The Federal Government has successfully closed an $11 billion contract with Telstra on its new high-speed broadband network.

Under the new conditions of the deal, Telstra will permanently halt its copper network operations and shifts its customers to the broadband service. In return, NBN will agree to remit Telstra's $9 billion for several years for Telstra's facilities, ducts and exchanges, and move Telstra's customers to the new network.

Although the deal is not yet finalized, however, it showed that Telstra is ready to cooperate with the government-owned NBN Co and will be its biggest customer instead of becoming its rival.

Prime Minister Kevin Rudd stressed that the contract provides more benefits for the Australian economy and it will provide affordable and better broadband services to the customers.

Chatherin Livingstone, the chairwoman of Telstra, said the contract was a positive move but still admits there is a lot more work to do to achieve a definite agreement.

The contract was supposed to close on Friday, but there was a slight delay when NBN Co requested for a better deal.

Mr. Rudd said the contract will assure Telstra's future and its 1.4 million shareholders.

Communication Minister Stephen Conroy said the agreement signaled the end of a war between the government and Telstra.

Meanwhile, the Opposition said it will block the deal and abolish the NBN if it wins the federal election this year.