McKinsey lands USO Co consultancy deal

Wins more NBN-related work.

Global consultancy McKinsey & Co will be paid almost $5 million to assess the new entity being created to oversee the universal service obligation (USO) in a national broadband network world.

It was another coup for the consultancy which had previously put together the $25 million NBN implementation study with the help of KPMG.

This latest contract, which was outlined briefly on AusTender, was first reported by The Australian.

According to the contract notification, McKinsey was retained for "independent research and assessment" of the USO Co project.

The contract - and any outputs - were deemed confidential because they allegedly contained "internal costing/profit information".

The Australian newspaper reported Friday that the Department of Broadband, Communications and the Digital Economy "wanted McKinsey to look at the scoping, costing and funding of USO Co", according to data disclosed under freedom of information laws.

The Government announced its intention to create USO Co after the announcement of the draft heads of agreement between NBN Co and Telstra.

The deal, which would see Telstra progressively retire its copper network and move customers onto the NBN, would also absolve Telstra of its universal service obligation responsibilities. At present Telstra is required it to provide every household "reasonable access to a standard telephone service".

The DBCDE has an industry consultation in progress around the "implementation of Universal Service Policy for the transition to the NBN environment".

Submissions closed at the end of last week and were yet to be published by the Department.

Greenfield fibre builders were hoping to get a slice of USO funds as a kind of co-funding arrangement to deploy fibre optic cables in new housing estates.

The proposal was first flagged by iTnews earlier this year but had re-gained some momentum recently with at least one operator known to be making submissions to the Government inquiry.