How the Coalition wrecked the NBN

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Via the ABC:

In 2009, the then Labor government promised a fast National Broadband Network (NBN) with optical fibre cables direct to most homes and businesses.

Instead, we’ve ended up with a mix of technologies including optical fibre, copper wires, Hybrid Fibre Coaxial (HFC), fixed wireless and satellite.

Every year the amount of internet data Australians consume increases by between 20 and 30 per cent.

Last year, the average home had 17 devices connected to the internet and that number is expected to more than double in the next three years.

When the NBN is completed next year, it is estimated fewer than one in four of fibre-to-the-node (FTTN) connections will be capable of achieving the top speeds currently offered over the NBN.

So how will the NBN handle our ever-increasing digital appetite?

Who is getting what?

“The one thing we’ve seen over decades is the demand for speed has increased, the demand on downloads has increased,” Mr Quigley told 7.30.

“Even 4K video hasn’t penetrated to a large extent yet. The bandwidth you need for 4K is obviously much greater than in high-definition video.

“All those things put demands on the broadband network and they will continue to put demands on the broadband network.”

FTTN is the way the greatest proportion of Australians — about 36 per cent — will be connected to the NBN.

HFC is the second-most-common technology, connecting 22 per cent.

The originally promised fibre to the premises (FTTP) will be used by 17 per cent and fibre to the curb (FTTC) will connect 12 per cent.

Fixed wireless connects about 5 per cent and satellite 3 per cent.

‘I should have a perfect connection.’ The FTTN experienceWhen he semi-retired to the NSW Central Coast he was told that wouldn’t be a problem.

“We couldn’t look anywhere that there wasn’t a decent NBN and connection because I want to work remotely,” he told 7.30.

“We chose this place because the node was right outside our door.

Mr Shaw’s provider promised him 100 megabits per second download speeds and 40 megabits per second to upload using a FTTN connection, which is just 25 metres from his home.

“That’s really close,” he said.

“I should have a perfect connection.”

And for a while he did. But now he gets drop-outs every day.

“Anywhere between 3 and 18 times — in the last 24 hours it’s happened 22 times for a total of 47 minutes,” Mr Shaw said.

“I’m losing hours of work.

“Upload speed’s important for remote workers.

“And when that goes down or when it’s slow, you just can’t work.”

‘Not one day of outage.’ The FTTP experience

He chose the northern suburb of Chermside because its homes were among the 17 per cent of residences to win the NBN lottery and have fibre to the premises.

“I wanted to continue my business from home,” he told 7.30.

“So I literally looked at the NBN and roll-out map to see where the NBN was, and there was just one area at the time, Chermside.

“And that was it. On the day that we moved in was the day I had the NBN connected.”

The video producer converted his garage into a studio and now can push huge video files around the world with ease.

“Since day one in 2013, when we had it installed, we have not had a problem,” Mr Schweikert said.

“There hasn’t been a day that we’ve had an outage, slow speed or anything like that.”

He pays for the top-shelf package and says he definitely gets what he pays for.

“It’s been fantastic. I couldn’t have wished for better.”

No drastic changes planned by major parties

“NBN is fit for purpose,” he told 7.30.

“But there’s no technology network that’s set in stone, you always need upgrade paths and the NBN is looking at those.

“It’s designed to meet the needs that people have.

“It’s doing that and it’s something that will be continually upgraded to make sure that it keeps pace with needs as they evolve.”

Senator Fifield said that under the Coalition’s plan, everyone will have access to fast broadband by 2020.

“The real digital divide is between those who have the NBN and those who don’t have the NBN, which is why we wanted to complete the NBN as soon as we could,” he said.

“Ninety per cent of people on the fixed-line network, the fixed-line footprint, will be able to get speeds of 50 megabits per second or more — 75 per cent of people will be able to get speeds of 100 megabits per second.

“You only need five megabits per second to watch high definition on Netflix.”

Despite its original vision, Labor is not promising a quick fix if elected next month but is instead offering to help consumers fix home wiring issues which can affect the NBN’s performance.

“Labor is taking a very responsible approach,” Labor’s communications spokeswoman, Michelle Rowland, told 7.30.

“We made it very clear that there is no quick fix to six years of vandalism by this government. And we will be informed, as we always said, by the realities on the ground.

“We need to examine in the immediate term what we can do in terms of having, for example, a pathway to get more fibre, but in the longer term also recognising that we need to get more Australians valuing broadband and online and currently that is not happening under the second-rate NBN.”

Could we have had a faster NBN for less?

Mike Quigley said if Labor’s original fibre-to-the-premises plan had been continued it would be almost complete and would have cost less than the current network.

“We would have the $45 billion costs instead of the $51 billion that we’ve got today for the MTM (multi-technology mix),” he said.

“It would have taken a little longer, I don’t dispute that, it certainly wouldn’t have taken six to eight years longer.”

That assertion is disputed by the Senator Fifield.

“What we have done under this government is what the rest of the world does,” he said.

“And that is use a range of technologies to see fast broadband rolled out fastest and at lowest cost.

“That’s the approach in Europe. That’s the approach in the United States. They use a range of technologies.

“By taking this approach, the NBN will be completed by 2020, which is six to eight years sooner than otherwise would have been the case. And $30 billion less cost.”

But Mr Quigley maintains the Government has inflated the cost of completing the network using FTTP.

“That is completely wrong. Those numbers are based on not a continuation of the FTTP program, but a restart,” he said.

“It uses completely erroneous costs for the FTTP.

“In the rest of the world, cost for fibre to the premises have come down dramatically.”

Senator Fifield disagrees.

“You only get the full national benefit of fast broadband when everyone has it. Under us, they’ll have it sooner,” he said.

Who could have known that changing technologies, roll out plans, staff, timetables and budgets mid business project would result in a dog’s breakfast? Not the Coalition nor its shining business success story, Malcolm Turnbull, it seems.

The very sad thing is that precisely the same hyper-partisan butchery is now wrecking east coast infrastructure and the energy grid.

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All of Australia’s key structural economic inputs mismanaged into oblivion at once.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.