NBN often 'indistinguishable' from existing broadband for many: Turnbull

Minister cautions against inflated expectations

As increasing numbers of Australians connect to the Internet using the National Broadband Network, they may well "wonder what all the fuss was about — and why the NBN is costing so much and taking so long," Communications Minister Malcolm Turnbull said today.

For "the 50 or 60 per cent or so of Australians with good broadband today, the NBN will often be indistinguishable from what they already have, assuming their current line speeds are sufficient to run the applications they need and value," the minister told the National Conference on Corporate Turnarounds and Transformation.

Turnbull said that although there had been a "dramatic" turnaround at NBN Co since the Coalition won the election and installed a new leadership at the government-owned company, the NBN rollout still faces significant risks.

"There are large execution risks related to the NBN’s schedule, scope, inputs, costs and sheer complexity," the minister said.

"These have repeatedly pushed the rollout off schedule and over budget. Make no mistake, execution risks remain significant, although the various changes to the NBN made under our government have materially reduced them."

The risks include "inflated political and public expectations."

"Fast broadband provides very large benefits for the economy and society, but it is a travesty that Labor deliberately conflated access to fast broadband with fibre, and was so irresponsible in exaggerating the impact of the NBN on people’s lives," the minister said.

"Sometimes I fear that every mayor in Australia thinks the project will turn their town into Silicon Valley. People with perfectly good broadband connections today — for example over HFC — have been brainwashed to believe that their world will be changed forever if they get fibre to the premises."

Another risk to the NBN project comes in the form of potential competition from improvements in wireless technology.

"Wireless may prove a formidable competitor, perhaps sooner than expected – which speaks to the value in avoiding laying too many costly FTTP [fibre to the premises] fibre lead-ins to users who don’t really need them," Turnbull said.

Other concerns include making NBN Co's billing and operational support systems work with the new multi-technology approach to the rollout, and question marks over the scalability of BSS/OSS and customer-facing functions such as service activation.

"Both need to ramp up to four or five times current volumes by 2015-2016, as customer acquisition accelerates," Turnbull said.

Turnbull said the Coalition had underestimated the "depth and breadth of the problems" it would discover within NBN Co after it won the election.

However, although some of the changes at NBN Co were occurring more slowly than the Coalition would like, "the turnaround we now see underway is dramatic indeed when compared to the company’s lowest ebb, which came a few months after the change of government," Turnbull said.

Follow Rohan on Twitter: @rohan_p

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