Internet service providers said the move, announced by the telco Tuesday at the Sydney CommsDay conference, will "liberate the telecommunications industry" from exorbitant wholesale access prices and bring access agreements in line with those in the UK and much of Europe.

The move follows comments by outgoing Telstra CEO Sol Trujillo that the telco stands to lose some $2 billion in lost revenue for its exclusion from the NBN tender after it , and confirms the telco has been considered by the government selection committee.

It has also triggered speculation that its inclusion in the bidding process could be behind the government's refusal to release NBN regulation documents requested by Tech Wired under a freedom of information request.

Internode managing director John Lindsay said an operational-separated Telstra NBN will ensure the taxpayer-funded network provides competitive access and availability for consumers.

"Internode welcomes the exciting new era in Australia's telecommunications industry," Lindsay said.