The TPG Telecom Ltd (ASX: TPM) share price has jumped 5% today probably due to the news that government legislation will exempt NBN internet service providers from a charge designed to help to fund regional broadband.
According to the Fairfax press the legislation will exempt NBN service providers from the government's $7.10 per connection levy for the first 25,000 premises connected and could result in service providers saving $2.1 million per year for five years.
These kind of savings are not going to move the dial for large internet services providers like TPG or Telstra Corporation Ltd (ASX: TLS), but all savings count for businesses like TPG that have big upcoming capital expenditure commitments and dividend-hungry shareholders.
TPG shares have collapsed in half over the past year as investors shudder over the margin-crunching impact of the NBN, its debt profile, and its $1.9 billion in upcoming capital commitments required to build a mobile network.
Although TPG has some short-term hurdles to jump ahead of it the long-term may be looking better than ever and today's share price of $5.90 could be a bargain opportunity for investors willing to take on a moderate amount of risk.
