NBN: Abbott rejects “video entertainment system”


The Federal Opposition Leader has once again taken an axe to Labor’s National Broadband Network project, claiming this afternoon it wasn’t worth spending government money on a telecommunications upgrade which would primarily be used to fuel the nation’s passion for high-end video and gaming content.

Abbott and Shadow Communications Minister Malcolm Turnbull held a press conference in Sydney this afternoon to address the Federal Labor Government’s long-awaited release this morning of NBN Co’s business case, which disclosed a number of key details about how the company will build and operate the multi-billion dollar network over the next thirty years.

However, Abbott questioned the fundamentals of the NBN policy.

“The question is, should the taxpayer be investing $50 billion in that, when there are so many other competing needs – roads, railways, ports, health, education and the mobile phone system, which still drops out frequently?” Abbott asked.

“It’s pretty obvious that the main usage for the NBN is going to be internet-based television, video entertainment and gaming,” the Opposition leader added. “We are not against using the internet for all these things, but do we really want to invest $50 billion worth of hard-earned taxpayers’ money in what is essentially a video entertainment system?”

Turnbull said most of the high-bandwidth applications being discussed for use with the NBN did not use a lot of bandwidth. And even where high-bandwidth video services did exist, he said – such as the new Fetchtv offering being launched by ISPs like iiNet and Internode – they were usable over the existing broadband networks.

The Opposition Leader agreed Australia’s current networks were still stacking up well.

“If you look at the documents,” he said, “you see that there’s only going to be 1.7 million households passed by 2013. Optus and Telstra already pass more households than this with their existing cables that are capable of 100 megabits.”

With reference to the NBN business case, Abbott said there was “absolutely nothing” in the document which persuaded the Coalition that there was a case for going ahead with the investment, which he said he had previously called “the nationalised broadband network”, but which “should probably be called the nationalised broadcasting network”, given what the Coalition said was its focus on entertainment.

This morning at their own press conference and in statements, Prime Minister Julia Gillard, Communications Minister Stephen Conroy and NBN Co chief executive Mike Quigley highlighted NBN Co’s internally projected rate of return as being 7 percent – a number which didn’t take into account any additional benefits to accrue from the NBN, such as improved productivity. Hence, the Labor argument went, the network was viable as an investment in its own right.

However, the Coalition MPs repeated their long-standing call for the NBN project to be submitted to the Productivity Commission for a cost/benefit analysis to be carried out. “The Government still does not trust its case for that kind of scrutiny,” said Abbott.

Could the Coalition cancel the NBN in 2013?

The business case discloses that in three years’ time, when the next Federal Election will come into play, the NBN infrastructure will have been rolled out to some 1.7 million premises, with most of those receiving fibre directly to their door. However, Abbott did not directly answer a question on whether the Coalition would scrap the project if it won Government at that time.

“We will give you our definitive policy on this at the appropriate time,” he said.

“The point that we make at the moment is that there is nothing in today’s document which persuades us that this massive investment in taxpayer dollars is justified, and it is just wrong to invest this kind of money in a project like this without a full cost/benefit analysis, preferably by the Productivity Commission, which Labor is running away from.”

The Opposition Leader said the Coalition’s policy would always be to “respect the taxpayer” — and claimed Labor hadn’t done that, wasting billions on “school halls” and “roof batts”. “We just don’t trust this Government with this kind of investment, particularly given that they’re not willing to submit it to the Productivity Commmisison for cost/benefit analysis,” he concluded.

And Abbott took one last potshot at Conroy during the conference, pinioning what he said was Conroy’s penchant for insisting that the NBN would have an impact on other portfolio areas such as transport, because it would allow telecommuting, for example.

“This idea that you can fix everything by putting an ‘e’ in front of it is bizarre,” laughed Abbott.

Video credit: Delimiter


  1. Sure i could use fetchTV or something like that on my current connection, but I wouldn’t be able to do much else on said connection without seeing buffering times for the video

    • +1

      You summed that one up perfectly PointZeroOne.

      I want to be able to use FetchTV whilst also being able to video/teleconference, browse the net, download files, kids playing computer games, making VoIP calls, etc. The current network we have in place barely allows me to run FetchTV and if I do then I can’t do anything else.

      As usual, the Coalition have shown their lack of understanding, they have shown a lack of insight as to where everything is going and a lack of care that many people are wanting to use the Internet all at one time on the one connection. This is where the NBN will excell and this is why we need the NBN.

      Malcolm TurnBULL and Fony Abbott are a pair of technophobes acting in their own self interest and are showing their true collies in terms of understanding where the IC&T industry is headed and what is required for it to move ahead. All I can say is thank god they aren’t in government.

  2. I’m starting to think that Abbott is a seat-warmer … just holding Turnbull’s place while Malcolm takes a break. Abbott’s arguments about the insulation and (even more so) the BER stimulus are demonstrably wrong, and his fascination with current broadband speeds shows an incredible and disturbing lack of imagination.

    • Yeah that’s pretty much the way I feel about it as well — in today’s press conference Abbott had no gravitas at all, Turnbull stole the show. I really feel Abbott is a bit out of touch with the electorate as it’s developing this next decade.

      • Turnbull has put in a lot of hard work to restore the coalition’s credibility on communications policy so Abbott should really do his communications minister a favour and start paying closer attention to the NBN debate. Abbott appears unintrested in the problem of increasing data demand and his response to the opening question was rather poor. I think Turnbull’s body language in the first video from 0:46-0:56 was pretty revealing.

    • What I hate is that so much of the media do not point out that Abbott’s criticisms of the insulation scheme and the BER are demonstrably wrong. The ABC in particular never mentions the insulation scheme without the adjective “failed” despite the fact that the accident rate of the scheme was lower than the industry average, and more houses were insulated than anyone expected. Much of the “waste” that the Libs complain about was brought about by misinformed media pressure to go back and check jobs that were, in the main, fine.

      I’m more surprised by the same criticisms against the BER. Not only did an independent audit find little waste, but millions of Australians can see the benefits at schools their children attend. How Abbott expects to connect with people by telling them that the program is a failure even though it got their kids, or grandkids, or nieces and nephews a new library or outdoor area or hall – things that often schools had been trying to get for years or decades before the BER – it’s beyond me how that’s good politics.

      Ditto the NBN. People can see the benefits, both for themselves and for the nation, and it’s very hard, especially given his track record, to take Abbott’s criticisms seriously, especially when they are littlered with demonstrable lies and misrepresentations, as this one is again with his reference to $50b of taxpayers’ money. While that may fool some people into supporting the Libs, it’s just as likely to turn other potential Coalition voters away.

    • Agree 100% Ric..

      Let’s not forget, when Abbott became opposition leader, Rudd’s popularity was through the roof (enter insulation joke now…party puppets, LOL)…

      So Tony was sent in to lose, rather than have either Mal or Big Joe, the loser.

      However and although I do not like the man, Abbott must be given credit (although Labor did implode with their knifing of Rudd?) for almost pulling off a stunning victory that I’m sure, when he was first elected, even Abbott himself would have thought impossible…

  3. All this “it’s only good for TV and games” rubbish makes it perfectly clear that these clowns just don’t get it. Whether you’re pro- or anti-NBN, pervasive genuinely high-speed network access is useful for a lot more and has the potential to be transformative.

    These blokes are the “faster horse” brigade.

  4. Grr, I had to ragequit the browser after watching most of the 1st video.

    You *may* have *some* points on the NBN, but overstating and hyper-bolling your argument make me want to vote Green just to piss you off.

  5. This latest news article reconfirms my belief that there is no worthwhile government on either side worth voting for in this country. What do we do when we have such a poor choice? The same has to be said for state politics.

    Abbott’s latest comments are staggeringly shortsighted and ill-informed. Thinking back on all the money governments have wasted on various useless projects over the last 30 years we could have afforded three NBN networks.

  6. Tony, I don’t get it. Aren’t you supposed to be in favour of more affordable broadband?

    So shouldn’t you be happy that a sizeable number of households will probably redirect their current cable or satellite TV spend into IPTV, thereby subsidising the NBN and reducing the tax contributon needed to bring its social and economic benefits to more Australians?

    IPTV has never been the reason for the taxpayer to build the NBN, but it will produce huge revenues which will spare the taxpayer some of the construction cost.

  7. oh look it’s tweedledee & tweedledum and what to they have to say about the NBN this month, basically the same as last month: 50billion, pink batts, school halls blah blah blah… and now it’s a “video entertainment system” lol

  8. It’s $50 billion now. Where’d the extra billions come from? Every time Libs claim foul, the price keeps going up.

    Whether or not you support the NBN, it’s clear the Libs are still living in the 80s, which does not bode well, given they wish to cancel something they don’t really even understand.

    • Do not let yourself believe for even a moment that the Coalition do not understand the NBN and what it is.

      The problem is, they see it as a politically motivated opportunity to use the fact that so many people do not understand the NBN and what it is, to spread misinformation to those people, making it seem “pointless” to as many people as possible.

      The Coalition are not stupid – far from it – they are clever political tacticians. They know what the NBN is and what it offers – they see more value for themselves in destroying it, than allowing it to nurture economic growth in this country.

      • Yes Michael, but this is where the journalists need to make mention in their articles that the $50B price tag quoted by the Coalition is far from the actual costed amount of $27.5B.

        Where on earth does the Coalition get $50B from anyway? Political scaremongering is all it is.

        • They got the $50b from a figure where the “supposed” amount for a while was $37b, plus the value of the Telstra deal – ($9b to compensate for losing all their fixed customers to the NBN, $2b to get access to the pits, and some amount approaching another $2b to look after USO obligations while the network is built.

          The Coalition are calling this almost $13b capex, when it’s opex, so while in one context they are right, on an accounting basis they are wrong.

  9. And once against Abbot succently demonstrated why he does not speak for me. Bloody luddite.

  10. I’m sick of the government spending money on road funding. All it does it let people go watch more movies and sporting events. It’s disgraceful.

  11. Abbott misses the point. Australia has terrible internet. No matter what you use it for, its still terrible.
    For the record, do the Libs still own Telstra?

    • It is actually embarrassing to the max – slow mainly because of DPI traffic shaping, high latency, congestion and overpriced.

  12. Pink batts and the BER are the Lib equivilent of work choices. Yes there was good and bad in all these, but mass misinformation about all of it, plus very select reporting from biased news sources makes it a scare tactic on the general populous.

    If we do not once again goto the polls early and do wait for 2013, the NBN could very well be a rally cry for the Libs if they get in. “Look at this money on a half finished network labour wasted! Do not vote them in again. Never mind we added cost after cost after cost plus roadblocks to it. Who wants to buy my Telstra shares?”

  13. Abbott calls a press conference in response to this document, and the first thing he says is that the NBN will cost nearly $50b of taxpayer’s money. Given that the document itself puts the figure at $27.5b, and the return on that investment (never hear the Libs mention that, do you?) at 7% p.a., you wonder why Abbott didn’t just hold the press conference before the Business Plan was published – it’s obvious he’s not interested in criticising what it actually contains, just his bogeyman fairytale lie of what the NBN involves.

    Both parties know that the NBN is also estimated to increase GDP by 1% or more, which would increase tax revenues by about $2.5b+ p.a. (or an extra 10%+ on top of the return on investment). I doubt even Abbott would turn that down. Even if the Coalition win an election on a platform of smashing the NBN, it would be far smarter for them to instead send the NBN to the Productivity Commission, get a glowing report on its viability, and proceed. The only change they’d likely make is to screw up the access regime with a Telstra-like privatisation, because that would give them cash now at a cost to future generations, and the Libs have a great track record of that.

  14. It’s like watching dumb and dumber speak. Two guys that don’t a clue about the significance of the NBN to Australia prosperity now and the future. The NBN’s social and economic impact can not be measured at this point, until it is fully implemented.

  15. This guy truly is a moron. He wants to be PM but has no vision of what infrastructrue is needed in this country. Liberals had 11 years for “the market” to build it. They didnt. And to go wireless is laughable if you understand anything of engineering and lifecycle costings. The NBN must happen, it will have immeasurable benefits to australia, and the sooner these two idiots just let the NBN happen the better off australia will be. A future PM without vision we have already had that, with Little Johnny

  16. Does Tony brain?
    is Tony scare of Technology?

    I’m sick of the government spending money on “road funding”. All it does it let people go watch more movies and sporting events. It’s disgraceful.
    (National Broadband Network) NOT Road funding is GOOD

  17. Makes absolute sense. We all know it’s true – we’d use it all for pointless, trivial, entertainment crap when the money could be better spent on something more worthwhile.

  18. Ray, the NBN may be “pointless, trivial, entertainment crap” to you, but to me it means I’ll be able to get ABC TV and 1/10, which I can’t now. No, I don’t live in the boonies, but in Queensland’s third largest city, 90 km from the Brisbane CBD. Yes, I have a booster, and yes, I have made complaints.

    It also means not having to put up with an ADSL service that slows down to dial-up speeds at night and weekends.

    “the money could be better spent on something more worthwhile” like what, some more useless submarines and fighter jets? Pay for the NBN by scaling back some of that excess military expenditure. Mr Abbott has no idea – he would be PM today if he did.

    • Do you feel like you’re somehow entitled to those things, like you deserve them, as if they are owed to you? Why should we all pay so you get a better internet connection?

      But hey, you just proved Mr Abbott’s point – you are just one of many that want the NBN for entertainment purposes.

      “Pay for the NBN by scaling back some of that excess military expenditure. Mr Abbott has no idea – he would be PM today if he did.”
      But.. he doesn’t want the NBN at all.

      • Don’t be so quick to discount movies and video games as “pointless”, both are multi-billion dollar industries and getting bigger every year. Video games are a bigger industry today than the movie industry and the better placed we are to take advantage of that, the better off the country will be.

        Currently, there are only a handful of video game companies in Australia. The vast majority of those billions of dollars is going overseas to (largely) American publishers and developers. With a more vibrant and competitive IT landscape, more of those dollars can stay here.

  19. Speaking as a gamer, and avid gamer, i place the need for quality internet above that of my own health, needs for transprotation..even clean water and food.
    You have no idea how frustrating gaming lag is to a gamer.
    On a serious note, the E revolution is creating millions of jobs world wide in software, hardware and associated areas.
    Australia’s poor internet is limiting the choices of the next generation of australians, not just for gaming and entertainment, but for the jobs and money that can be made in these economic areas

  20. Ray Ray ray, you should be pro nbn youll get that more of that hi def grannie Porn that you and your ludite liberal twat brothers love and adore. We dont need to worry you idiots will be dead before 2013 anyways. If you havent got the joke Im saying your old because your stupid backwards twit

  21. My business/workplace would save a lot of time and money having more bandwidth available. We move tens of gigabytes of data per week that would move faster with the NBN. Previously we had to send all of our data on DVDS via courier (just a few years back) because the current bandwidths weren’t available. We are a SMALL business. Having instant access to large volumes of data from elsewhere in the country makes a huge difference to our business structure. Big businesses relying on digital transfers could only be better off.

    You can’t foresee exactly what people will use it for, but given that it only just catches us up to what other countries have already, I don’t understand any objections. My brother living in Japan has had 100mb connections (unlimited no-cap) for years. He can’t use half the applications he runs whilst visiting Aus, without having to wait forever and then have his account capped.

Comments are closed.