The national broadband network could see internet costs skyrocket under the proposed fibre to the node network, the head of a national internet service provider says.
The Government has received six bids to build the network, planned to deliver high-speed internet to 98 per cent of Australian homes and businesses.
Telstra, which analysts expect will win the bid even though the company's bid was not fully detailed, has proposed a fibre to the node upgrade to its existing network. Telstra says its network will provide millions of customers with broadband four times faster than today's entry level 1 megabit per second at no extra cost.
But Internode managing director Simon Hackett said consumer costs would inevitably rise under the proposed network.
Internode is part of the Terria consortium, including Optus and previously TransACT, which has bid to build the network in the ACT.
Mr Hackett will speak today at an international telecommunication conference in Adelaide, the major national meeting of researchers in information and communication technology.
''Consumer pricing is guaranteed to rise due to the removal of competitive tension from ADSL2+ providers,'' Mr Hackett said.
''[It] will also rise due to the need to recover the massive investment in building fibre to the node. Those costs can only be recovered from consumer price rises, and/or from paying the same price but receiving a worse outcome.''
Mr Hackett said Telstra's proposed broadband plan under its new network was slower and had less download quota than competitors' plans for the same price today.
''So while it might be an improvement for a BigPond customer, it's a huge step backwards for the country in general,'' he said.
A Telstra spokesman said Australia deserved a world-class national broadband network, not a ''second-rate network that would see taxpayers lumbered with white elephant infrastructure costing billions of dollars''.
''We have the technical capacity, expertise and skilled workforce to do the job but most importantly we have a proposal on the table backed by $5 billion of our money,'' he said.
''At this stage not one of our opponents has locked in funding. To be classified as a serious bid, funding is essential. Australia can't afford to settle for second best with the national broadband network. We must get it right, and get it right the first time.''
Telstra said its bid to build the network was not fully detailed because several issues were yet to be addressed, including further separation of the company.
Competitors have criticised the 12-page ''non-compliant'' proposal and questioned its legality.
But the Government has said it will consider Telstra's 12-page network proposal in the same way as the other five proposals, even though it did not meet the guidelines.
Research director Robin Simpson, of information technology analyst Gartner Australasia, said Telstra had to address concerns about market dominance and pricing if it was to build the network.
''Telstra has played a very aggressive and risky game in trying to get a regulatory environment that favours them,'' he said.
''Clearly they are in a better position to actually build this thing than anybody else, because they control all of the copper.
''[But] if they were to win it without any curb on what would effectively rebuild their monopoly, then everybody would be pretty worried.''
A Government-appointed expert panel has less than seven weeks to consider the proposals.
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