Shadow communications minister, Malcolm Turnbull, has claimed a 12 megabits per second (Mbps) connection to the home is enough for anybody, with no applications existing today that require additional bandwidth.
“For most, if not all applications, much lower speeds are perfectly [fine],” he said. “If you could deliver nationwide 12Mbps at relatively modest cost compared to the NBN, what is the additional utility/value of going from 12 [Mpbs] to 100 [Mbps].
“People in the industry will tell you that they cannot get people to pay a significant premium for an increase in speed. That is partly because, that for a residential user, there isn’t much, if anything, you can do with 100 [Mbps] that you can’t do with 12 [Mbps].”
Turnbull could not confirm how long a 12Mbps network would last before applications demanded higher bandwidth.
“The only thing which will drive higher speeds, for residential usage… is going to be bigger and bigger files, and that is going to be, can only be, higher and higher definition video," he said.
“You then have to ask yourself: Should the taxpayer should have to spend $43 billion when there are so many infrastructure demands where there is a screaming need now.
“Should we really be spending $43 billion to cater for needs for applications which aren’t available today, and we don’t know whether they will be available in the future; they might be available. Who knows?”
Turnbull claimed it would be a more viable approach to "tune up" current hybrid-fibre coaxial (HFC) networks to 100Mbps then determine if demand continued for the speeds. Optus and Telstra recently upgraded their respective HFC networks to the capability using DOCSIS 3.0 technology, which the Opposition has continued to use as a rationalisation for a cheaper alternative to the NBN.
Optus is currently in court with the competition watchdog over alleged misrepresentation of its cable plans and speeds.
Responding to Computerworld Australia, Turnbull dismissed suggestions that a cost-benefit analysis on the National Broadband Network (NBN) be delayed until the mainland NBN pilot sites are fully built and the cost of deploying the network fully known.
Turnbull argued that the costs of deploying fibre-to-the-home networks were already largely known.
“There is a higher degree of certainty about the costs. We know, or should know, with a high degree of certainty what it is actually going to cost to roll this out,” Turnbull said.
“Where the big question marks are what are the benefits, what are the revenues going to be, the take up rate going to be, what are the spill over economic benefits going to be.”
The mainland trial sites, announced in March would, according to NBN Co chief executive, Mike Quigley, validate network design, construction and installation techniques to test the requirements of the NBN across a range of different geographies and climates.
A spokesperson for the office of communications minister, Senator Stephen Conroy, did not comment on Turnbull's 12Mbps claims, but cited OECD and Australian Industry Group reports indicating potential productivity benefits as a result of high-speed broadband.
"Like so many key pieces of national building infrastructure that don’t require a cost benefit analysis – for example expanding a national highway - the potential benefits affect almost every aspect of the economy and of society," the spokesperson said.
"To do a formal cost-benefit analysis of the NBN would take many years, require many heroic assumptions, and would imperil Australia’s chances of receiving world-class broadband and NBN Co’s viable business case, just as it is beginning to deliver."