What is the future for the NBN under the Coalition?

As the Coalition reportedly prepares to release details of its alternative National Broadband Network plan, what is at stake for the network if Labor loses the election?

NBN Co has a 10-year plan for Australia’s high-speed broadband future, but a change in government after September’s federal election – with the latest Newspoll showing the Coalition with a lead of 52 per cent to Labor’s 48 per cent on a two-party preferred basis – has created uncertainty about the project’s future.

Shadow broadband minister Malcolm Turnbull has made it clear he plans to do things differently with the National Broadband Network (NBN), which is Australia’s largest ever public infrastructure project.

NBN Co has also thrown the doors open to a potential change in the roll out of the network, with NBN Co CEO Mike Quigley recently calling for a study from the Communications Alliance to decide what is the best technology to use to roll it out.

However, little is know about the Coalition's NBN policy other than it would employ fibre-to-the-node (FTTN) for large parts of the network, rolling out fibre to cabinets in the street and using copper for ‘last mile’ connection from the cabinet to premises.

The shadow minister has said that fibre-to-the-home (FTTH) would still be rolled out to new housing estates (greenfields developments).

This compares to the Federal Government's roll out of the NBN utilising FTTH, which delivers fibre to the doorstop of premises, for 93 per cent of Australia.

Turnbull has also said he would retain Telstra and Optus’ HFC networks, which are based on a combination of copper and optical fibre, in order to remove “barriers to competition” with the NBN.

If the Coalition wins the election it won’t be the first time an incoming government has been tasked with completing an already in-progress infrastructure project, and Nick Economou, senior lecturer in politics and social inquiry at Monash University, said there may be limits to how much a new government could change the direction of the NBN.

One example is the construction of a desalination plant in Victoria, which was announced by John Brumby’s Labor government in late 2007 and includes a 30-year contract with the AquaSure consortium.

The Liberal Party's Ted Baillieu became premier in Victoria at the end of 2010 and said the Liberal government was stuck “with a very expensive white elephant” because it would have cost too much to extricate itself from the project’s contracts.

“The opposition went bananas over [the desalination plant] and pilloried it every waking moment of their existence. But upon coming to government, when confronted with the cost of extracting itself from all those contracts, it said ‘no, no, we’re more or less tied in’,” Economou said.

He expects the same will happen with the NBN if the Coalition wins the election.

“I wouldn’t be at all surprised if there were only minor alterations to the direction of NBN policy after the election [under the Coalition],” he said.

However, independent MP Rob Oakeshott has said it is still possible for the NBN plan to be changed, but “the worst thing that could happen now is a complete change of direction”.

NBN Co’s future under the Coalition

Economou said it is possible that Turnbull might try to dismantle NBN Co and create a new organisation in its place.

The shadow minister has been a staunch critic of the NBN wholesaler, blaming the company for not having a “transparent approach to information” and making it difficult for the Coalition to carry out a costed analysis of its alternative NBN plan.

“It’s a statutory authority,” Economou said. “Now of course statutory authorities have a certain degree of autonomy from ministers, so what presumably the Coalition government will do is they will go back to the enabling legislation, redraft it, alter its charter of operation and I dare say it will then move to get rid of whoever’s running it at the moment.”

In order to replace NBN Co, a Coalition government would need to pass new legislation.

“If the Coalition did not control the Senate, this could prove to be tricky,” Economou said.

What will a Coalition NBN look like?

In 2010 the Coalition said it would demolish the NBN. Since then, the Coalition has changed its tack, indicating it won’t demolish the network but roll it out faster and cheaper.

Turnbull recently stated the Coalition would honour existing NBN contracts, which include the $11 billion Telstra contract and the $800 million Optus agreement and suggested it might introduce a plan where users could pay to have fibre extended to their premises.

However, rolling out FTTN instead of FTTH would require altering existing contracts, something which Telstra’s CEO, David Thodey, told the Australian is out of the question if the contract’s dollar figure is changed.

While speeds up to 100Mbps are achievable on the FTTH NBN, Turnbull has said most people would be able to achieve speeds of 50Mbps on a FTTN-based network, while those farthest away from the node will experience speeds of 25Mbps and a third of people will achieve speeds of 80Mbps.

This assumption is based on the experience in the UK, Turnbull has said, and he has refused to confirm what speeds Australian consumers would be able to access under the Coalition’s NBN.

Turnbull also has refused to provide figures on how much sooner or cheaper the Coalition would be able to roll out the NBN, telling ABC Radio’s AM program it is unable to produce a costed analysis of its NBN plan as it is unaware of the “extent to which [NBN Co] have made commitments”.

Regardless of what road the Coalition takes, Economou said it will have several challenges ahead.

“On one hand there will be the principles that they set out when in opposition about the need to find a more cost-effective way of doing things,” he said.

“On the other hand I think they’ll be under enormous pressure from rural constituents, who are usually quite strong supporters of the Coalition, to go ahead with the aspects of the broadband rollout.”

Tags Malcolm TurnbullaccanMichael FraserCoalitionNick Economou

More about ABCABCAppleCommunications Law CentreFederal GovernmentMonash UniversityMonash UniversityOptusQuigleyTelstraUTS

11 Comments

danny739

1

I think it's blindingly obvious that the Coalition will say what they need to in order to get into office. But they will be looking or $$ once in and with out the MRT or the carbon tax, they have little else to do besides sell things. They will cut what they always cut, health, education, infrastructure, as they believe this should all be privately funded.

But i believe they will sell the NBN off within 2 years of getting in and make some lame excuse analogy like "you shouldn't be buying a new tv if you cant afford to eat".

News ltd & Fairfax will dutifully repeat the dogma, especially Murdoch who wants it dead.

Joolia

2

I hope that it will be too late for the Colatition to change to FTTN, but unlike the desaliation plant in Victoria or Myki, the NBN has progressed so slow that it is nowhere near point of no return.

If Turnbull wants to roll out the NBN faster and cheaper, he could do this and still use FTTH. By using foreign labour at 1/10th the cost of Australian labour. Bring in as many foreign workers, pay them peanuts (which is much more than in their home countries), then send them back when the job is done. Could also put those illegal boat arrivals to good use, assuming they have aptitude to be trained. The ALP couldn't do this because unions who control the party would object to foreign workers. But as we've seen in the Wonthaggi desalination plant, local workers deliberately slowed down the project to ensure their $200k p.a. jobs could go on as long as possible.

Bill

3

I am in Bentley Park a suburb of Cairns which can hardly be called a remote area. Currently I have ADSL 2+ from my ISP who is Telstra which on a good day clocks at 6.5 Mps with a down load speed measured at 1.2 Mps. This is a far cry from the 2+ expectation, Telstra technical have stated that it the best they can do, I cannot get a non Telstra based ISP. I think most Australians outside of the Metro areas would be quite happy if they could just get the service they are currently signed up and paying for. If FTTN can achieve that faster than FTTH excellent, 25 Mbps will probably do everything I & 85% of Australians will ever need. Those who require higher speeds would mostly be a business and therefore should be able to cost justify the fibre connection as part of their network overheads.
One of the current issues is the lack of infrastructure ie. exchanges or nodes in regional and/or older suburbs, including the age and capacity of existing ones and the lack of capacity on trunk routes; copper to the home is only a minor part of the issue and much more easily addressed on an "as required" basis, you can put over 100 Mps over the air if necessary. Let's get the major issues fixed first.

Adam

4

"It is a ‘build it and they will come’ sort of approach"

Actually, it's a build it, roll everyone on to the new network and then shutdown the old network.

gnome

5

Actually, it's a case of:
'By the time it is finished in ten years time, demand will have increased so much that endusers will be scrambling to get it.'

danny739

6

Yes Joolia and if there was no quality control or safety control over workers, the Coalition would be the first ones to point the finger and say, "look, another pink batts!".

Mike Hunt

7

Who cares about e-health, likes it's some sort of killer-app for the NBN. With FTTN or Telsta HFC, it is going to be hard to stream 4K porn to every room of the house unless we have gigabit speeds, especially when you have multiple torrents going at the same time. Has Malcolm Turnbull considered this?

karl_w_w

8

Okay time to filter out some of the bullshit in the comments.

Joolia:
Are you trolling or do you really believe the lies told to you that the NBN is rolling out slowly? They spent 2 years in testing and contract negotiation, which is the nature of the beast with such a large project. They spent 6 months ramping up the rollout, and now they are passing about 6000 premises every day. Does that sound slow to you? Of course Turnbull agrees, in early 2012 he said if they meet their target to have construction commenced or completed to 758k premises by year's end it would be "extraordinary" and "there will be a lot of admiration in terms of construction", and of course they exceeded that target. Of course then Turnbull decided he didn't like the measurement itself, because there is no way he could possible admire the NBN, that would be contrary to Liberal and News Limited interests.
http://www.zdnet.com/au/nbn-co-exceeds-2012-target-7000009683/

Bill:
"25 Mbps will probably do everything I & 85% of Australians will ever need"
That is an extremely myopic view of things. You only have to look at history to see how many "we only ever need X amount of Y" predictions have fallen flat on their faces, and history will also show you how fast internet speed requirements have grown. But if you want actual forecasts of continued growth based on hard evidence from an impartial third party that knows what they're talking about, how about Cisco? http://www.arnnet.com.au/article/426091/cisco_australia_broadband_speeds_ahead_global_average_by_2016/

"copper to the home is only a minor part of the issue and much more easily addressed on an "as required" basis"
Completely untrue. The copper network would need to be tested and replaced in several places adding in a major cost and time investment which Turnbull doesn't factor in to his vague "plans". Why spend time and money employing a bunch of guys to fix up the old copper network when it's going to need replacing anyway, and it's still going to cost $700m per year more to maintain than fibre?
http://www.abc.net.au/technology/articles/2012/11/23/3639761.htm
http://www.zdnet.com/au/nbn-to-save-up-to-au700m-in-copper-maintenance-costs-7000002846/

karl_w_w

9

Clarification to my last comment: the copper would need to be tested everywhere to ensure it's viability for FttN, and then replaced in many places. The whole copper network will need be replaced in the not-too-distant future because FttN is the fastest it can go, and even that speed is barely enough to meet the demand that's expected in 2016 (according to Cisco).
FttN was only ever meant as a stop-gap to get the last out of the copper network, and it's only a viable option if the copper is of good enough quality and if FttN deployment is carried out by the owners of the copper. Neither of those conditions are true in Australia. Rolling out fresh copper and/or buying or leasing a copper network off of somebody else is nothing short of lunacy and a waste of government time and resources.

Al

10

To Bill, you are getting what you pay for. ADSL 2+ does not guarantee 24 mbps, that is at the exchange. The minimum speed guarantee for Telstra is 1.5 mbps, so be happy with 6.5 mbps. However your thirst for more speed is what NBN is all about.
Source- i am a telstra tech

Homabarume

11

Was it not Henry Ford who said “If I had asked people what they wanted, they would have said faster horses.”?
In the US companies are suing municipalities to stop them rolling out FTTH because they themselves are unwilling to put in the investment. Having it as a governmental initiative is the the best way to ensure it is done right.Unless they just contract the whole thing out to Google. I want that Gigabit goodness. The Coalition is not getting my vote until they state clearly their intentions with the NBN.

Comments are now closed

Telstra unveils locations getting early access to 700MHz 4G network

READ THIS ARTICLE
MORE IN Business
DO NOT SHOW THIS BOX AGAIN [ x ]