Government spends $43 billion to establish National Broadband Network
- 07 April, 2009 09:05
- Comments 10
The Federal Government will establish a new public company to build the next-generation National Broadband Network (NBN) across Australia.
In a press conference this morning, Prime Minister Kevin Rudd said it would spend $43 billion to create a new wholesale-only fibre optic network across Australia. The government-majority owned National Broadband Network Corporation will work in partnership with the private sector over the next 7-8 years to build the network across regional and capital cities.
The network will provide access of up to 100Mbps to end users and cover over 90 per cent of the nation.
Prime Minister Rudd said it then planned to sell-off its stake in the operations within five years of it being established. The decision represented a historic moment in Australia’s history, and was the largest infrastructure project ever laid out, he said.
“This injects a new player into the broadband market… a national, wholesale, open access broadband network,” he said. “It sets up a path for economic recovery and building a 21st century economy withy 21st century jobs.”
Rudd claimed the network would provide 25,000 jobs every year during the lifetime of the project, and up to 37,000 jobs during its peak. It will also add $37 billion to GDP, he said.
The decision follows month of negotiations with private consortiums under the NBN tender.
“We have tested the market but that has not produced an outcome which makes the best use of the taxpayers’ dollar,” Rudd said. “Right now we are dealing with a capital constrained world. We have acted on the advice of an expert panel... otherwise we wouldn’t be here.
“There were two options – sit back, or get on and do it. And we intend to [get on and] do that.”
The first step will see the Government outlay $250 million and build a fibre optic backbone in regional Australia, Senator Stephen Conroy said.
“The conditions are that it is open access and wholesale only,” he said. “We will have an implementation study over the next eight or nine months to work out the issues and challenges.”
The Government will also work with the Tasmanian Government on its proposal for high-speed services in that state and hoped to get things rolling by mid-year.
“We’re negotiating with the Tasmanian Government over the next 24 hours as to the rollout… we believe they are ready to go,” Conroy said.
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Comments
Anonymous
The government will not be spending $43 million - much of the spending will come from the private sector.
Anonymous
Wise decision.
Anonymous ex ICT mgr
You mean $43 Billion don't you - and we all know Governments always go over budget......
We needed another fibre backbone like a whole in the head. The Government isn't finished selling the one they owned.
It is interesting that Tasmania goes first - either they are politically well connected or just a pilot project?
Govt will have to poach/contract their staff from somewhere and that at least makes the job ads rise.
Tyalgum Jack
Expedient Move
While I'm not sure that this announcement is not the ultimate act of political expediency, there is no doubt that it addresses a number of crucial economic and regulatory issues.
At a time of much needed Government investment in Australian infrastructure it offers a great financial injection. It has thrown all currently interested telco. parties back onto a level playing field (Telstra included). It has also tackled the question of structural separation by putting majority ownership back in the hands of the Government, and it has even managed to incorporate a stand alone Tasmanian agenda.
The only down side appears to be that it will now be driven with, what can only be assumed, the typical speed and responsiveness of a Government controlled, bureaucratic, governance centric process.
gnome
Best decision for everybody
Well, nearly everybody. It won't be popular in one boardroom, but then they are not known for making good decisions in the public interest anyway.
The proposal to plan ahead and seed fund a national FTTP network is statesmanlike and very welcome.
Now if only Mr Rudd and Senator Conroy could achieve the same level of calm common sense about their ridiculous Internet filter plan. . .
Anonymous
WIMAX - just round the corner!
Spending $40Bill- Plus + Plus is crazy for cables which will eventually run out of bandwidth!
WiMax - Wireless technologies will only get faster and better - cheaper to deploy across a wide terrain and easily scalable!! Speeds up to 50Mbs already available, by the time the cables are buried in the grounds, they will exceed the 100Mbs and beyond!
It is be cheaper, quicker to deploy and scalable as required. Lot of equipment vendors will offer WiMax as a built in device so there will be nothing to configure,plug into or cables, just switch on ad use high speeds !! Technology is now been standardised.
Anonymous
Infrastructure
We need public transport systems and upgrades, better roads and freeways ; - freeways NOT TOLL ROADS!!
-Better Water management to avoid floods and drought cycles!
-More encouragement for local production using local raw materials etc
- incentives for local companies to expand into producing finished goods
- Local farmers need help and incentives to produce ?
- Oh - yeah - then maybe high speed internet access will be a good idea also - especially for the people of TASMANIA!!! ??
Anonymous
Over budget and Over time - more like $100 billion
The Victorian Myki was supposed to cost $300 million and be finished in 2005. Now it cost $1.3 billion and still not delivered (pilot in Geelong still facing difficult).
Western Australian Government Whole of Government Share Services initiative, to cost $91 million and be finished by December 2006. Now cost has already blown out to $435 million with "scheduled" completion 2013.
I can go on, every Government, Federal, State, Local have proven themselves to be "excellent" project managers.
If, and that is really a "if" the FTTP gets up, I think we will be looking at a build cost of $100 billion+ and probably fifteen years later.
I believe there will be few investors for the projects so we the taxpayers will have to foot the bills as usual.
The only winners being the politicians and their "friends" that build the network and gets hired for "fat cat" salaries.
2 headed
high speed inernet
Given the average tasmanian has twice the cerebal capacity of a mainlander I think its necerssary that we have access to high speed internet to meet our intellectual needs.
Aside from that; Highspeed internet across the country has the ability to increase Australia's production possibility curve, inturn increasing our GDP and the tax revenue the governement recieves, money which could then be re-injected into national infrastructer at a time where economical times are not so harsh
Anonymous
@high speed inernet
The Tasmanians might, just possibly, have twice the cerebral capacity, but that does not appear to include spell check capability. . .
But if we accept that Tassie is part of Australia (a concept that may be challenged from both sides of Bass Strait), then of course the Taswegians should have the same Internet access available to the rest of us.
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