Election puts telecom in limbo
Uncertainty surrounding the election outcome is providing no clear future for the national broadband network or Telstra (ASX: TLS).
The Coalition has pledged to discard the $43 billion NBN in favour of incentives to attract businesses to expand wireless broadband into regional areas.
On the other hand, a Labor victory would mean the network would go ahead and the telco giant would be guaranteed a major role at the cost of dismantling its vertically integrated business.
Whatever the outcome, Telstra's share price remains vulnerable, with the company facing big changes either way.
But a Labor's NBN provided a better outcome for Telstra and could increase earnings per share by 9 per cent by 2013, according to UBS.
Analysts said the network is probably the best-case scenario now because, assuming the deal goes ahead, it gives Telstra long-term certainty and cashflow. The company will lose market share but it is doing that without the NBN anyway.
''We watch with interest with the rest of the nation but it's business as usual for Telstra and we will continue to work constructively with all political stakeholders,'' said a Telstra spokeswoman.
NBN Co, meanwhile, must decide whether it keeps working until a new government emerges.
''We will do the things we need to do, and look forward to seeing an outcome,'' NBN chief executive Mike Quigley said.