Australia’s Second Grade NBN

NBN seems synonymous with the word ‘Inquiry’.  On February 18 the Australian parliament’s Joint Standing Committee on the National Broadband Network opened inquiries into the NBN Co’s business case and the rollout of the network in rural and regional areas.

The inquiry into financials will examine the long-term financial outlook for NBN Co, including forecasts related to, revenue generation; other matters relevant to the commercial viability of NBN, the Commonwealth’s accounting treatment of government debt/investment in NBN, and the prospect of future sale, in whole or part, of NBN.

They will also be looking into the competitive risks facing the multi-technology mix

Multi-Technology Mix – where do I start ? How about 24 November 2007 when the Australian Labor Party won the Federal Election. The creation of a National Broadband Network was a major policy platform with a commitment to provide 12mbps to 98% of homes and premises. Government committed to provide $4.7b in funding.

Let fast forward to 7 September 2013 the Liberal/National Party Coalition won the Federal Election making NBN Co and the NBN subject to revised policy directives and outcomes. The new Minister for Broadband and Communications, Mr Malcolm Turnbull, initiated a ‘Strategic Review’ of NBN Co’s operations with the result released in December of 2013 recommending radical changes to NBN Co’s operations and roll out.

Following the Government’s expressed intention of changing the structure and roll out of the NBN, in April 2014 a new Statement of Expectations was issued which would see the NBN comprise:

  • 26 per cent fibre to the home,
  • 44 per cent of fibre to the node (street-side boxes up to 1km from the user, relying on the old copper wire for the last link) and,
  • 30 per cent using existing hybrid fibre cable used for Foxtel.

This revised construct was given the name MTM (Multi Technology Mix).

Malcolm Turnbull christened his second grade NBN as the Multi-Technology Mix or MTM. Or is it Malcolm Turnbull’s Mess.

My opinion on Australia’s NBN – not much, and Australia’s NBN sucks like Michael, my vacuum cleaner. It’s a wasted investment for not predominately focusing on wireless rather a fibre network.

NBN Co’s justification as to why they were/are rolling out FTTN rather than FTTP, is, according to NBN Co, FTTP is too expensive for Australia, claiming that Australia is not on a level playing field with other countries that have FTTP – seriously ? So Mr Turnbull decided to buy the useless Copper from Telstra and Optus at an exorbitant price only to find that the copper was badly maintained and is useless and will cost billions to upgrade because “DUH” Copper is more expensive than fibre. Now the Fibre goes to the node and the copper runs from the node to the premise.

Although the real reason for the blow-out was as per the leaked internal documents from NBNCo which revealed; “remediation costs to Telstra’s copper network have blown out by 900%”.

The strategy changed with the change in the Government from the conception of NBN to its rollout. Secondly, their justification for not rolling our FTTP is because of the rollout cost. NBN Co has been crying for many years that the cost of FTTP will be $4000 (appox) per premise. This justification is misleading, since the past 3 years, the roll out practices for other benchmark countries have reduced the FTTP costs up to 40%

The Coalition has consistently asserted that FTTN can provide sufficient speeds to meet Australia’s needs well into the 21st century .

I quote then Prime Minister Mr Abbot who made clear the Coalitions view on how much broadband is ‘enough’ “we are absolutely confident that 25 megs is going to be enough, more than enough, for the average household” – tf? (pardon the french)

But in 2013 many incumbent Telcos were still promoting FTTN as a viable broadband solution. AT&T was amongst those Telcos that were rolling out FTTN in 2013, and much was made of this in the lead up to the 2013 Federal Election to justify the position that FTTN was good enough for Australia.

Since 2013 an increasing number of Telcos around the world have accelerated their move away from FTTN and towards FTTP. And they have done this because they recognise that FTTP is the most cost effective long-term solution to providing the broadband infrastructure that will help power competitive economies through the 21st century. In April 2015 AT&T, the largest Telco in the US, announced it was expanding its FTTP rollout.

Verizon In May 2015 Verizon, the second largest Telco in the US, announced it was expanding its FTTP rollout to all of its 2,000 exchanges. “The copper network today does not serve the need of our customers. This is our way of truly transforming our network”.

Telcos around the world are recognising that FTTP is the most cost effective way to provide the broadband infrastructure that is needed to stay competitive into the future.

The NBN is not – and never was – about providing enough bandwidth for people to stream Netflix at home.

It is about providing the vital infrastructure that Australia needs to stay competitive in the 21st century. And that should have meant a ubiquitous FTTP network, not a mishmash of technologies using old cable, with higher operating costs.

Mike Quigley (Australian telecommunication business executive and the first Chief Executive Officer of NBN Co) said:

“As long as Australia’s broadband future is tied to an aging copper network, we will fall further and further behind our competitors and trading partners. At a cost of $56 billion and counting, that will be Mr Turnbull’s legacy” 



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