The Coalition’s NBN – a huge waste of money

NBN’s fibre optic cable will no longer connect to each home.

Fibre optic cable will no longer connect to each home under the Coalition’s NBN.

Despite his earlier fervent opposition and having voted very strongly against the National Broadband Network (NBN) under Labor, in recent times Federal Member for Bowman, Andrew Laming, has become something of an NBN evangelist, wildly spruiking the Coalition’s ‘Fast, Affordable, Sooner’ claims.

I count no less than ten articles in local press over the past year, something of a turnaround for someone who once described the NBN as ‘a great white elephant’. But just how do Laming’s and the Coalition’s recent claims stand up to scrutiny?

Sooner?

The Coalition went to the last election promising all Australians would have access to 25 megabits per second (Mbps) download speeds by 2016. Malcolm Turnbull’s ‘Multi-Technology Mix’, it was claimed, would deliver broadband to Australia ‘Fast, Affordable, Sooner’.

In December Laming claimed that 46% of Redlands would be able to use pay-TV (HFC) cable and Fibre to the Node (FTTN) to access high-speed broadband in 2015 with speeds of up to 200 Mbps but speaking at a Redland Chamber of Commerce meeting last week, NBNCo Manager of Government Relations, Justin Jarvis, said the now 2017 timeframe for the Redlands depended on a range of “unforeseen factors”.

One of these ‘unforseen factors’ may be that NBNCo simply does not have enough people. NBN Boss Bill Morrow recently told The Australian’s Beyond the Boardroom series that “If I look over the next two or three years, we have a shortage of about 4000 people and I don’t know where we’re going to get them to be able to do this at this point without launching a massive retraining program to move people from other industries to come in.”

The 2016 commitment it seems is long forgotten, 2017 looking somewhat shaky and Laming’s 2015 cable revolution dead, buried, cremated…

Fast?

Under Labor the initial Fibre to the Premises (FTTP )broadband plan, believed by many in technology circles to be the only ‘real’ NBN, would have connected 93% of Australia with optical fibre. The advantages of FTTP over the Coalition’s botched Multi-Technology Mix adventure are clear – FTTP connections would have initially delivered 1000/400 Mbps whereas the Coalition’s NBN will be lucky to reach their guaranteed 25/5, never mind Laming’s fanciful 200 Mbps claims.

Furthermore, based on existing and badly degrading copper, both HFC and FTTN networks are not only heavily affected by demand, usage of the network, distance from the exchange or nodes, but also environmental factors such as wind and rain. Despite their more recent claims, in 2003 Telstra’s then manager of regulatory strategy, Tony Warren, told a Senate enquiry, Telstra’s 100 year old copper network was at “five minutes to midnight”. With Telstra having happily handed off this problem to NBNCo for a tidy sum, the costs of maintaining the crumbling copper network have been estimated at up to $1Bn a year. Hardly good value.

Future speeds under Labor’s FTTP NBN would have been limited only by the technology developments at each end of the cable. With current technology, fibre networks can already reach Terabits per second. Once built, Labor’s FTTP NBN would have lasted generations. The Coalition’s NBN is unlikely to be able to keep up with demand and technology for a decade.

In May, Laming claimed that parts of Redland Bay and Mt Cotton would be connected to the NBN with speeds of 25-100 Mbps. This does not, however, stack up with the latest Draft Wholesale Broadband Agreement which clearly states that FTTN speeds will be limited to 12/1 Mbps while transitioning from ADSL which begs the question of precisely what advance we are making here?

Cost

Having spent years making large of the cost of Labor’s NBN network, the Coalition’s ‘affordable’ claim deserves some attention. The Coalition went to the last election with ludicrous claims that Labor’s NBN would cost $90Bn. In fact, Labor’s NBN was costed by KPMG-McKinsey and Analysis Mason twice, with the net cost found to be zero. This was based on the Government using Australia’s AAA credit rating to borrow $27Bn and the network paying for itself in at least 4 different ways in cost savings to existing infrastructure, health and power generation. Malcolm Turnbull’s Parliamentary Secretary Minister Paul Fletcher has more recently admitted that Labor’s NBN was costed by NBNCo internally at $56Bn and that the $90Bn scare campaign were ‘perhaps a little high’?. A little?

The Coalition’s wildly optimistic claims that the FTTN network would cost less than two thirds that of the FTTP network were also based on overseas examples where the incumbent telco already owned the network. The Coalition’s business model however will pay full commercial value for Telstra’s network making it one of the world’s most expensive FTTN networks.

In comparison the Coaltion’s FTTN NBN, which is unlikely to see out the next decade, is a short-term waste of money.

Environmental impacts

Under Labor’s NBN smart-grid technologies would have enabled more efficient power networks, resulting in significant power savings whereas, according to Melbourne University’s Rod Tucker, the proposed mix of VDSL and wireless technologies requires so much power that Australia will need to build 2-3 new small power stations to make it work. Good thing we’ve got all that coal…

The Spin

Despite all of these facts, it would appear Laming is intent on continuing to make all manner of claims he neither understands nor can back up. I expect this cyclone of misinformation to only increase as we creep towards the next election.

One of Laming’s most galling recent claims has been that the effective rebranding or assumption of the existing Telstra & Optus HFC cable network to ‘NBN’ is something new, something faster, something better. The harsh reality of the Coalition’s NBN plan is that if you have HFC cable in your suburb today, that is all you are ever going to have, so get used to that Friday-night Netflix fallover. And frankly, even if the cable handover were something new, is 46% of the Redlands connected something to shout from the treetops? What of the other 54%? What of the residents of Thornlands who have no connections at all or the Wellington Point residents who have had to take to Facebook to get their message through to Laming?

Laming also recently claimed that speeds of up to 91Mbps promised under the July rollout across the Redlands “Those speeds would enable a premises to stream up to 18 high definition Netflix streams simultaneously, or other bandwidth intensive applications such as online learning and telehealth consultations.” In fact this technology is already obsolete. Despite the wide availability of 4K TV’s in Australia, delivery of 4K content is up in the air. As NBNCo’s Tony Brown notes, “It is quite possible that an end user subscribing to a service over the NBN on a 100 Mbps fibre to the premise (FTTP) connection could still have significant problems streaming 4KTV video – or even HD video for that matter.” Somewhat at odds with Laming’s eighteen simultaneous Netflix HD stream over FTTN/HFC claims.

So where does this leave us? With Australia currently ranked 44th in the world in terms of broadband speeds and sliding rapidly, it appears the ‘Infrastructure Prime Minister’ is throwing Australia’s IT, creative, entertainment, health, power and other industries dependent on broadband communications, under the bus. A very expensive and rusty bus.

With the NBN under the Coalition in complete disarray it’s high time we heard from Labor precisely what they are going to do to rectify things should they regain Government at the next election.

Damien Buckley – 26 July 2015

Web Developer and Technologist Damien Buckley has operated multiple-­award-­winning digital agency, Propeller Graphic Design & Marketing with Wife Renee in the Redlands since 2004. In addition to numerous Australian and International Corporate websites, Propeller are responsible for well-­known local websites such as Stradbroke Ferries, RedFest and Karen Williams’ Mayoral Campaign website.

 

 

 

 

 

 

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7 thoughts on “The Coalition’s NBN – a huge waste of money

  1. Great article Damien. Looks to me like we’re spending 70 Billion on the NBN just to give everyone ADSL2.

  2. Whoever this Lamings fella is, it’s a true con job. Yes they are re-packaging what we already have. They are merely going to force those who can’t afford HFC currently and are on shitty telephone lines to pay twice as much as they can afford for HFC.

    The Liberal NBN is basically HFC and ADSL. And the ACCC is fully supportive on this.

    They are already marketing it very misleading. “Superfast FTTN. Get a wireless AC superfast router to increase your speeds” It’s a great con job. I am on 100mbps HFC and part of my problems is noisy crappy Wifi that AC is going to do bugger all to prevent and it goes down when it rains.

    A great opportunity has been lost ever since 2013.

  3. “The deal means those close to the pay-TV network will be able to connect to the pay-TV cable, known as Hybrid Fibre-Coaxial, for fast internet, with speeds of up to 200megabits per second. ”

    I think anyone wise enough would realise this is a crock. 200mbps LOL. In 10 years time maybe if two people are on the network at the same time ? They are not upgrading to Docsis 3.1 they are putting traps in for some other government to deal with an upgrade. They are basically repackaging what we already have and forcing people on telephone lines to pay twice as much for their internet.

    This is the Liberal NBN, give you what you already have. For those unlucky ones where they half baked the roll out in 1999 too bad. You get 1-12mbps.

  4. I think I share two characteristics with many Redland residents:
    i) I’m completely bamboozled by the technical arguments surrounding the NBN
    ii) I have extreme scepticism about the truth of anything uttered by Mr Laming – see the arguments around the recent Redlands 2030 meeting and Shoreline
    So thanks to Damien for a comprehensible summary of the spin. Laming does bang on about the HFS cabling quite a bit.
    This should be a nation-building exercise, the nature of which the Coalition, with their “knowing the cost of everything and the value of nothing” apprroach is singularly ill-equipped to address.
    Being of “ahem” mature age, I’m really not bothered about internet gaming etc, but I do think that home businesses and health services will increasingly depend in the internet, At the moment its mostly web industries that are hobbled by inadequate bandwidth. But remember dial up? It was only 20 years ago. We need a solution for the next 30-50 years, and we’re being offered one for the next five.
    So, unless Labor can come up with a credible plan that costs little, if anything, more that the current dog’s breakfast, and can get elected so they can execute that plan, we’re stuck with an expensive, half-arsed job. Thanks for nothing, Malcolm

    • Hi Andrew. Thanks for the support – hopefully the article has helped dispel a few myths and clear the air a little. Broadband in Australia is as you note, a dogs breakfast, which will no doubt cost the country for decades unless something is done about it.

      To correct one popular misconception the Coalition like to play on as it allows them to reduce the argument to their level – the Internet isn’t mostly only a factor for web industries – the Internet is intertwined with almost every facet of modern life – almost all Government services are based on, delivered with and entirely dependent upon the net’.

      When was the last time you went into Medicare to claim a rebate? How do you or your accountant submit your tax return? When you go to the Doctor or hospital, where & how do you think your records are stored? How are your salary payments managed, processed & transferred? Do you deal with Centrelink? have kids in Childcare? Their payments & rebates – entirely web-based. How do you do your banking, manage your shares or superannuation? Every time you swipe your card at the Supermarket. How much of your entertainment depends on the Internet for delivery – TV, movies, music, games? Traditional media is de-camping to the Internet more by the day. The modern military is one of the largest users of Internet-related communications. Power companies use the net to manage their grids & monitor/manage supply & demand. Security cameras, traffic lights, toll systems, emergency services, the police…

      Sure, people play games, laugh at cat videos and yes, some people’s fridges send their shopping list to their phones too but people need to realise just how integrated into just about everything the Internet is before they will come to realise the significance of ignoring the infrastructure developments this area will require I coming years.

      • The irony is dripping from NBN(Co)’s latest advertisement , they have a video about their connections enabling kids to connect with other kids via the internet in the form of console multiplayer gaming with audio headsets ! All this after tony decried the NBN under labor as a video entertainment system .

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