister Steven Joyce has called such speculation rubbish and promised that things will proceed as planned.

Finally, Telstra (ASX: TLS.AX), which had expected to be a big part of the Australian NBN after signing an $11 billion non-binding agreement with the government, is in something of a flux position as things sort out. "We make decisions based on what we've got in front of us. If that changes, it changes and if it doesn't, it doesn't," said David Thodey, Telstra's chief executive. "They make their decisions; we'll make an appropriate response as a commercial organization."

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