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  • Analysis, Telecommunications - Written by on Tuesday, May 29, 2012 13:11 - 212 Comments

    Higher 100Mbps uptake will spur NBN price cuts

    analysis If Australians continue to buy higher-speed 100Mbps NBN services at the current rate, it is likely that the real-world consumer cost of accessing the NBN will come down substantially over time, as the network will pay for its own construction much faster than the National Broadband Network Company had been anticipating.

    In the latest Senate Estimates hearing into the National Broadband Network held last week, NBN Co chief executive Mike Quigley disclosed some rather remarkable information about purchasing patterns amongst the three and a half to four thousand customers who have signed up to NBN fibre to the home plans so far.

    If you look at NBN Co’s corporate plan published in December 2010 (PDF), the company has previously been predicting that in the early years of its fibre rollout, the majority (52%) of customers who signed up for its fibre services would have picked the entry level speed tier it’s offering — a 12Mbps service which is slower even than current theoretical ADSL2+ speeds. The remainder would be split largely between the next speed tranches of 25Mbps (17%) ad 50Mbps (23%), with only a small number (8%) taking the highest speed 100Mbps plans.

    You can see this split in this graphic below.

    However, Quigley told the Senate Committee, when it came to the actual uptake experienced by NBN Co in the real world so far, this graphic had been somewhat inverted. “Overall, 38 percent of active services on our fibre network have been on the fastest speed tier, which is 100Mbps down,” he said. “Only 16 percent of the active services on our fibre network are for the entry-level speed tier of 12Mbps.” For the month of April, Quigley said, the trend was “even stronger”, with almost half of new customers signing up for the highest speed tier of 100Mbps.

    Now, there has been quite widespread reporting of these statistics released by Quigley, and for good reason. What they illustrate is a remarkably different pattern of broadband usage by NBN fibre customers than previously anticipated. What has not been as widely discussed, however, is what implications this kind of changing usage pattern might have on the NBN project as a whole.

    Firstly, it’s important to look at what the implications might be for NBN Co’s revenue projections. NBN Co will shortly release a new business plan, but if you examine its current plan, published in December 2010, you will find that its revenue assumptions are based on several factors.

    The company’s main two sources of continuing income will clearly be the different wholesale costs it charges retail ISPs; and the two major ones are what is known as the Acces Virtual Circuit (a fixed cost per customer), and a Connectivity Virtual Circuit (which changes, depending on how much data is consumed). These two factors and other associated inputs contribute towards what NBN Co refers to as its blended average revenue per user statistic, which gives a reasonable picture of how much money the company eventually expects to make from every Australian who signs up to the NBN.

    Now, the really interesting thing about NBN Co’s business plan so far is how conservative it is compared to the real-world uptake figures. The business case estimates a blended ARPU of just $33 to $34 per month over the first few years of the NBN’s life. However, this is largely based on the fact that NBN Co had been projecting that most users would take up its 12Mbps service. The following table shows the fixed monthly costs charged by NBN Co for the AVC portion of the ARPU:

    What we can see from this is that NBN Co had been projecting that a large portion of the $33 to $34 ARPU projection was based on most ISPs only paying $24 per month each for the large number of NBN customers using 12Mbps speeds. In actual fact, as Quigley revealed this week, the ISPs will actually be paying NBN Co $38 per month per user in terms of their fixed AVC costs — an extra $14 per month which will significantly change the blended ARPU figure.

    There is also an additional factor. NBN Co’s business case makes clear that “increasing average speeds are responsible for driving up usage, ARPU and therefore revenue”. In short, as more Australian customers take up 100Mbps speeds, it’s not just NBN Co’s fixed AVC revenue that will exceed its expectations, but also the variable CVC usage cost. In short, when you have 100Mbps speeds, you also download a lot more data than you would when you only have 12Mbps speeds.

    The net effect of all this is that NBN Co’s blended ARPU figure is currently looking like it might be radically higher than the $33 to $34 monthly income NBN Co has been projecting. Could that figure go as high as $40? $50? NBN Co hasn’t given enough granularity in its projections for Delimiter to easily calculate that; but given the extreme uptake we’re seeing in early stage NBN rollout zones so far, it doesn’t seem unreasonable. And NBN Co’s overall long-term revenues could jump by tens of percentages as well, based on current trends. We’re talking billions in extra revenue here — all because Australians apparently love 100Mbps speeds.

    This was a fact immediately jumped on by Greens Senator Scott Ludlam in the Senate Estimates session. “The whole premise of the business is based on the fact that nothing like those numbers of people will end up taking up your fastest package. If they do, you are running a much more lucrative business than the Minister was hoping you would,” he told Quigley.

    Now, in any commercial business, it is clear that faster consumer uptake of costlier services would simply result in that business being more able to either make more profits for its shareholders, or for that profit to be reinvested in its operations. In short, there is usually no real benefit to consumers of that business from spending more with it, apart from the fact that they get better services. Occasionally in the private sector companies do take a different approach, such as the way that Coles and Woolworths have cut the prices of their basic food offerings over the past several years, as they have made substantial profits. However, usually it is the case that companies will raise their prices in the long-term, rather than cut them.

    However — and this is the most interesting aspect to come out of the Senate Estimates session — this isn’t the case with the NBN.

    Asked what would happen if the higher than expected uptake of 100Mbps services on the NBN were to continue, Quigley pointed out that NBN Co had a responsibility only to return a fixed amount of income to the Government to ensure a return on its investment. Beyond that point, he said, NBN Co would start cutting prices. “Because we have a fixed return, we lower prices faster,” he said. “It is the subject of ACCC discussion — this is the Special Access Undertaking. If the SAU is accepted, we can only earn 350 basis points above the long-running average government bond rate. Once we get above that, we will just decrease prices.”

    OK, this has been a little complex, so let’s pause for a second and sum up the situation. For the first time, NBN Co has a reasonable sample size (three and a half to four thousand customers, including in very rural areas) on which to base its revenue projections. All indications so far have shown that those projections were incredibly conservative. If the rest of Australia takes up the NBN at the same rate as these early customers, the NBN will meet its fixed rate of return much earlier than expected, and start to cut its wholesale prices, which should result in better retail prices for customers.

    There are also other reasons to believe that NBN Co is being very conservative in its financial projections — and always has been. Take the following chart from NBN Co’s business case. It projects NBN Co’s predictions about customer speed uptake versus the predictions of major networking hardware supplier Alcatel-Lucent.

    As you can see, Alcatel-Lucent has always predicted the levels of real-world speed uptake that NBN Co is seeing now. And in fact, NBN Co itself admits this very fact in its business case. “This presentation illustrates NBN Co’s conservative expectation that the growth in demand for speeds will be considerably lower than the extrapolation of increasing speeds implied by the history of Internet access technologies,” the company says, in accompanying notes to the chart. Well, NBN Co, it looks as if you were wrong.

    All of this should also have a significant impact on the debate about the viability of the NBN.

    One of the Coalition’s most significant and long-running criticisms of the NBN policy has been its belief that the NBN would actually lead to higher long-term broadband prices than currently available. “Don’t be fooled. Don’t swallow the nonsense that an overcapitalised government monopoly is going to lead to lower prices,” Shadow Communications Minister Malcolm Turnbull said in a major speech in April. ‘You cannot suspend the laws of economics any more than you can suspend the laws of physics.”

    If NBN Co continues to experience the current rate of 100Mbps take-up, however, it seems very likely that the company will end up cutting prices. Whether those price cuts will end up impacting the retail ISP sector will be another matter for debate — but we find it very hard to believe that Australian ISPs would have an easy time raising their prices when NBN Co reaches its fixed rate of return and starts cutting wholesale rates.

    The strong uptake of 100Mbps speeds — 50% in April, don’t forget — also weighs heavily against Coalition comments that Australians don’t want such speeds.

    “The Rudd-Gillard government’s most notable contributions to infrastructure have been roof insulation that’s caused house fires, school halls built at double the normal cost and a National Broadband Network that’s digging up streets so that families can pay three times the current price for broadband speeds they don’t necessarily want or need and that could be delivered sooner at vastly lower cost,” said Opposition Leader Abbott in early May. Unfortunately for Abbott, it appears as if most Australians do want higher speeds.

    Of course, so far we only have a small sample size with respect to NBN uptake. Quigley himself said at the Senate Estimates hearing that he expects the ratios of uptake to level out over time. It’s early days yet. But with hundreds of thousands more customers expected to be signed up over the next year or so to the NBN, it won’t be long before we will know one way or the other just what sort of speeds Australia wants from the NBN — and consequently, just how much more profitable the project will be than it has thus far projected. I suspect we may be surprised by how many Australians do want 100Mbps speeds to their homes and business premises. Quite a lot more indeed.

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    1. Dean
      Posted 29/05/2012 at 1:47 pm | Permalink |

      I predict the phrase “tech geek tyre kicker” will be thrown around a lot in the comments here.

    2. Marcus
      Posted 29/05/2012 at 1:54 pm | Permalink |

      Dammnit. GIVE ME ACCESS!
      According to the maps I’m not getting it any-time in the next3 years :-( stuck on a effing RIM for another 3 years while houses 4 blocks down the road get 100mbit :-(((

      • Master_T
        Posted 29/05/2012 at 2:03 pm | Permalink |

        I hear that .

        +1

    3. Hubert Cumberdale
      Posted 29/05/2012 at 2:01 pm | Permalink |

      Ouch, bad week for NBN haters it seems.

      Seriously I’m not surprised though, it’s EXACTLY what I’ve been saying all along. The 12/1mbps only exists on fibre because of the satellite and wireless plans. Anyone with a choice would be crazy to opt for this when you can get far better value for money with a 25/5mbps and higher plan, it certainly proves to be the case with the least popular plan being the 12/1mbps plan and the most popular being the 100/40mbps plan.

      As for the corporate plan I think even and updated one won’t necessarily reflect real world numbers. They have to be conservative regardless of how many are choosing the faster plans.

      Also iirc Quigley said something about launching the 1gbps plan this year. It’ll be interesting to see what impact this has.

      • Master_T
        Posted 29/05/2012 at 2:07 pm | Permalink |

        1 Gbps would be Legendary.

        If they do launch it this year, the NBN’s about to become the game changer the Labor Party has been waiting for. At these sorts of rates getting access to 100mbps, it clearly shows what the project is capable of. Massive margins, a good return on investment and equal net for all.

        Heres hoping that if the LNP do win the next election that the greens are in full control of the senate. :)

        • Hubert Cumberdale
          Posted 29/05/2012 at 4:48 pm | Permalink |

          I’d also be interested to know where the 250/100mbps & 500/200mbps plans fit into all of this, will they initially be targeted to business users like the 1gbps plan and will they be attractive to home users. 250/100 is effectively 100mbps symmetrical, depending on the price I may consider this even if it is a few dollars more than the 100/40 retail price since if I were to get one of these plans right now from iiNet I would actually save $30.

      • Posted 29/05/2012 at 2:07 pm | Permalink |

        “Also iirc Quigley said something about launching the 1gbps plan this year. It’ll be interesting to see what impact this has.”

        I didn’t see that in Estimates. Ref?

        • Hubert Cumberdale
          Posted 29/05/2012 at 2:22 pm | Permalink |

          It wasn’t in the Senate Estimates, I cant remember the exact article where he said something specific about “this year” however I found a different one that practically confirms it:

          http://www.zdnet.com.au/1gbps-nbn-a-response-to-google-quigley-339314096.htm

          “Quigley said that the 1Gbps product release will be outed within six or twelve months of the release of the basic packages on the NBN.”

    4. Master_T
      Posted 29/05/2012 at 2:03 pm | Permalink |

      Thats impressive. I wouldnt have expected a take up in these sorts of numbers at such a high speed. I would’ve been one of those customers without a doubt, but for people who are less technically inclined (which is a likely assumption of the population en masse) this is interesting.

      The best part about this, is that the Coalition are inching further and further toward giving in and just letting the thing be; which is the best outcome for us all.

      While the LNP would have you believe that socialistic policies like this are bad for all concerned, this will change the country. How much is up to the country.

    5. FlopFlip
      Posted 29/05/2012 at 2:09 pm | Permalink |

      Come and dig up my street. In a years time you won’t even know it’s been done but the benefits of the fibre will last a lifetime.

    6. Posted 29/05/2012 at 2:14 pm | Permalink |

      Renai,

      This doesn’t represent a trend:
      - Firstly the sample is too small.
      - Secondly the major connection influencer, the disconnection of copper within 18 months of an NBN area being made available, is yet to kick in.

      Once we have all premises being forced to move to the NBN we will have some real data. At the moment the prime motive to switch to NBN is higher speed, so it is of no surprise that the current connections are skewed towards higher speeds.

      Let’s wait and see the revised business plan and the connection speeds once Telstra start disconnecting copper, it will more likely represent a more valid medium term result. However, my expectation is that the 18 month obligation to disconnect will not happen until close, or after, the next federal election. This does not bode well for NBN connection rates, or NBN Co results for the Labor Govt to take into the next election.

      • Marcus
        Posted 29/05/2012 at 2:21 pm | Permalink |

        lol Chris Coughlan.

        I’ll give you that it is a small sample.
        but seriously… “This does not bode well”?
        What, pray tell _would_ bode well?

        Maybe if more people chose the fastest plan possible… oh wait, they DID.
        You couldn’t shill any harder for the coalition of NO if you tried buddy.

        • Posted 29/05/2012 at 4:45 pm | Permalink |

          A high premise connection rate won’t happen until copper the threat of copper withdrawal, this is the bit that doesn’t bode well. It underpins the original NBN business plan and a few years on still hasn’t happened.

          • Posted 29/05/2012 at 5:02 pm | Permalink |

            “A high premise connection rate won’t happen until copper the threat of copper withdrawal”

            Given we’re already seeing rates of 34%, do you have some evidence for your assertion? Delimiter is a site based on evidence, not conjecture.

            • Monsta
              Posted 30/05/2012 at 3:46 pm | Permalink |

              Renai;

              I think the point that Chris was trying to make – and maybe made a fist of it – is that until the average ‘Mums & Dads’ that are projected to be connecting to the 12 & 25Mbps plans have yet to make the jump, and are not likely to do so until the copper is slated for removal. I would also hazard a guess that most non-networked households (think 70 year old pensioners without computers, and yes there are plenty out there) will not make the move until they absolutely have to.

              We have all heard the anecdotal reports of Telstra (and other providers like Optus) aggressively signing up contracts in soon to be rolled out NBN areas – and the people targeted were families on ‘complete’ bundles – line, calls, 20GB of internet via ADSL. The prices charged by Telstra for line rental is a pretty big incentive to keep subscribers on copper as long as they can – it’s pretty much pure profit.

              Right now, if you want speed and you have the fibre past your door, then 100Mbps is great and many businesses that I consult to would jump onto that immediately – mainly for cloud/remote backup purposes or other hosted services (hosted desktops, or remote RDP for business apps). I think you are seeing the people and/or businesses who want/require the extra speed jumping onto the 100Mbps plans as soon as they can, and this is the reason why we are seeing a ‘higher than expected’ rate of 50 & 100Mbps connections.

              I would also make the point that while 34% takeup in Kiama is great, there is other well-publicised factors at play there – mainly that there are no available ADSL ports and if you are lucky enough to get one, there is slow speeds, congestion and the reliability is pretty poor. Why wouldn’t you want the NBN if you lived there and wanted a stable connection?? I feel the take up rate seen there supports this.

              I’m looking forward to the NBN hitting my area, I am lucky enough to be in an area covered by the the first 3-year plan. I will connect as soon as I possibly can, however the speed selected will be based on the available plans from my provider of choice, and how it best fits with my needs.

              • Posted 30/05/2012 at 3:54 pm | Permalink |

                “the average ‘Mums & Dads’ that are projected to be connecting to the 12 & 25Mbps plans have yet to make the jump, and are not likely to do so until the copper is slated for removal”

                You have some evidence for this claim? I think 34% take-up in a rural area like Kiama would include a large number of ‘Mums & Dads’.

                • Posted 30/05/2012 at 4:03 pm | Permalink |

                  I’m sitting on the fence for this particular discussion there are certainly forces either way on this. Taking my family my parents are both in their late 60s and separated and both are currently on Telstra broadband. I am 90% sure that my father would switch to a decent speed NBN plan as soon as it became available to him he and his current wife are tech savvy and do a lot of stuff online. On the other side my mother has been dragged onto facebook to see photos of her grandkids and has just been introduced to Skype. Her connection now works and there is no incentive for her to change (or me to change it for her). I don’t have time to deal with long distance tech support issues. (The lights aren’t blinking anymore…… oh the power point is off…. etc)

                  • Posted 30/05/2012 at 6:46 pm | Permalink |

                    Toby, that’s fair enough. Technically it should be no different to your current setup. The NBN box will sit there happily and you will plug in your router/modem whatever into it, just as you would a phone line. It should give no trouble and act as a passive phone line, like normal.

                    But I can see it may be easier to leave the less technically minded part of your family on their current service. Make sure you do have a look though. Even at low speeds and tiers, the NBN plans could still save them money and make things easier :)

                • Monsta
                  Posted 30/05/2012 at 4:44 pm | Permalink |

                  > You have some evidence for this claim? I think 34% take-up in a rural area like Kiama would include a large number of ‘Mums & Dads’.

                  Of course there is no evidence – it is my opinion only. Telstra doesn’t provide those figures, neither does any other provider as it is considered commercially sensitive information.

                  In the case of Kiama – I absolutely agree that many of the 34% would be ‘Mums & Dads’ – those that could not get ADSL though lack of ports, lines that are too long, or technology blockers. That was the whole point of my post – the uptake in Kiama is driven by the quite frankly woeful copper infrastructure. The Kiama area has been a wasteland in terms of internet connectivity for years – there’s enough posts on Whirlpool to support that, along with Gunghalin & Point Cook.

                  I would expect that the NBN uptake in Kiama to roll very quickly indeed, at least until such time that the number of users connected and no longer on ADSL then makes the copper infrastructure easier to live with for those that remain either by choice or by contract. While the sync speed on that RIM might still be 3-5Mbps due to a noisy or long line, at least they can download at that speed 24/7.

                  NBN uptake will be driven by one of 4 reasons.
                  1) Early adopters or those that want ‘the latest’ technology ASAP; or
                  2) Users internet needs are not being met by current offerings (Speed, reliability, price); or
                  3) Users who can save money by moving to an NBN service (with VoIP?) or get better value from their monthly spend (speed multiples & more data for +$10/mo); and
                  4) The current product (POTS + ADSL over Copper) being withdrawn.

                  • Posted 30/05/2012 at 6:41 pm | Permalink |

                    “The Kiama area has been a wasteland in terms of internet connectivity for years – there’s enough posts on Whirlpool to support that, along with Gunghalin & Point Cook.”

                    Monsta, what makes you believe there aren’t many hundreds of areas around Australia that AREN’T wastelands for ADSL? Why do you think the NBN is so popular in the polls? ADSL availability and reliability in this country is appalling. I would not be surprised to see the sort of up take they’ve seen in Kiama in other areas. I have nothing to back that up, other than the international studies that show our average download speed is about 5Mbps. Considering we have nearly 3.2Million premises that can technically access “brilliant” HFC speeds, which would skew the numbers high for this amount of speed over this many people, we must have some TRULY shocking areas to STILL get such a low average speed.

                    34% I think would be pretty much on par with what we’ll continue to see, if not slightly higher. Obviously definitely higher in Greenfields (der) and HFC areas as they get decommissioned.

              • Goresh
                Posted 31/05/2012 at 7:44 am | Permalink |

                ” The prices charged by Telstra for line rental is a pretty big incentive to keep subscribers on copper as long as they can – it’s pretty much pure profit.”

                Actually, the component of “line” rental that goes towards the actual copper line does not cover costs.

                The “line” rental includes the switch and the backbone transmission that will remain after the switchover to the NBN.

                What the “line” is worth to Telstra is that it allows them to offer a package deal which is worth a lot from a marketing perspective. Once that is gone they are on the same footing as every other ISP, hence the mad push to sign people up on contracts prior to NBN.

      • Posted 29/05/2012 at 2:27 pm | Permalink |

        Sorry Chris, I don’t buy your argument. I quote from Conroy in Estimates last week:

        “The take-up in Willunga is over 30 per cent in a year … You can go to Kiama, south of Wollongong; 34 per cent take up.”

        These are areas where the copper has not been switched off, and they’re rural areas as well. Yet one third of residents have already switched to the NBN. The major connection influencer, as you say, is NOT the switching off of the copper. It is the fact that a shiny new thing is available and Australians love shiny new things.

        “This does not bode well for NBN connection rates”

        I have no idea what kind of drugs you are on. If 50 percent take-up of 100Mbps services in Australia doesn’t bode well for connection rates, than I will eat my hat.

        • Posted 29/05/2012 at 4:34 pm | Permalink |

          Passed vs connected premises not speed!!

          • Posted 29/05/2012 at 5:11 pm | Permalink |

            That would be a poor comparison, given that people in contracts arent able to move to the NBN even if they wanted to. Given the areas currently passed by NBN fibre (such as Willunga and Kiama) are more rural than areas like Brunswick or Aspley, the locals there are almost certain to be locked to Telstra contracts.

            The comparison is almost moot purely on this fact alone – that Telstra arent obligated to move those customers until the copper is switched off, which isnt for some time. In that time, the estimates your citing would change again.

            What I do think is stupid – is the whole ‘Take-up rate’ claims by the LNP, they know full we’ll 93% of the population will have to end up passed by fibre, those that want to convert can. Take up rates are pointless estimates if everyones eventually going to HAVE to move or cancel their existing services if the need isnt there.

            • Mat_L
              Posted 29/05/2012 at 11:05 pm | Permalink |

              Renai have you considered the uptake rate being quoted include trial services ? how many of these service have converted to a paid services and how many are still on a trial services ?

              The mainland trial sites for simplicity sake let assumes are 3,000 premises each (approximate size of an FSAM) thats approximately 15,000 give or take and at 3,500 services connected that does not look like 34% to me. Happy for you to show me a different set of evidence.

              Until copper disconnection is enforce then the full effect will be seen, and why do think you that early adopter effect is only 5-10%, it would be logical if its a new technology, NBN is not a new technology its a network upgrade why should the early adopter not be greater, given that most are on it or have had at least several years on some form of broadband.

              • Posted 29/05/2012 at 11:29 pm | Permalink |

                Mat_L

                “The mainland trial sites for simplicity sake let assumes are 3,000 premises each (approximate size of an FSAM) thats approximately 15,000 give or take and at 3,500 services connected that does not look like 34% to me. Happy for you to show me a different set of evidence.”

                One, you’re “assuming” an awful lot here. Do you KNOW the FSAM is that big in each location?

                Two- In November last year, take up rate was about 11%- http://www.theaustralian.com.au/australian-it/ultra-fast-nbn-has-sluggish-take-up-with-only-one-in-nine-connected/story-e6frgakx-1226199546472 (and this is the Australian we’re talking about here….I wouldn’t doubt it was higher than THEY report, but we’ll go with that.

                In March this year- 25% – http://www.smh.com.au/it-pro/government-it/nbn-boss-defends-25-per-cent-takeup-rate-20120301-1u4a2.html

                And now we’re getting reports of 34%. At the moment, that is not confirmed (except in Kiama, where it is already higher than that), but the new Corporate plan is out shortly and I will stand by whatever it reflects, 34% or not. However, if it is 34%, it seems we have actually reached well into the numbers for the “Diffusion of Innovation” (http://en.wikipedia.org/wiki/Diffusion_of_innovations) which states that after 16% adoption, we’re into Early Minority adopters, well past early adopters and innovators. This growth rate (11%, 25%, 34%) broadly agrees with general principles around business innovation growth, followed by the business world and, also, it must be said, Malcolm Turnbull.

                These take up rates are not made up. They’re actual. The last is TBC, but I have little doubt the current Corporate Plan will reflect these rates and further numbers will become apparent shortly, as they constantly do.

      • Hubert Cumberdale
        Posted 29/05/2012 at 2:29 pm | Permalink |

        “At the moment the prime motive to switch to NBN is higher speed”

        Motive to switch to high speed data transfer network higher speeds you say?

        http://www.gifflix.com/files/f97d033e87ca.gif

      • SG Warren
        Posted 29/05/2012 at 6:22 pm | Permalink |

        You do realise a sample of 4000 people is about 4 times larger than a News poll, right?

        • Gav
          Posted 30/05/2012 at 10:32 am | Permalink |

          Was going to say something similar :)

          Seriously though, by any analytics basics you care to look at, any sample size greater than 1000 is one you can rely on. So a sample over 4000 is pretty solid evidence.

          • seven_tech
            Posted 30/05/2012 at 10:36 am | Permalink |

            I’d say it’s a pretty good sample. But I still think Quigley is right in saying we’ll see the ratio shift around a bit as more people sign up. I think the 50Mbps level (not necessarily the tier 50, but the average speed overall between tiers) is probably the most likely outcome overall, but there’s no question this sample indicates it’s significantly higher than many anti-NBNers and even NBNCo. itself were predicting.

            • GongGav
              Posted 30/05/2012 at 11:36 am | Permalink |

              At the end of the day, thats the real point of this – of the expected uptage plans, the highest plan is 4 times higher than expected. That means the original estimates were incredibly conservative.

              Still fun to look at people try to shoot the numbers down.

              I’ll be either a 50Mps or 100Mps plan myself when its rolled out here over the next 13 months or so (scheduled to start in July), it depends on a couple of factors. So I wont be one of the 50% expected to be on the lowest plan even though thats STILL faster than the 6Mps I ‘enjoy’ now with my ADSL2+…

              FYI, the Gav immediately above is me. Given there are 2 of us posting under the same name, I got around to using a new name.

    7. Mark
      Posted 29/05/2012 at 3:18 pm | Permalink |

      “we can only earn 350 basis points above the long-running average government bond rate.”

      the other side of the equation is interesting as well. Currently Govt bond rates are at all time lows

    8. Posted 29/05/2012 at 3:39 pm | Permalink |

      My understanding and confirmed with NBN is that voice replacement service over NBN is problematic from a service level perspective, hence delay in Telstra’s obligation to disconnect of copper. Telstra continues to provide voice over PSTN even if ADSL is migrated to NBN access.

      Rural areas are relatively poorly served with copper so you’d expect a higher take-up of NBN.

      The NBN 70% connection rate is easily reached if copper alternative is removed, question is what service will those that are happy with copper opt for? I do agree that it will be higher than 12/1, just because Telstra has opted to sell 25/5 as the lowest speed connection in their retail offers. But will most be at the top end speed; I’m not sure.

      There are two groups to consider:
      Those that actively choose NBN.
      Those that will be forced – This hasn’t happened yet and it substantially underpins the NBN business plan to drive 70% and better connection rates.

      • Posted 29/05/2012 at 5:19 pm | Permalink |

        “voice replacement service over NBN is problematic from a service level perspective”

        No, this is only a (short-term) problem for Telstra — not for the other carriers, who already offer VoIP (including Optus over its HFC cable network, as I understand it). As for the 70% … what do you not understand about the fact that the NBN has already reached over 30% in several sites, with citizens signing up voluntarily? I don’t see another 20% at least as being tough for the NBN to get to in those sites. Sure, there may be a minority who will wait for the copper to be disconnected, but it will be that — a minority.

        Frankly, Chris, you have perpetuated a number of falsities and myths on Delimiter today, and you’re ignoring the evidence that we’re presenting to you about NBN uptake so far. If you don’t calm down and stop writing misleading statements here I will shortly be of a mind to put you in the sinbin for a week.

        Please note Delimiter’s comments policy:

        http://delimiter.com.au/comments-policy/

        At the moment your misleading statements are harming the discussion. This is your warning. Present evidence for your claims or cease making them.

        • Posted 30/05/2012 at 11:28 am | Permalink |

          Further to this Telstra already has a large VoIP infrastructure supplying their business products. They have the technical expertise and know how and I am sure are just working to ensure that when they do switch on the VoIP access to residential users it will scale and work effectively. There is a large difference between a small ISP connection say 100k voice users and Telstra moving 1 million plus lines across.

      • Monsta
        Posted 30/05/2012 at 2:56 pm | Permalink |

        Chris, the reason Telstra still runs POTS over copper rather than migrate to the UNI-V service over the NBN is:
        1) The copper is still connected; and
        2) They can still extract a line rental from those using it.

        I don’t expect that to change until the copper is disconnected and removed.

        (Just an aside, since copper is expensive stuff, when it is pulled out does Telstra sell it to metal recyclers and get paid?)

        • Geoff U
          Posted 30/05/2012 at 3:18 pm | Permalink |

          “(Just an aside, since copper is expensive stuff, when it is pulled out does Telstra sell it to metal recyclers and get paid?)”

          This will most likely depend on the cost of removing the copper versus the price for which the copper will sell.

          Major copper backhaul could probably be sold for a removal-vs-sale profit, whereas the small copper lines to each house would probably fetch a loss.

          Also, in regards to a question I asked at a Community Information Session, I recall an NBN Co Rep telling me that under the NBNCo-Telstra agreement, Telstra are not allowed to sell the copper domestically as it would drive our copper price down through the floor (basic supply-vs-demand).

          So the copper would have to be sold overseas, bringing the cash from the sale back into Australia, which is always a good thing.

          • Goresh
            Posted 06/06/2012 at 1:22 am | Permalink |

            Copper IS expensive stuff but pulling it out of the ground would be even more expensive.

            Where it’s in conduit and it has to be pulled out anyway to make room for fiber, sure it makes sense to sell it off as scrap.
            Where it’s direct buried, it would cost thousands of dollars a kilometer to pull it up.

      • Goresh
        Posted 31/05/2012 at 7:58 am | Permalink |

        The telephone side of the NBN equation is still in early trials and cannot be offered to customers.
        NO customer has been switched to the new service because as yet there is no service to switch to.
        Incidently, Telstra was NOT selected to do the trials, I do not know if they even tendered.
        This refers to the telephone socket on the box, not VOIP which is a different matter altogether since it doesn’t care how the packets arrive.

        I think you will find that once it is approved, Telstra for one will be falling over itself to switch customers across because thats when they get paid by NBNco not before.
        There is a big, ongoing, cash injection and no maintenance costs versus ongoing expense of maintaining a dilapidated maintenance intensive failing infrastructure.

        • Posted 31/05/2012 at 8:21 am | Permalink |

          “The telephone side of the NBN equation is still in early trials and cannot be offered to customers.”

          Huh, indeed it is. Well, you learn something new everyday, I was under the impression it was out of tril, but apparently not yet.

          http://afr.com/p/technology/nbn_co_trials_new_telephone_technology_1QUwM5Ueq3FifUbQo8BlEK

          Makes sense though. The full rollout has not yet started and they need this in operation before they rollout to too many people, just to make things easier for consumer switchover.

          Definitely agree with Telstra falling over itself to get customers on the NBN though. They’re making HUGE pushes to get people on their network so they can be paid for each one when they’re migrated. I’m SO very glad Telstra will finally be out of the game in terms of wholesale with this sort of attitude…

    9. Gav
      Posted 29/05/2012 at 3:52 pm | Permalink |

      A couple things that are important to note here;
      1) Quigley did qualify his remarks on the speed band uptake by acknowledging there was likely some early adopter bias towards the higher speeds. A detailed analysis would need to consider the uptake percentage in each town, and the previously available services. If only 34% of people in a town have connected (and that may be due to contract issues, or lack of awareness) then you may not have a representative sample at this stage (http://upload.wikimedia.org/wikipedia/commons/0/0f/Diffusionofideas.PNG at a take-up past 50% you can get more confident). Take-up won’t be an issue eventually, but right now it will influence revenue projections.

      2) Quigley ignored the decision he can’t make: infrastructure investment. Price cuts would likely occur in consultation with the government, and the government may direct NBNCo to engage in capital expenditure rather than price cuts. The areas for further investment could be any one of:
      - increasing the fibre footprint,
      - moving more infrastructure underground,
      - upgrading endpoint equipment,
      - upgrading or adding to the transit network.
      Of course, most of this won’t be a worry for a few years, but we’re already seeing the first upgrade of endpoint equipment.

      • Lachlan
        Posted 29/05/2012 at 4:26 pm | Permalink |

        Good points Gav,

        But about the earlie adopters excuse, one way to tell is to look at the total % of households passed using the 100Mbit service.
        Per the plan,10 % using100Mb of 70% of households using the NBN giving 7-8% of households using 100mb.
        Per estimates, 30% using 100Mb of the 34% of houseolds using the NBN giving 9-10% of households using 100mb.
        So even if all the people who would use 100mb are using it already, there is a couple of percent higher usage rates for the higher speed tiers. The plan has this being reached in 2015-2016 time period. So one part of the NBN plan is a couple of years ahead of schedule.

      • Hubert Cumberdale
        Posted 29/05/2012 at 5:01 pm | Permalink |

        ughhhh laggards, just think if Abbott and his zoo crew chums win the next election they’ll be forcing everyone to be laggards with them.

      • Posted 29/05/2012 at 5:27 pm | Permalink |

        I’m sorry, but 34% is a very representative sample no matter which way you cut it. Early adopter percentages are usually 5-10%.

        • Mathew
          Posted 29/05/2012 at 9:22 pm | Permalink |

          As explained below, I think the 34% is for one site only (probably Willunga, SA which was reported at 29% last year). The actual take-up rate for fibre is almost certainly below 18% and could possibly fall to as low as 10% depending on the number of premises where services can be orders.

          • Posted 29/05/2012 at 9:27 pm | Permalink |

            “The actual take-up rate for fibre is almost certainly below 18%”

            Citation needed.

            • Mathew
              Posted 30/05/2012 at 9:23 am | Permalink |

              I posted this elsewhere in the thread, but as requested, this is what I base the 18% maximum on:

              Now 3,700 self selecting premises on fibre would hardly be considered representative of the a 12 million premises roll-out. If the 34% figure was an average across all sites, then there would be ~10882 premises passed, yet we know in NBNCo’s six monthly report to end of December 2011 (published in April) that on 16-March-2012 there were 18,200 premises that could order connections. At best that gives 18%, but it would be reasonable to assume that more premises have been available to order connections since then.

              • GongGav
                Posted 30/05/2012 at 1:56 pm | Permalink |

                How many of those 18,200 premises are greenfield premises that dont actually have a house built on them…?

                Just be careful how you frame your numbers here. In theory they might be able to get an NBN connection, but in practice they are counted differently. Its not hard to look as that being delibrately misleading to make the situation look worse.

                The report above doesnt even look at those numbers anyway. Its purely looking at who IS connected, and what percentage has connected to the various levels.

                In the context of this story, your 18% number, however you figure it, is meaningless. Its not what the story is about. Of the 3700 connections, 34% are at the highest speed the NBN currently offers vs the expected figure of 8%.

                34% is the right number, your 18% is a different story alltogether. On that though, if 18% have VOLUNTARILY taken up the NBN, to tbe best of my knowledge that is also above expectations.

                If I’m wrong, someone will provide a link. Maybe its on that magical page 77… Wont be hard, just find the expected rollout figures for June 12 (or March 12 if you can), and expected connection figures (ditto for March 12), and you have an expected takeup rate.

                • Mathew
                  Posted 31/05/2012 at 7:40 pm | Permalink |

                  > 34% is the right number, your 18% is a different story alltogether. On that though, if 18% have VOLUNTARILY taken up the NBN, to tbe best of my knowledge that is also above expectations.
                  Why should it be above expectations when you are clearly aware of the page 77 of the NBNCo Corporate Plan which lists the take-up figures.

                  > If I’m wrong, someone will provide a link. Maybe its on that magical page 77… Wont be hard, just find the expected rollout figures for June 12 (or March 12 if you can), and expected connection figures (ditto for March 12), and you have an expected takeup rate.

                  It’s a shame you didn’t take the next step of actually opening the Corporate Plan, turning to page 77 and looking at the numbers. For June 2012, NBNCo predicted that 316,000 premises would be passed by fibre and 137,000 premises would be connected (43.35%). To put that number in context 2011 = 60.34%; 2013 = 40.3%; 2014 = 58.61%. Now I accept that delays with the Telstra deal slowed the rollout, but I don’t see why it should impact the take-up percentage.

                  • Posted 31/05/2012 at 8:55 pm | Permalink |

                    “It’s a shame you didn’t take the next step of actually opening the Corporate Plan, turning to page 77 and looking at the numbers. For June 2012, NBNCo predicted that 316,000 premises would be passed by fibre and 137,000 premises would be connected (43.35%). To put that number in context 2011 = 60.34%; 2013 = 40.3%; 2014 = 58.61%. Now I accept that delays with the Telstra deal slowed the rollout, but I don’t see why it should impact the take-up percentage.”

                    Actually Matthew, you answer your own question there. Look at the takeup figures they have predicted. Are they linear? No. There would be a myriad of reasons for this and if they’re not linear, you cannot correlate that, because they’re low now, they may not be considerably higher later. They could equally be considerably lower. My point is, to say at this stage that the current takeup rate is poor because it is not around what they predicted has no correlation to reality because the data is not linear in progression.

                    We are likely to see take up rates bounce around depending on locality, their access to better than normal services, or worse than normal, demographic etc. To condemn NBNCo. now with, as you’ve pointed out, a massive delay outside their control and a takeup rate prediction that they themselves have said isn’t linear, is useless speculation. Once we have several hundred thousand people across vast tracts of Australia, it will become MUCH more clear what it is likely to be. This also holds for the tier takeup. At the moment it is higher than anyone predicted and while, I believe, it will stay there, we currently have no serious evidence that it will. We need more information, from the new Corporate Plan AND from more numbers.

                    I’ve been saying since the beginning of these comments we need to be careful about predictions at this stage. Could Renai be right in the ARPU increasing to $50? Possibly- this is an analysis piece, from both facts and perspective, it could indeed turn out that way. Equally, could it also go the other way? Again, in my view, unlikely, but it is possible. We will see hundreds of thousands of premises passed AND connected over the next year before the election. How about you get back to me in June NEXT year and THEN tell me the figures, which I believe will be slightly lower, but still well above predictions, are wrong?

                    We have these data from NBNCo. We are discussing the data we have NOW. How about we leave the random opinions based on nothing more than speculation of non-linear progression at the fingertips, rather than on the keyboard?

        • Gav
          Posted 30/05/2012 at 10:24 am | Permalink |

          The trouble with the 34% or fewer is that we don’t know anything about the people in that sample. A –random– national survey of 1000 people is generally enough to be representative of the population for a yes/no question to within a few percentage points of error (e.g. the latest Newspoll was 1148 interviews with sampling error of +/- 3%). This survey is not random, it is based on paying customers for a brand new service. Additionally, because we’re looking at stratified groups we shouldn’t assume that 1000 people would be enough to produce a representative sample. Note too that in estimates Quigley said there was much better take-up in the towns where the councils were actively engaged in promoting the service. There is definitely bias, but the indications are positive for NBNCo.

          • GongGav
            Posted 30/05/2012 at 10:45 am | Permalink |

            Hate to disagree with you Gav, but the numbers are perfectly fair. The plan was expecting 8% of subscribers to be on the highest plan, and its turned out to be 4 times that amount. However you cut it, thats a much better than expected return for this early stage of the rollout. It doesnt matter WHERE they are, just that they are connected to that speed. You dont NEED to know anything about whos connected, there’s simply a higher percentage than expected.

            Look at the first graph, it cant be expected to be for any other reason but estimating this sort of situation – in 2012, having 50% of however many are connected on the lowest plan and 8% on the highest. Its the reason NBN HQ are high fiving today, and Abbot is rumored to be mumbling something like “is that laser connection thingy of Jonesy’s still a goer?”…

            You’re spot on about the 1000+ for a survey though, basic analytics says that anything more than that is a respectable enough sample size for the numbers to be reliable. Which is one of the reasons you always seem to see those Gallop polls be 1100 or so.

            By the way, as there are 2 of us posting as Gav, I’ll start posting as GongGav to remove confusion. There’s been a few times (including this thread) where we could easily be confused as each other :)

      • Goresh
        Posted 31/05/2012 at 8:06 am | Permalink |

        34% is a representative sample in anyone’s book. The question however is what they represent.

        As early adopters they will include people who’s contract has expired (roughly random) and early adopters after the new whizz-bang thing (those who cancelled existing contracts).

        The point is moot however. Based on the last month of data with 50% highest rate uptake, the NBN has ALREADY passed the projected connection rates for higher data even if every customer who connects now did so at the minimum rate which is HIGHLY unlikely.

        • Mathew
          Posted 31/05/2012 at 7:42 pm | Permalink |

          > As early adopters they will include people who’s contract has expired (roughly random) and early adopters after the new whizz-bang thing (those who cancelled existing contracts).

          I wasn’t aware of RSPs preventing customers in contract from transferring to the NBN as long as they stayed. It would be in an RSP’s best interest to migrate customers while they are locked in, rather than risk a customer looking around.

          • Posted 31/05/2012 at 8:58 pm | Permalink |

            “I wasn’t aware of RSPs preventing customers in contract from transferring to the NBN as long as they stayed. It would be in an RSP’s best interest to migrate customers while they are locked in, rather than risk a customer looking around.”

            I have no facts on this point. However, it would GREATLY surprise me if Telstra were happily letting people break contracts- why would they? They SHOULD lock them in, suck them dry and then they’re paid AGAIN to transfer them, regardless of who they go with on the NBN. Seems like a pretty good reason to keep them in, not push them out.

            • Mathew
              Posted 01/06/2012 at 2:04 pm | Permalink |

              Considering that Telstra are paid for every connection, it is in their best interests to migrate customers as quickly as possible. If they can migrate customers while under contract and extend the contract for 24 months, then even better.

              It is commonly acknowledged it is much more expensive to obtain a customer, than retain an existing customer.

              • seven_tech
                Posted 01/06/2012 at 2:22 pm | Permalink |

                “Considering that Telstra are paid for every connection, it is in their best interests to migrate customers as quickly as possible. If they can migrate customers while under contract and extend the contract for 24 months, then even better.”

                Mmmm, maybe. We’re both talking opinions here, so there’s no wrong, but I’d still disagree. They get paid no matter what, as I understand it. Whether that be now, or in 24 months when their contract, on cable/ADSL, is up. If the customer is happy on Cable/ADSL, they have a higher profit margin on that, so they’d have more incentive to keep them on longer and THEN get paid to move them to the NBN next time. If the customer is unhappy, then, you’re right, they have incentive to move them onto the NBN with Telstra and that should improve their feelings and Telstra gets paid for it.

                I guess it would be highly dependent on your current Broadband situation and customer satisfaction with current service. It would gain them more money overall to keep them on their own infrastructure now and transfer later, but, if they’re unhappy and threatening to leave, as you say…

                “It is commonly acknowledged it is much more expensive to obtain a customer, than retain an existing customer.”

    10. Jacob
      Posted 29/05/2012 at 4:36 pm | Permalink |

      I honestly don’t see the point of getting a 100Mbps connection. I’m fortunate to access speeds of 10Mbps but unfortunate in that no other ISP bar Telstra has installed their DSLAM into my local exchange (zone 2) which condemns me to paltry quota allocations when compared to what’s on offer by native ISP plans. 10Mbps for me is fast enough at the moment but I accept the fact that the 0.7Mbps upload speed isn’t acceptable to have HD video talk (currently needing 1.5Mbps according to Skype) which will most likely become more prevalent in the future. Therefore if the NBN ever comes to pass my house I would most likely opt for the 25/5 Mbps and choose a plan that has 200-300GB. This would cost the same as what I’m paying now. So as you can see I find it hard to justify getting 100Mbps given there isn’t much that can take advantage of it. Perhaps in the next 10-15 years when 4K and 8K TV’s become the norm higher speeds (& quota) will be needed but I think until that time 50 and 100Mbps download speeds are overkill. Also, I think given HD video requires a minimum of 1.5Mbps upload, the 12/1 Mbps plan seems a bit irrelevant. If a 12/2Mbps was assumed to be the ubiquitous minimum it might make new and innovative applications of the NBN to come to fruition faster.

      • Mike S
        Posted 29/05/2012 at 4:41 pm | Permalink |

        I think you’ll find that the 12mb/s is shown there because that is the wireless/sat minimum. It doesn’t seem like many/any are providing 12mb/s over fibre.

        “Perhaps in the next 10-15 years when 4K and 8K TV’s become the norm higher speeds (& quota) will be needed but I think until that time 50 and 100Mbps download speeds are overkill.”

        Luckily the network is to be finished in 10 years. Sounds like pretty good timing if you ask me. :)

      • Posted 30/05/2012 at 6:39 pm | Permalink |

        “I honestly don’t see the point of getting a 100Mbps connection.”

        I’m honestly curious as to why you’re reading Delimiter, then ;)

      • Alex
        Posted 30/05/2012 at 7:01 pm | Permalink |

        Hey Jacob,

        Glad you can see the vastly superior NBN plan will cost you about the same as your current plan and don’t forget you will have the “choice” of other RSP’s not just Telstra…

        You are proof that the NBN offers better value, better competition and even though you don’t personally need the faster speeds yet, the ability for you to upgrade when required.

        :-)

        • Jacob
          Posted 31/05/2012 at 7:22 pm | Permalink |

          “…NBN offers better value, better competition…”

          I agree.

          I’m glad that, as you say, the NBN offers faster speeds when they become required. My point was (& is) that at this present time there is no need to have 100 Mbps when there are no applications to utilize such bandwidth.
          Can you enlighten me as to what a 100Mbps connection will enable me to do? I acknowledge that perhaps a family (or housemates) with avid internet users may require such bandwidth but even then I doubt they’ll ever need to use it all up at the same time. The tech side of me would love to get 100Mbps just because I can (if the NBN continues). But at the same time my more reasonable, logical thinking tells me otherwise.
          Can you persuade me?

          • Alex
            Posted 01/06/2012 at 3:31 pm | Permalink |

            I just did…

            But to answer your new question (as it seems you are a closet doubter, after all).

            If you were to get married and were looking to buy a car and a home, would you buy a two seater car and 1 bedroom home or say, gee a family could come along and prepare accordingly.

            Of course the doubters answer is, it depends on what I can afford… and fair enough. So that being so…

            It’s the same here and having one of the most robust economies anywhere, although the cost of the NBN isn’t coming from budgetary revenue (such as our income taxes) at around 1% of annual revenue, the NBN is very affordable, will be advantageous to ALL Aussies, repay itself (unlike pretty much all other governmental spending) and become a valuable asset for resale…

            Seriously, apart from political or selfish bias, what is the problem?

            • Jacob
              Posted 01/06/2012 at 5:30 pm | Permalink |

              “But to answer your new question”

              I wasn’t asking a new question. My question has always been essentially “Why does anyone need 100Mbps now”.

              I have no problem that it is being offered but for those that do choose it (& I suspect you would be one to do so) what will it allow you to do that can’t be done on 25 or 50Mbps?

              • Posted 01/06/2012 at 6:00 pm | Permalink |

                “I have no problem that it is being offered but for those that do choose it (I suspect you would be one to do so) what will it allow you to do that can’t be done on 25 or 50Mbps?”

                Here’s an example Jacob- A family of 5, fairly average in general, 2 teenage sons and a daughter. A father who works partly away from the office and after hours, a mother who has her mother overseas and she’s also running a small, but successful home cooking business.

                All 5 are on Facebook- The daughter plays Farmville, the boys Mafia Wars (does anyone play that anymore??). The mother uses Skype several times a week to talk to her friends/mother/father. The father uses Skype for teleconferencing after hours and also remote connects to collaborate with people for work simultaneously. The 2 teenage sons enjoy playing Xbox Live after school and the daughter has just discovered Justin Bieber….god forbid.

                Now, not even taking into account catchup TV or, say, FetchTV over Broadband which several hundred thousand people use already as their normal TV watching medium, could you see how certainly 25Mbps and maybe even 50Mbps, depending on actual simultaneous usage of these things, could be a problem? For an extra $20 a month, why not remove the possible bottleneck?

                Remember dialup and all those arguments over who needed to use the phone compared to who was chatting online at the time? Same deal, only the father is yelling because he keeps having to wait 1 minute everytime he clicks a desktop icon at work because his sons are both playing Skyrim online and keep dying from lag, so they’re yelling, while his daughter is yelling that the video she’s watching keeps buffering, and would people get off the net. Meanwhile the mother is desperately trying to say hello to her Mothers best friend and talk to her about her mums health, but can’t even see her because Skype keeps cutting back the video size.

                As I’ve said before, there are plenty of people, myself included, who, at this stage, would be happy with 50Mbps. But there IS call in larger households ALREADY for 100Mbps. Just because you can’t see the need, doesn’t mean it isn’t there. And that’s just normal households. If you run a medium business from home, you’ve got call for it. Or if you have your own server systems, which more and more people do, to keep a whole extended family’s photos, videos, recipes, games etc AND IT support in one place. I know 2 people who have this. And I guarantee the doubling of the upload from 20 to 40Mbps on the 100Mbps plan, for the extra $20 odd a month, would be a small price to pay for them.

                I have no problem with people getting lower speeds because they don’t need the higher ones. But I’d just like to get people to be aware that there are people that want the top speeds already, for legitimate, or even frivolous, reasons. People are crying out for these speeds. The Coalition just isn’t listening….

                • Jacob
                  Posted 01/06/2012 at 8:06 pm | Permalink |

                  Thanks seven_tech for taking the time to reply.

                  It never actually dawned on me that 2 or more businesses may be run from home which would call for higher bandwidth. I suppose it really depends on the type of business being operated but how much bandwidth does a business need to run from home?

                  Let’s work through how much bandwidth this family might need at any one time.

                  Download
                  Xbox Live – 2Mbps x 2=4Mbps
                  FB games – 1Mbps x 3=3Mbps
                  HD Movie streaming – 5Mbps
                  HD Skype – 1.5Mbps
                  HD Conference call 5 people – 8Mbps
                  Catch-up TV services 2Mbps x 3=6Mbps
                  Total = 27.5Mbps + Business related download requirements

                  Upload
                  Xbox Live – 1Mbps x 2=2Mbps
                  FB Games – 0.5Mbps x 3=1.5Mbps
                  HD Movie Streaming – negligible
                  HD Skype – 1.5Mbps
                  HD conference call – 1.5Mbps
                  Catch-up TV – negligible
                  Total = 6.5Mbps + Business related upload requirements

                  • Posted 01/06/2012 at 8:29 pm | Permalink |

                    Not bad maths Jacob. But, there’s a few holes, in my opinion, for very near future developments:

                    - HD Movie Streaming- 5Mbps- What we have in Australia is NOT HD streaming. It’s 720p at best. Now, this argument is based on today, so that’s true right now, but I’d estimate in less than a year, driven much by the NBN itself, as it isn’t viable yet given the average throughput most of us get, we’ll see the first Australian content HD proper circa 8-10Mbps, appear. Also, I’d assume at some point, inevitably and unfortunately, we’ll see the collapse of Blockbuster/Video Ezy etc. Meaning a large jump in HD movie streaming a la Netflix, as per the US over the last 18 months

                    - Catchup TV- 2x 3Mbps- again, true right now. And again, give it, say, 2 years for this and we’ll see 720p, if not 1080p catchup. That’ll bump it to at least 2x6Mbps. And that doesn’t include the multicasting service that may bring BROADCAST TV across the NBN. Imagine the bandwidth load of 4 people watching individual full blown SD TV programs over broadband. That won’t happen for a few years yet, but it’s coming.

                    - Xbox Live- 2x2Mbps- Again, true current numbers. The next Gen Xbox in 2014/15?….I’d say we’re moving more and more towards cloud solutions, would you not agree? We might have full games processed online, integration with portable versions (like PSP and PS…4?) where you can pick up where you left off (Telstra are already looking at trials for this through T-Box). But apart from that, yes, your calculations include GAMING on Xbox….but what about actually DOWNLOADING the game, as is done more and more now? That might be, in the case of Skyrim, 12Gb with as high a throughput as you can manage. In this case higher throughput isn’t essential to productivity, but convenience. And we’re ALL about convenience as the lazy buggers we are :D

                    So yes, I’d say this year and probably up to the end of next year, 100Mbps may be a little frivolous for many. There will always be early adopters and tech heads and of course those with too much disposable income, but they will be <25% (even with these current rates we're seeing) But I'd say with the growth of the NBN we'll see DRAMATIC uptic in available products that suck down the bandwidth and by say, 2/3 of the way through rollout, I'd say there will be actual consumer need for it in some areas.However, and as this article points out, I think the likelihood is much higher of seeing MUCH larger AVERAGE rates, say in the vicinity of 45-50Mbps averaged out, rather than the ~26Mbps NBN is predicting by 2016, than many people will admit.

                    And this is the point; it's not so much about how many people are taking up the 100Mbps (although I still believe it will be popular) it's about the number that DON'T take up the budget 12Mbps, which NBNCo. is working on as the mainstay. I think this is VERY conservative and if it proves to be so, the NBN will be on even BETTER ground in terms of growth and legitimacy than it is now ( to those who AREN'T blinded by FUD of course). That's what's important :D

                    • Jacob
                      Posted 02/06/2012 at 6:35 pm | Permalink |

                      To seven_tech

                      Although I mostly overestimated as to how much each of these services use, I do take your point that in the future, many services will require more bandwidth to function efficiently and be more convenient. Cloud computing for example will, as you say, likely play a much greater role in peoples lives. People will start to expect catch-up and movie services to deliver 1080p content. More and more devices will become internet enabled requiring more bandwidth. I think we can agree on these points. Where our opinions differ I think is how soon this will occur. These things take time to not only be developed but also to reach mass adoption.

                      • Posted 02/06/2012 at 6:58 pm | Permalink |

                        I guess we’ll have to agree to disagree about 100Mbps applications Jacob :)
                        The applications already exist AND they’re being used in the US, Europe, Japan. We just don’t HAVE the speeds yet to use them. Once we do, the companies offering them will almost certainly takeoff in my opinion.

                        We’ll certainly see higher uptake than 12Mbps definitely.

                        Now we just have to convince the Coalition to continue the NBN if they get in….

                  • Alex
                    Posted 02/06/2012 at 11:35 am | Permalink |

                    Jacob, firstly you didn’t answer my question?

                    Secondly, you are asking for answers and when receiving, then arguing…it shows you aren’t really wanting an answer or another’s opinion, you just want the answer to fit your already unshakable belief and will argue along those lines, imo.

                    Surely even if you don’t need such speeds now, provisioning for the future as per my car/house analogy would be prudent, don’t you think?

                    But if you still doubt we will need those speeds, just go back ten years and think of what you were running and the speeds required back then. Did you think back then that you’d never need to upgrade ever again?

                    Well that’s what NBNCo is doing, making vast improvements for now and readying us for the future.

                    So to complete this going around in circles, let’s just surmise we won’t need those speeds….so put that sticking point to one side

                    * But we will still need the copper/HFC replaced/upgraded at some stage (you think Telstra and Optus will pay $b’s to do this)!

                    And replaced/upgraded just to allow us to keep what we have now or improve slightly (i.e. not ready us for the future, just keep the status quo).

                    * We need to provide for those who do not currently have – you believe private companies will invest in unprofitable areas, without being gifted a huge amount of our tax dollars? You believe in 2012, Aussie families should not have current technologies available to them or only have the choice of one retailing, gouging company?

                    * We still need something done about Telstra’s stranglehold over the nations comms.

                    * The list goes on and on…

                    Well…with NBNCo using investment dollars not income taxes, the NBN in one fell swoop, rights all of the above wrongs and of course will position us just in case you are wrong and the experts who say we will be needing NBN like speeds, are actually right…

                    So again I ask the unanswered question, what is the problem?

                    • Jacob
                      Posted 02/06/2012 at 6:20 pm | Permalink |

                      The reason why I didn’t answer your question is because it implies I have a problem with the NBN being capable of supplying customers with 100Mbps. I have never said this and in fact I support this capability.

                      In the article Mr Quigley says that if more people choose 100Mbps then prices would be cut due to increased revenue from these customers and the fixed return required by government. This made me genuinely interested as to how a 100Mbps connection would be utilized and how my household may benefit. Before I asked the question, in my opinion, today and in the short to medium term future, 100Mbps is unlikely to be required. With this in mind I suppose I interpreted the article as saying “you should choose 100Mbps because it’ll be cheaper for everyone than it is now” and to this I thought “even though many of us don’t need it yet”. There’s little point in spending more money per month on 100Mbps if you won’t fully utilize it, especially since you can easily upgrade later on when your requirements change.

      • Goresh
        Posted 31/05/2012 at 8:13 am | Permalink |

        I have a 100Mb/s hfc cable connection.
        Sadly, due to contention with my neighbours, the best I can get out of it is a singl 50Mb/s channel across the wifi. It is often much slower and I live in the burbs with my nearest neighbours a significant distance away.
        That is why, even when only surfing rather than doing serious work, you will see me sitting with my laptop connected to the wifi with a cable.

        Even with the cable directly connected, it is still pathetically slow on uplink and I go make coffee when I am uploading large files to work.

    11. alain
      Posted 29/05/2012 at 4:40 pm | Permalink |

      Of course the actual uptake figures and what speeds residences are taking has to be seen in the context that ALL plans at the moment are being heavily subsidised by the NBN Co.

      That allows one of the cheaper NBN ISP’s to offer 100Mbps for only $10 more than than 12 Mbps, so what the heck, I’ll take 100Mbps – thank you NBN Co.

      • Mike S
        Posted 29/05/2012 at 4:42 pm | Permalink |

        “so what the heck, I’ll take 100Mbps – thank you NBN Co.”

        Awesome, another one signing up to a 100/40 plan! Good to have you on board.

        • Geoff U
          Posted 29/05/2012 at 4:52 pm | Permalink |

          My parents-in-law have chosen 100/40 fibre on a Telstra bundle which will be installed in the coming weeks at their new house in a fibre-only (Greenfields) estate. Greenfields areas are a good indication for %-speed-take-up-distribution-rates because they don’t have any other choice for fixed-line connections. When NBN arrives at my place, I’ll take the fastest speed available at the time.

      • Dean
        Posted 29/05/2012 at 5:11 pm | Permalink |

        Oh yeah, I forgot in my prediction the “it’s heavily subsidized, unrealistic pricing” phrase.

        • Hubert Cumberdale
          Posted 29/05/2012 at 7:17 pm | Permalink |

          “artificially low” is my favorite :-)

      • Alex
        Posted 30/05/2012 at 10:25 pm | Permalink |

        The NBN critics complained early on about CVC prices, after Simon Hackett highlighted an anomaly which he believed would force smaller RSPs out.

        So NBNCo recognising the concerns, worked with them and did something about it.

        Now you’d think those who complained initially would be happy and have enough sense and decency to say, well done NBNCo, you listened.

        But no…

        Instead the same whingers (proving beyond doubt their one eyed partiality and agendas) typically whinge about the complete opposite, that NBNCo are now assisting the small players…

        *sigh*

        • Posted 30/05/2012 at 10:42 pm | Permalink |

          True Alex, but CVC pricing is still an issue because of the number of POI’s. The subsidising of the first 150Mbps on POI’s is a short term fix. It needs to be dealt with in the long term.

          • Alex
            Posted 31/05/2012 at 8:46 am | Permalink |

            Indeed which was the ACCC’s doing?

            • Posted 31/05/2012 at 9:25 am | Permalink |

              True, and its’ inconsistency on what is good for the consumer is annoying

    12. Douglas
      Posted 29/05/2012 at 4:54 pm | Permalink |

      NBN – Connecting Australia to a better future. You know it makes sense.
      Quit fighting it Alain!

    13. Reality Check
      Posted 29/05/2012 at 5:06 pm | Permalink |

      Regardless of the eventual composition of speed tiers taken up by the broader market, one thing doesn’t change — NBNco needs to hit that steady-state $60+ ARPU target.

      That target is predicated on widespread uptake of 100mbit or faster. This is where things start to get tricky due to the indirectly recursive nature of retail and wholesale pricing (because demand is price-sensitive).

      At present, various ISPs are already offering 100mbit plans. However, what’s crucial to note is that the current structure of retail prices is based on an assumption that most subscribers will select the slower tier plans. In the hypothetical scenario where 50% of NBN subscribers select 100mbit plans, these ISPs will have severely under-provisioned CVC capacity in terms of current operational planning.

      Hence, unless NBNco immediately lowers the CVC rate by a proportionate amount, the retail pricing of these 100mbit plans will shoot up dramatically. Demand for 100mbit plans will naturally drop due to the higher adjusted retail pricing.

      The problem here for NBNco is that their pricing strategy is predicated on the NBN hitting that $60 ARPU target by the time 100mbit plans become mainstream. It would be highly risky for NBNco to adjust the various wholesale charges downwards to such a degree that they are faced with a situation where i/ 100mbit plans are now mainstream and ii/ NBNco’s ARPU is still $33.

      The reason for this is obvious: the whole rationale of NBNco’s business plan is that “the average subscriber will in the future demand 100mbit and we’ll charge them $60 ARPU for it”. For NBNco to immediately allow 100mbit speeds to go mainstream at $33 ARPU would be to shoot themselves in the foot in terms of realising their business plan.

      • Mike S
        Posted 29/05/2012 at 5:11 pm | Permalink |

        Excuse my naivity, but where is the $60 figure coming from?

      • Posted 29/05/2012 at 5:25 pm | Permalink |

        What a pile of horseshit. NBN Co explicitly says it will cut pricing as it meets its targets sooner, and people immediately imply that not only is the company lying, but that they know the NBN’s economics better than NBN Co itself.

        We’re currently seeing 100Mbps plans as as low as $70 with 300GB of quota:

        http://delimiter.com.au/2012/02/14/exetel-reveals-300gb-100mbps-nbn-plan-for-70/

        Things aren’t going to change a lot from this scenario for the foreseeable future. If anything, they’re going ot get better.

        • Reality Check
          Posted 29/05/2012 at 7:18 pm | Permalink |

          <<<NBN Co explicitly says it will cut pricing as it meets its targets sooner,

          Yes, that is correct. What you have to bear in mind is that those ultimate "targets" are revenue targets.

          NBNco plans to drop AVC and CVC unit charges as take-up of the faster tiers increase. The reason why they can do so while at the same time generating higher revenue is because the faster tiers require greater CVC provisioning. While the unit pricing may indeed be falling, ISPs are actually spending more in total because they're purchasing more units.

          The crucial point here is the projected fall in AVC and CVC pricing is conditional on growth in revenue. And a huge portion of this revenue growth is driven by CVC provisioning for 100mbit plans.

          This covers the wholesale side of things. (And none of it is controversial as I’m just regurgitating NBNco’s business plan.)

          <<<We’re currently seeing 100Mbps plans as as low as $70 with 300GB of quota:
          http://delimiter.com.au/2012/02/14/exetel-reveals-300gb-100mbps-nbn-plan-for-70/
          Things aren’t going to change a lot from this scenario for the foreseeable future. If anything, they’re going ot get better.

          If you study the retail pricing structure of these ISPs' NBN plans, the first thing that hits you is there is minimal CVC provisioning, especially for the 100mbit plans.

          This is because the current retail pricing strategy assumes that most subscribers will choose the slower tiers. It also assumes that the relatively small quotas will be under-utilised across the board with the great mass of slower tiers "subsidising" the CVC requirements of the 100mbit tier to a degree.

          If, indeed, most NBN subscribers opt for 100mbit, then the ISPs will have to completely re-calibrate their CVC provisioning and retail pricing structure. At the end of the day, the fall in AVC and CVC unit pricing is conditional upon strong growth in CVC provisioning (total spend).

          Current 100mbit retail pricing is unsustainable because there is minimal CVC provisioning.

          Take Exetel: the average monthly charge of their 100mbit plans is $56.25.

          At present, with a median retail spend of $60 and $30 wholesale cost, the operating costs on the retail side alone are approx. $30.

          Subtracting $30 from $56.25 gives you $26 in wholesale charges. After factoring in port costs, there’s clearly very little CVC provisioning.

          Retail prices have to go up for NBNco to meet its CVC revenue targets.

          • Dean
            Posted 29/05/2012 at 8:00 pm | Permalink |

            Current 100mbit retail pricing is unsustainable because there is minimal CVC provisioning.

            Oh really? Which ISP do you run again?

          • Noddy
            Posted 29/05/2012 at 10:46 pm | Permalink |

            You just ooze shit. Over a certain number of customers CVC is almost wholly data allocation based.
            Nicely written. Congrats, you can polish a turd. I bet Exetel would love to make 50% profit on their plans like you seem to be implying. Not everyone can make Telstra profit levels. I am sure they happily enjoy 5-10%

          • Alex
            Posted 29/05/2012 at 11:08 pm | Permalink |

            To condense this so that you understand, I agree with Renai… what a pile of horse shit!

      • Goresh
        Posted 31/05/2012 at 8:18 am | Permalink |

        50% connections at 100Mb/s of 34% uptake of houses passed means they already meet their target for the 100mB/s rate without any more connections.
        Connection rates at the in-between rates is also higher than expected.

    14. Abel Adamski
      Posted 29/05/2012 at 5:13 pm | Permalink |

      I suspect a little more complex, don’t forget most of these connections are rural . They pay through the nose for their phone service and calls as well as their broadband. A comment on Znet from a poster Syd07, hooked his grandad up to Exetel, now with the VOIP pop is saving a packet on calls (Granparents and country people do like to keep in touch) So his total Comms spend has almost halved. Doesn’t take a genius to work out good value. Plus your gamers, geeks and early adopters. They are spending the same or a little under or over their current spend for the total comms package and use. Those seeking to cut costs 25/5 still gives good Skype, the matchers, the 100/40 may be close to their sweet spot

    15. Posted 29/05/2012 at 7:34 pm | Permalink |

      Having more people take up higher speeds does not necessarily translate to reduction in prices. More likely quite the opposite will occur. As it has been with all previous internet connections may it be dial-up, asdl, cable, 3G, 2G, profitably comes from light infrequent users that only use a portion of their full bandwidth and only a small percentage of their quota. These people in part subsidize the bandwidth and data hogs who use up all their quota and keeping on going if it cost them nothing more.

      Say an entry user on a 12/1 connection only use it for emails, and web surfing. Probably would use
      200kb/s max for short period and use 1gig of their 5gig connection each month. Say they pays $50 vs someone on 100/50 who pay only twice as much and that pushes 5mb/s downloads and 500kb/s uploads for extended periods and using up 120gig.. 20% over their max quota. Basically the extreme user used up 25X the download bandwidth, 50X the upload bandwidth and 120X the data but only pay 2X the cost of the average user. You would need quite a entry users to balance out the cost on parity as long as they are around it would be sustainable.

      Without the entry users who have no interest in jumping on the NBN, as the recently release has shown. The extreme users become a huge burden.

      The NBN would be unsustainable if every users wanted to use as much bandwidth as they could and do things like streaming 2 apple air 720P movies at once.

      If the trend continues the only solution is to increase the cost of faster plans and lower their quota. Then to encourage the entry users by lowering the cost of entry plans.

      • Dean
        Posted 29/05/2012 at 8:05 pm | Permalink |

        What makes you think everybody who’s signed up to the NBN so far is going to use their connection to the maximum possible?

      • Mathew
        Posted 29/05/2012 at 9:18 pm | Permalink |

        > The NBN would be unsustainable if every users wanted to use as much bandwidth as they could and do things like streaming 2 apple air 720P movies at once.

        Actually this is the point at which NBNCo starts swimming in cash, because RSPs will need to purchase more CVC at $20/Mbps. NBNCo’s plan is to drive revenue growth through CVC. The network is fully capable of handling this kind of traffic and necessary upgrades will be easily paid for by CVC revenue.

        NBNCo success hinges on two factors:
        - take up rates (which they won’t tell us)
        - data rates (where they are currently giving away 150Mbps free to each RSP – that is $3,000/month)

    16. Michael
      Posted 29/05/2012 at 7:35 pm | Permalink |

      I’m currently paying $110 / month for Telstra Ultimate Cable 100/2 Mbps, 500Gb quota on a 2 year plan.

      I’ll be looking for at 500Gb quota, 25/10Mbps would probably meet my actual current needs, but when NBN arrives in my street (currently planned to start in 3 years, let’s see what the coalition does) if it’s only an extra $10 / month I’ll go for 100Mbps plan.

    17. Posted 29/05/2012 at 8:35 pm | Permalink |

      I do love to see the arguments against such overwhelming evidence.

      Both Reality Check and bursting your bubble (remarkable similarities in names by the way…) have pointed out that the CVC pricing will not be sustainable if Australians continue to uptake 100Mbps plans. (almost word for word in fact…)

      To this I say one simple thing- Adaptation. This is early days and we may very well see the average speed drop to 50Mbps or even 25Mbps- that would STILL be better than NBNCo.’s assumption of the majority on 12Mbps for a start. And if they don’t drop? Adaptation- NBNCo. have the ability to adapt to the growing bandwidth requirement. Will it mean tweaking the CVC up slightly? Probably. This will artificially lower demand for higher speeds by putting retail prices up. But that is in the short term while the network is still being built and not yet able to handle all users at that level. Once the network starts offering 1Gbps and above and the technology to provide the lower speeds gets cheaper, as it always does, CVC pricing is likely to drop once again for 2 reasons:

      1) Uptake in business, on the 250, 500 and 1000Mbps plans will HUGELY add to the CVC average

      2) RSP’s will adapt if more bandwidth is required, buying relatively small amounts more CVC for what is STILL likely to be a relatively small amount of ACTUAL data flowing.

      Let’s face it, the best we can currently do in Australia is BitTorrent (which is artificially shaped by most ISP’s anyway for fear of overuse of data NOW), some poor quality catchup TV (your average iView viewing for an hour is less than 200Mb) and movies via Quickflix (SD) or, on Telstra cable, “HD” via T-Box, except it’s not ACTUALLY HD. It’s 720p, not 1080. We don’t HAVE any 1080 content really because we don’t yet have the speeds, ironically. Of course, these services will see a massive boost from the NBN and 1080p will be available in large quantities soon enough- the market provides for demand. But this will happen over several years, all the while NBNCo. and the RSP’s can adapt CVC and retail prices to ensure, even IF the uptake of higher tier plans is much higher than expected, the ARPU can remain high enough to maintain profitability.

      And don’t forget, we’re only just seeing the first products from NBNCo.- Broadband and Voice. Once they launch multicasting, improved guarantees of speed and Enterprise Business products, there will be more avenues for revenue.

      Reality Check and bursting your bubble- Business models work well for enterprise- this isn’t enterprise and NBNCo. can adapt much faster than enterprise can, for there’s much less fear about short term loss in revenue when you have only 350 basis points over government bonds to guarantee, rather than shareholders clambering for 10, 12 or 15% profit margins.

      alain- subsidising, again….really? I know I get bored of debunking it, but surely you have to be getting bored of saying it?

      And that, Ladies and Gentlemen, is once again more proof Australia is crying out for this network with loud, shouty voices!

    18. alain
      Posted 29/05/2012 at 8:57 pm | Permalink |

      ‘alain- subsidising, again….really? I know I get bored of debunking it, but surely you have to be getting bored of saying it?’

      Where have have you debunked it, how can you debunk something that is fact?

      ‘On top of the basic NBN access charge per user starting at $24 per month, retail service providers (RSPs) also have to pay a connectivity virtual circuit charge, which secures bandwidth to a consumer from the point of interconnect (PoI). This is charged at $20 per 1Mbps’.

      Today, NBN Co announced that the company would rebate this charge while the network was rolling out for the first 150Mbps per month at each point of interconnect until that particular PoI had passed 30,000 premises. Each of the 121 PoIs will service between 50,000 and 162,000 premises.’

      I repeat the current wholesale ISP NBN pricing is being subsidised by the NBN Co.

      • Mathew
        Posted 29/05/2012 at 9:09 pm | Permalink |

        The NBNCo Corporate Plan makes it very clear that ARPU needs to rise for NBNCo to meet it’s targets. Some has calculated that it needs to double from $33-34 to over $60.

        Prices for the same service will (almost certainly) decline, but at a rate significantly less than the uptake of faster services / downloading more.

        Plans for AVC pricing are outlined on page 101 of the NBNCo Corporate Plan:
        * 1000/400Mbps falls from $150 to $90, while the average speed grows from 30Mbps to 230Mbps.
        * Price falls by 40% while average speed grows by 760%

        Plans for CVC pricing are outlined on page 103:
        * Starts at $20Mbps/Month when the average data usage is 30GB/Month and falls to $8Mbps/Month when the average data usage is 540GB/month.
        * Price falls by 2.5 times, while the average data usage grows by 18 times = growth in revenue from CVC of 720% when accounting for price falls.

        • Noddy
          Posted 29/05/2012 at 10:50 pm | Permalink |

          Dejay vu, I have this feeling I have seen this same post 500000 times before.

      • Mike S
        Posted 30/05/2012 at 8:53 am | Permalink |

        Is it possible that the plans that are being currently offered are in fact what they look to have customers pay after this subsidisation is removed, so currently they are making more profit per customer? Simply, is this a possible event at this time?

    19. Mathew
      Posted 29/05/2012 at 9:07 pm | Permalink |

      Quoting from the Senate Estimates Committee Hearing on take-up: “Three months later we now have approximately 11,000 active connections across all three technologies” and a bit later “We now have over 7,300 active services on the interim satellite.” followed by “I am also pleased to report that our fixed wireless service is now up and running. We recently completed testing and now have 52 active connections as part of a trial in Armidale.”

      Now 3,700 self selecting premises on fibre would hardly be considered representative of the a 12 million premises roll-out. If the 34% figure was an average across all sites, then there would be ~10882 premises passed, yet we know in NBNCo’s six monthly report to end of December 2011 (published in April) that on 16-March-2012 there were 18,200 premises that could order connections. At best that gives 18%, but it would be reasonable to assume that more premises have been available to order connections since then.

      Unfortunately Quigley is generating just as much spin as Gillard and Swan on the NBN. It is a shame that the Liberals don’t understand enough to ask the right questions, like:
      * How many premises can order fibre today?
      * What is the take-up rate across the nation?
      * What is the lowest take-up at a POI?

      • Posted 29/05/2012 at 9:28 pm | Permalink |

        “Unfortunately Quigley is generating just as much spin as Gillard and Swan on the NBN”

        Sorry, I don’t agree with this. Unlike 99% of commenters here, I have met Quigley on a number of occasions and always found him very transparent and trustworthy. I recommend you read this article if you don’t believe me:

        http://delimiter.com.au/2011/05/17/in-defence-of-an-honourable-man/

        • Mathew
          Posted 30/05/2012 at 9:21 am | Permalink |

          > Sorry, I don’t agree with this. Unlike 99% of commenters here, I have met Quigley on a number of occasions and always found him very transparent and trustworthy.

          If he is attempting to be as transparent as possible, then why are NBNCo only releasing figures that put a positive spin on the project and not providing actual figures on take-up?

          It’s very clear that the majority haven’t ready page 77 of the NBNCo Corporate Plan where the lowest take-up is above 40% and only 3 years are predicted to lower than 60%.

          • Posted 30/05/2012 at 9:54 am | Permalink |

            As I wrote elsewhere in this thread:

            You’re wrong. Page 77 of the corporate plan does not even cover take-up rate, it refers to the deployment schedule. Either you are lying or simply mistaken.

            • Mathew
              Posted 31/05/2012 at 7:45 pm | Permalink |

              > You’re wrong. Page 77 of the corporate plan does not even cover take-up rate, it refers to the deployment schedule. Either you are lying or simply mistaken.

              Renai, based on my detailed response in and seven_tech’s response are you prepared to reconsider the meaning of the table on page 77?

              If I am mistaken, could you provide some commentary on why you think this is case.

          • Reality Check
            Posted 30/05/2012 at 12:51 pm | Permalink |

            Mathew, you are correct.

            Reading the first paragraph below the table on p. 110, NBNco appears to define “premises connected” as “activated premises”. Also, the term “connected premises” is used in the same meaning of “activated” in Exhibit 9.10 on p. 116.

            Can you paste me a link to the quarterly report you cite (for the services “available for order” figure)?

            Thanks.

            • seven_tech
              Posted 30/05/2012 at 1:03 pm | Permalink |

              “Reading the first paragraph below the table on p. 110, NBNco appears to define “premises connected” as “activated premises”. Also, the term “connected premises” is used in the same meaning of “activated” in Exhibit 9.10 on p. 116.”

              Indeed, it appears you are correct. I retract my statement about projected take up rates.

              However, this Corporate Plan is the basis of the NBN, done when many agreements were still to be made, including the Telstra agreement which was delayed by over 6 months. It’s basis remains, but its’ predictions are likely to change in the coming Corporate Plan. These are the numbers we had to go off until now. NBNCo. believe they’re broadly on target. Many ISP’s including iinet, who originally criticised the rollout as being unattainable in its’ speed and scale. I have no reason to disbelieve them. If you do, I accept that, but your claim has no valid merit compared to mine, or vice versa.

              These comments like “this is a load of rubbish”, bear no merit. You cannot substantiate your claims. We are at least working with the numbers we’ve been officially given.

      • Dan
        Posted 29/05/2012 at 9:44 pm | Permalink |

        Gee Matthew, we were all wondering when you would show up.

        Perhaps, and this is just an assumption, but I reckon that in that 18% of premises passed (which you claim is a “good assumption”) – Of those that are contractually able to switch immediately to NBN, almost all have.

        What? In English you say? Of the whopping 25% of people who have braodband (OECD Broadband penetration rate for Australia), only 18% of elegible premises passed have switched to the NBN; a mere 72% market share.

        Now I wonder how many of the 28% remaining are in the middle of a 24 month contract, especially in Tasmania where Telstra did a bit of a blitz on re-contracting everyone just before the NBN rolled through. Either way, If I could sell a product and get 72% market share in less than a year I’d be pretty darn happy.

        As for your remark about sample sizes… The current sample (of 3700) is VALID within statistical margins (of 3%) and 3.5 times more than any Newspoll conducted on “Who’s your preferred Prime Minister”, which incidentally today saw Jooolia beat your boyfriend by 1%

        • Hubert Cumberdale
          Posted 29/05/2012 at 10:17 pm | Permalink |

          “Gee Matthew, we were all wondering when you would show up.”

          He needed time to rethink his FUD routines after been utterly destroyed by the latest NBN developments… sadly the new ones are not working either :-(

        • Posted 29/05/2012 at 10:39 pm | Permalink |

          Mmmm, Dan, while I appreciate your fervour, that’s a little misleading.

          Yes, the OECD report shows a penetration rate of ~25% overall of broadband/cable in Australia (which is quite low, mainly because it is based on PEOPLE, not premises- a family of 6 may only have 1 net connection), but to say that because 18% of premises passed have taken the NBN equates to a 72% real-world uptake is….a bit of a stretch.

          Yes, the sample size is statistically viable and while I appreciate the humor behind Newspolls being significantly lower in sample size, they’re also across the entire population. This isn’t. It is across several key areas, yes, but it is yet to include vast tracts of high density areas and also many regional hubs. It does give a good indication statistically, but, as we also know, 37% of statistics are made up….:D

          That isn’t to say we can’t take anything away from this. It is obvious, particularly in rural and regional areas people are clamouring to have faster broadband and, in fact, faster than many predicted. This is, no question, good news for the NBN. I’d be careful to throw around numbers at this stage though. But 6 monthly predictions from now? Maybe. 12 months, almost definitely. The larger the sample, across the larger the scope, the more likely these guys will have no leg to stand on in their “Australia doesn’t want this much faster broadband”

          My guess, and this is educated only, no proof, so please indulge me briefly, would be to see the average Mbps level once more than 50% of rollout has been completed, at about 35-40Mbps. ie much higher than NBN are predicting, at about 20Mbps around then, but lower than what we’re seeing currently. And by then end, closer to 60Mbps, maybe slightly higher. Again, considerably higher than NBN are predicting.

          However, I will say, Matthew, your comment, that Dan has rebutted quite succinctly, about the average ARPU being lower than forecast-??….come on, really? Direct quote here:

          “- data rates (where they are currently giving away 150Mbps free to each RSP – that is $3,000/month)”

          That’s why. This won’t be ongoing and once it stops, the ARPU will rise dramatically. This is incentive for the NBN while it is small. Please try and give some consistency to your arguments

          • Dan
            Posted 30/05/2012 at 10:12 am | Permalink |

            Well roll it this way if you think its a stretch too far

            5.5m fixed line broadband subs in Aus (in 2010, last ABS report, of which the vast majority are ADSL2)
            say 11m premises to make it easy.
            50% of premises have broadband.

            11m mobile broadband subs in Aus
            again, 22m people to make it easy.
            50% of people have mobile broadband.

            Swing those two any way you want but the fact remains that you will never be able to tell me exactly how many people or premises have a broadband connection as there are so many overlaps – e.g. in our house we have ADSL2 and 4 mobile voice+BB subs, plus we all get to share the internet at our places of work/study – so we just use the numbers presented as they are, thus I used 25% penetration.

            Now we all know the real question that should have been put to NBN Co. was “Of the houses that do have broadband in NBN fibre cabled areas, what percentage are on that fibre?” You can only guess, but I can’t imagine it being any lower than 50%.

            Its just a numbers game at this stage, but trying to claim that only 18% of people are bothered to use NBN is just pure horseshit.

            • seven_tech
              Posted 30/05/2012 at 10:30 am | Permalink |

              That’s a fair enough analysis Dan. I’d agree it’s almost impossible to separate subscription from premises etc.

              It is DEFINITELY horseshit to say the uptake is only 18%. It is clearly not. But Matthew enjoys finding comfort in the worst numbers he can find. Hence his miscalculation in assuming “page 77″ shows that the take up rate in 2013 is forecast as 40%, whereas that is actually the connected premises, not the take up rate…..

              I’ve got no problem with the numbers coming from NBNCo. I just think, in this political climate, we need to be careful how extreme we make our claims, even if they ARE viable, because the politics will almost CERTAINLY bite us if we make outlandish claims and they’re proven to be not quite true.

              I guess what I’m saying is we need to err on the side of caution, because currently, it’s the Coalition who are smelling like a dung heap from all their FUD and falsities on the NBN numbers. We don’t want to be accused of taking it the other way.

        • alain
          Posted 30/05/2012 at 10:04 am | Permalink |

          @Dan

          ‘Now I wonder how many of the 28% remaining are in the middle of a 24 month contract, especially in Tasmania where Telstra did a bit of a blitz on re-contracting everyone just before the NBN rolled through. ‘

          That is just conjecture, this a evidence based forum.

          • Dan
            Posted 30/05/2012 at 10:31 am | Permalink |

            Apologies Alain; I’ll be sure to put in my political butt-covering words like “allegedly” next time.

            Of course the alleged door-to-door blitz by Telstra wasn’t covered by any media outlet, but it was mentioned within many comments attached to news articles at the time NBN was just starting to move through Tassie. So sure, you are right, so it is only heresay.

            Either way, the point I was trying to make is that you cannot assume all possible broadband subscribers are able to switch immediately (to the NBN) as many are stuck with either 24 month contracts or “bundle” deals that may have punitive break fees.

            • seven_tech
              Posted 30/05/2012 at 10:34 am | Permalink |

              alain, we are evidence based, as is pointed out to you and you seem to keep pointing out to us when it suits.

              But the sentence “Now I wonder how many…”, under any normal reading indicates that Dan was trying to say, in his OPINION this may be a factor. He did not say it was fact or give hard numbers, he was simply postulating, and there is nothing wrong with that as long as it’s not presented as fact, which it wasn’t.

              Pull your head out of the sand about things you don’t want to here and engage, rather than pedalling the same rhetoric.

              • alain
                Posted 30/05/2012 at 1:06 pm | Permalink |

                I have often seen the ‘they are under Telstra contract’ used many times as to why take-up rates are not better, until someone provides actual statistical evidence that this is what is stopping residences signing up to NBN plans in such numbers it is statistically significant it remains in the conjecture basket.

                I could quite easily state with the same conviction in that case that Telstra (BigPond) contracts are NOT a statistically significant reason for residences not signing up to a NBN Plan.

                • seven_tech
                  Posted 30/05/2012 at 1:13 pm | Permalink |

                  “…until someone provides actual statistical evidence that this is what is stopping residences signing up to NBN plans in such numbers it is statistically significant it remains in the conjecture basket.”

                  This following reference is older than I’d like, but still relevant. It is an independent online survey done by Whirlpool. Almost 18000 people did it, so it’s a representative sample:

                  http://whirlpool.net.au/survey/2007/

                  Look about 1/3 of the way down at: “How long was the contract period you agreed to when signing up?”

                  Telstra Cable, Telstra DSL- combined % of 69% of those on Telstra broadband have contracts between 18 and 24 months

                  And you were saying about conjecture?

                  • alain
                    Posted 30/05/2012 at 1:24 pm | Permalink |

                    How do you know all those WP respondents have the NBN running past their door in one of the few activated areas in Australia and stated no to a NBN ISP plan because they are on a BigPond contract?

                    • seven_tech
                      Posted 30/05/2012 at 1:29 pm | Permalink |

                      Oh for GOODNESS sake alain. We’re working on available numbers here.

                      You’re right, no one has done a survey of the JUST people who have access to the NBN and whether or not they are still on contract and therefore can’t, even if they did want to, connect to the NBN. No one is LIKELY to do that survey. ALL we have to go on is surveys of the general population and the general population says, if they’re with Telstra, 69% sign up to 18-24 Month contracts.

                      This is a MUCH larger representative sample than those who are even on the NBN and that sample is STILL statistically relevant. The fact is, unless the EXACT number you are after is confirmed by multiple sources, preferably towards your argument, you will not believe it. There is nothing I can do to change that. But would you please stop asking for things you know full well no one has, including you.

                      • Dean
                        Posted 30/05/2012 at 3:00 pm | Permalink |

                        But would you please stop asking for things you know full well no one has, including you.

                        You must be new here. This is a standard tactic and when you admit that it doesn’t exist, he’ll take that as evidence that he was right all along and you were wrong. It’s generally not fruitful arguing with fundamentalists, because they have no interest in actual facts, just pushing an agenda.

                      • Geoff U
                        Posted 30/05/2012 at 3:04 pm | Permalink |

                        Given that the survey was done in 2007, even if someone had signed up a contract the day before the survey, a 24-month contract would have expired in 2009 at the latest.

                        We might make a guess and say that those people renewed their 24 month contracts in 2009 thereby putting them in 2009-2011 contracts.
                        If they renewed again, that puts them in 2011-2013 contracts, so they probably would be in the middle of a 24-month contract right now.

                        Just for kicks, I went in search of further evidence.

                        The question was also asked in the 2003, 2004, 2005, 2006, 2007 and 2008 broadband surveys:
                        http://whirlpool.net.au/survey/2003/
                        http://whirlpool.net.au/survey/2004/
                        http://whirlpool.net.au/survey/2005/
                        http://whirlpool.net.au/survey/2006/
                        http://whirlpool.net.au/survey/2007/
                        http://whirlpool.net.au/survey/2008/

                        To use the same examples, let’s compare with a summary:

                        % with 19-24 month contracts:
                        2003 Telstra Cable – 4.8%
                        2003 Telstra DSL – 4.1%
                        2003 Telstra Average – (4.8+4.1)/2 = 4.45%

                        2004 Telstra Average – 31.6% (the data wasn’t broken up into Cable/DSL for 2004)

                        2005 Telstra Cable – 50.2%
                        2005 Telstra DSL – 49.6%
                        2005 Telstra Average – (50.2+49.6)/2 = 49.9%

                        2006 Telstra Cable – 49.3%
                        2006 Telstra DSL – 62.9%
                        2006 Telstra Average – (49.3+62.9)/2 = 56.1%

                        2007 Telstra Cable – 65.6%
                        2007 Telstra DSL – 73.8%
                        2007 Telstra Average – (65.6+73.8)/2 = 69.7%

                        2008 Telstra Cable – 62.9%
                        2008 Telstra DSL – 75.4%
                        2008 Telstra Average – (62.9+75.4)/2 = 69.15%

                        The average % of Telstra customers with 19-24 month contracts increased every consecutive year until 2008 where it took a 0.55% drop from 2007 to 2008.
                        Even with the slight drop, nearly 7 out of every 10 of Telstra’s customers who were surveyed were on 19-24 month contracts for two years running
                        Also the majority (>50%) of Telstra’s customers who were surveyed were on 19-24 month contracts for three years running – and almost a fourth year with the 2005 average missing 50% by only 0.01%.

                        Given that the question wasn’t asked in the surveys since 2008, it is difficult to speculate on what the current stats might be.

                        Based on past evidence, however, it is highly plausible so suggest that the majority of Telstra customers in this survey have still been signing up for 19-24 month contracts and, if so, there are a significant number of them who may be, in fact, still in 24 month contracts right now.

                        I would also guess that the preferred option for most people would be to not pay for two concurrent internet services. Therefore, those people are restricted from taking up a new NBN service contract without breaking existing contracts and incurring cancellation fees.

                        We also haven’t taken into account those who are locked into a multi-monthly contract of any kind, 6, 12 or 18 months, for example. These people would also incur cancellation fees if they attempted to break contract and, therefore, are also restricted from taking up a new NBN service contract without paying for two concurrent internet services.

                      • alain
                        Posted 30/05/2012 at 6:09 pm | Permalink |

                        ‘You’re right, no one has done a survey of the JUST people who have access to the NBN and whether or not they are still on contract and therefore can’t, ‘

                        So any statement asserting otherwise is just total conjecture, good glad we got that sorted.

                      • Alex
                        Posted 30/05/2012 at 6:16 pm | Permalink |

                        Where is YOUR survey to prove people ARE NOT on contract.

                        Oh you don’t have one?

                        So any statement asserting otherwise is just total conjecture, good glad we got that sorted.

    20. Mathew
      Posted 29/05/2012 at 9:14 pm | Permalink |

      Quoting from the Senate Estimates Committee Hearing on ARPU, Quigley said “We do not split this out but I can tell you that as of the end of March the average revenue per user was $29.55.”

      Now the NBNCo Corporate Plan forecast ARPU at $33-34 (page 110-111). AVC for a 12/1Mbps is $24 and 100/40Mbps is $38. Why is the ARPU lower than forecast when speed take-up is significantly higher than forecast?

      • Dan
        Posted 29/05/2012 at 9:48 pm | Permalink |

        “Why is the ARPU lower than forecast when speed take-up is significantly higher than forecast?”

        NBN are not charging any CVC at the moment. You know that; you told us back in a post last time about how no ISP was currently paying for it so it “artificially lowered the retail prices” when you were arguing that prices would not be chepaer under the NBN.

        You sir are an idiot

        • Mathew
          Posted 30/05/2012 at 8:04 pm | Permalink |

          > NBN are not charging any CVC at the moment. You know that; you told us back in a post last time about how no ISP was currently paying for it so it “artificially lowered the retail prices” when you were arguing that prices would not be chepaer under the NBN.

          Thanks for pointing out the CVC, although my understanding is that is only first 150Mbps that is free and after that RSPs have to pay. Based on Internode’s experiences in Tasmania, I would anticipate that quality RSPs would be purchasing at least 50Mbps especially with the higher rates of sign up for faster speeds.

          I wonder if RSPs are using the free CVC to discount plans by 20-25% in the hope of growing market share?

    21. Gordon Drennan
      Posted 29/05/2012 at 10:32 pm | Permalink |

      This article isn’t “analysis”, it is “spin”. It is manipulating numbers to make bad news look like good news. It sounds good to say a bigger percentage than expected of those who’ve signed up have signed up for the highest speeds, but in fact its a bigger percentage of a far smaller than expected percentage of people who have signed up at all. So the reality is not that they’ve got more people signed up to high speed than they expected, but that they’ve got fewer people signed up to low speed than they expected. And they are trying to hide that. The people they are getting signed up as customers are people who are willing to pay for ultra-high speed. The majority of people are going “ho-hum I can get the speed I need elsewhere cheaper” and ignoring the expensive fibre-optic cable going down their street. NBNCo’s income isn’t higher than they planned, but lower. And if they don’t accept the reality of that, and admit it, and adjust their plans accordingly, in a few years their chickens are going to come how to roost and the NBN will be in serious financial trouble.

      • Posted 29/05/2012 at 10:42 pm | Permalink |

        hey Gordon,

        in actual fact, your comment is incorrect. NBN Co are getting a higher sign-up rate than they had planned for, and amongst those that have signed up, more people are signing up for higher speed plans than NBN Co had planned for. This is fact.

        Cheers,

        Renai

        • Posted 29/05/2012 at 10:57 pm | Permalink |

          Gotta say Gordan, I’m going with Renai here. You’ve given us no relevant information to indicate the sign up rate is lower than NBNCo. expected at this (VERY) early stage.

          As Renai has stated before here, this is an evidence based forum. You’re entitled to ask evidence of anyone here to back their argument, and we expect you to give us some if we ask.

          We’re asking. Where is your evidence for lower take up rate than expected? Take up rates are predicted to peak at 70% in 2025. There is no clear indication that the take up rates we’re seeing now, including all relevant issues such as geography, density, technological interest, contracts with other ISP’s, awareness and many others, are significantly lower than internal NBNCo. forecasts, which are likely to be reflected in teh new Corporate Plan.

          It is not reasonable, nor sensible nor logical to consider the final take up rate as being the take up rate on average, ESPECIALLY with a network not even 1 year old.

          • Alex
            Posted 29/05/2012 at 11:17 pm | Permalink |

            C’mon seven_tech, it’s just a continuation of the old tired, “white elephant”, “we can’t afford”, “waste”.

            And when we ask ok, why do you claims this, the answer is of course, umm, just because!

      • Hubert Cumberdale
        Posted 29/05/2012 at 11:06 pm | Permalink |

        “The people they are getting signed up as customers are people who are willing to pay for ultra-high speed.”

        How do you explain the 13% that signed up for the slowest 12/1mbps plan then? (btw 1gbps is “ultra-high speed” and those plans are not available yet)

        “The majority of people are going “ho-hum I can get the speed I need elsewhere cheaper” and ignoring the expensive fibre-optic cable going down their street.”

        You do realise that the rotted and redundant copper will finally be ripped up and put to good use elsewhere. It’s no problem though, people will realise soon enough that they can get a better deal on NBN anyway despite your erroneous claims… and no wireless doesn’t cut it I’m afraid.

        “the NBN will be in serious financial trouble.”

        LOL

    22. Posted 29/05/2012 at 10:43 pm | Permalink |

      “… If the 34% figure was an average across all sites, then there would be ~10882 premises passed…”

      Matthew, you’re not reading the articles. This 38% (NOT 34%) was NOT across all sites, it was only across fibre. You’re skewing your numbers to look better.

      • Mathew
        Posted 30/05/2012 at 9:34 am | Permalink |

        > Matthew, you’re not reading the articles. This 38% (NOT 34%) was NOT across all sites, it was only across fibre. You’re skewing your numbers to look better.

        Actually 38% would make the numbers worse.
        * 3,700 premises connected
        * 3,700 / 38% = 9,736 premises where a fibre service can be ordered
        * 9,736 is roughly half of 18,200 premises where fibre can be ordered as of 16-Mar-2012 (NBNCo report – December 2011)
        * 3700 / 18,200 = 18%

        Compare that with the expected take-up rates on page 77 of the NBNCo Corporate Plan.

        • Posted 30/05/2012 at 9:53 am | Permalink |

          You’re wrong. Page 77 of the corporate plan does not even cover take-up rate, it refers to the deployment schedule. Either you are lying or simply mistaken.

          • seven_tech
            Posted 30/05/2012 at 10:31 am | Permalink |

            Thankyou Renai, you beat me to it. This “page 77″ is about total connected premises, not take up rate.

            Also Matthew- We’re in 2012 and at 34% (I realise you don’t accept this number, but everyone else seems to) and if it WAS to be projected to be 40% in 2013, I think we’re on our way pretty well….

            • Mathew
              Posted 30/05/2012 at 1:26 pm | Permalink |

              > Also Matthew- We’re in 2012 and at 34% (I realise you don’t accept this number, but everyone else seems to) and if it WAS to be projected to be 40% in 2013, I think we’re on our way pretty well….

              I’d be happy to accept the number if it added up. I’ve explained why the numbers don’t add up in my post above and nobody has demonstrated the error in the calculations.

              I would argue at the moment one of the greatest risks to the NBN is spin. It is highly likely that the government will change next year. At that point there will be a review of the NBN and if the reality is different to the spin then the Liberals will feel justified in canning the project as ‘out of control’ or ‘unachievable’ in the same way OPEL was binned by Labor. If the numbers tally, then it will be much harder to cancel.

              • seven_tech
                Posted 30/05/2012 at 1:32 pm | Permalink |

                “At that point there will be a review of the NBN and if the reality is different to the spin then the Liberals will feel justified in canning the project as ‘out of control’ or ‘unachievable’ in the same way OPEL was binned by Labor. If the numbers tally, then it will be much harder to cancel.”

                So, if the numbers are down on what they should be, if the Coalition were to get in, you would condone cancelling the entire project wherever it stands, wasting up to $15 Billion in the process and starting the whole consultation process from scratch?

                And how is this good policy?

    23. Posted 29/05/2012 at 10:45 pm | Permalink |

      “The NBNCo Corporate Plan makes it very clear that ARPU needs to rise for NBNCo to meet it’s targets. Some has calculated that it needs to double from $33-34 to over $60.

      Prices for the same service will (almost certainly) decline, but at a rate significantly less than the uptake of faster services / downloading more….”

      4th times I’ve seen this EXACT post. And it’s still not relevant here. In fact it’s LESS relevant here with the numbers Quigley is reporting….

      • Noddy
        Posted 29/05/2012 at 10:56 pm | Permalink |

        Only 4 times? You lucky lucky bastard. I could recite the bloody thing in my sleep.

      • Hubert Cumberdale
        Posted 29/05/2012 at 11:09 pm | Permalink |

        “And it’s still not relevant here”

        You must be new :-)

    24. Mat_L
      Posted 29/05/2012 at 11:37 pm | Permalink |

      It should not be a supprise that people are signing up to the highest plan. Just looking at Telstra, Optus, iinet,Extel & Internode there in total 64 different plans offer with only 9 for 12 mbps, 23 for 25 mbps, 12 for 50 mbps and 20 for 100 mbps.
      Who in their right mind would sign up to 12 mbps where the highest per GB cost is $1.66 (not taking into account the bundles offering) for a monthly allocation of 30GB, where for $0.20/GB more you get the same at at 25Mbps, both are internode plan and for $0.04 less you can have 40GB at 50mbps.
      Just looking at iinet
      25 5GB 1000 84.95 0.08495
      25 5GB 100 64.95 0.6495
      25 5GB 40 54.95 1.37375

      25 1000GB 84.95/month 0.08495/GB iinet
      50 1000GB 94.95/month 0.09495/GB iinet
      100 1000GB 99.95/month 0.09995/GB iinet

      • seven_tech
        Posted 30/05/2012 at 7:44 am | Permalink |

        You’re analysis of the per Gb cost is great Mat_L. And it certainly explains why people would have incentive to go to higher plans- which is exactly the point. NBNCo. have been pushing high plans from the start, it is part of their Corporate Plan to ensure high ARPU and increasing CVC revenues.

        But, I think it’s unlikely most people will look quite that in depth into all the plans. It’s more likely, they’re seeing the higher plans for not much more, and simply thinking higher is better, and going with that. Particularly if their in regional/rural areas that’ve been stuck on ISDN or worse, dial up….

        The high take up of higher tiers doesn’t surprise me in the slightest. I’ve always believed NBNCo.’s projections have been on the conservative side. But they have to be. In this political climate, if they’re conservative and then shown to be so, it is positive for NBNCo. in the political sphere and automatically defends their position. It’s all about the politics….and I hate that.

    25. Abel Adamski
      Posted 30/05/2012 at 1:39 am | Permalink |

      http://www.zdnet.com.au/rural-councils-playing-chicken-with-nbn-co-339338732.htm

    26. Abel Adamski
      Posted 30/05/2012 at 9:31 am | Permalink |

      The Coalition slipped up badly, they in fact have demonstrated an abject failure to understand the needs of the business sector, the economy and the the people, especially the rural sector. It does place a question mark on their vaunted superior economic management capabilities.

      They if they could have grasped the actual importance and did their job as elected representatives, given support but pushed for improved fibre coverage in the rural areas, possibly pushing the local community involvement line with their favourite subsidies and pork barrelling. They could push a role for the Greenfield developers such as Opticom in this area. Could have been a win win

      • alain
        Posted 30/05/2012 at 10:22 am | Permalink |

        You talk as if the 2013 election has been held already, the Coalition lost and it’s analysis time in Delimiter as to the reasons why they lost.

        The Coalition have heaps of time to fine tune a policy, and after all they could follow Labor’s lead of policy on the run, go into the election with one policy and change it totally after they have been elected.

        Interestingly enough if a snap election was held this weekend the Coalition would win easily without any change to what they have already stated what their Communications policy would be.

        • Abel Adamski
          Posted 30/05/2012 at 11:09 am | Permalink |

          Alain
          Au Contraire
          Did you read the article.?
          http://www.zdnet.com.au/rural-councils-playing-chicken-with-nbn-co-339338732.htm
          Have you kept abreast of the enthusiasm of the business sector and the Telco’s?
          My point was that the subject of National Broadband has been on the agenda for many years and has been a factor in the Coalitions defeat in two elections. Yet the Coalition has failed to grasp the relevant factors after all those years. It is a concern, they should have put petty politics and ego’s aside for a matter this important to the National economy both for now and decades to come.

          • alain
            Posted 30/05/2012 at 6:15 pm | Permalink |

            ‘My point was that the subject of National Broadband has been on the agenda for many years and has been a factor in the Coalitions defeat in two elections.’

            Once again that is conjecture, especially as the first election Labor won from Howard in 2007 did not have the current NBN FTTH Plan as their election policy at all.

            • Alex
              Posted 30/05/2012 at 6:22 pm | Permalink |

              Well you may not think so, but the Libs seems to…

              http://www.afr.com/p/opinion/libs_retreat_on_nbn_battleground_TOnH1LHLrE40j2vcJ4AAQM

              ***

              “Take the national broadband network, a policy area that the Coalition itself believes may have cost it the 2010 election.

              The review of the Coalition’s 2010 campaign by Peter Reith quoted Menzies Research Centre head Julian Leeser as saying that “the failure to properly explain the Liberal Party’s broadband policy and the Labor Party’s effective scare campaign was a major cause of the party’s failure to win seats in Tasmania.

              “Policy on the national broadband network had a particular effect in Tasmania for a range of reasons,” Leeser wrote.

              “In several towns, Tasmanians could see the NBN being rolled out . . . the NBN provided jobs for Tasmanian contractors and it brought people to Tasmania from the mainland, having flow-on effects for Tasmania’s tourism, hospitality and service industries.”

              Reith observed that “post-election polling confirmed the NBN was a major reinforcement for people to vote Labor in Bass” .

              Given the tight result, the Coalition winning Bass and another Labor seat in Tasmania, Braddon, would have been the difference between government and opposition. Presumably, the NBN also had an effect in other seats”.

              • Alex
                Posted 30/05/2012 at 6:33 pm | Permalink |

                Ooh and alain…

                Inadvertently there’s another of your previous questions “answered by the Libs…”. So you can’t this time say, conjecture, NBN Zealots, Labor shills or whatever, this is review from Peter Reith (former Deputy Leader of the Liberal Party and former Treasurer under JWH iirc) via Tim Leeser of the Menzies Research Centre”…

                Got that?

                And look these “Liberal Party movers and shakers even admit to all of these NBN benefits”… people going to Tas from the mainland, job creation, and flow-ons from tourism, hospitality etc…

                ***

                “Policy on the national broadband network had a particular effect in Tasmania for a range of reasons,” Leeser wrote.

                “In several towns, Tasmanians could see the NBN being rolled out . . . the NBN provided jobs for Tasmanian contractors and it brought people to Tasmania from the mainland, having flow-on effects for Tasmania’s tourism, hospitality and service industries.”

            • Posted 30/05/2012 at 6:22 pm | Permalink |

              “Once again that is conjecture, especially as the first election Labor won from Howard in 2007 did not have the current NBN FTTH Plan as their election policy at all.”

              Might very well be conjecture for the 2007 election. Not the 2010 one. The Liberals little blue book of failure told them all about how they screwed up broadband in that election. And they’re doing the same thing now. Will it lose them the election? Time will tell, but they certainly enjoy ignoring the book.

              So it lost them one election definitely, it may have played a part in another and yet they STILL persist on treating broadband as a relatively unimportant policy, something to be FUDed when possible, but otherwise ignored for real debate. Mmm, these are definitely the people I want running our country.

              Sure, Labor are pretty crap too, at least they learn from their mistakes at the moment…

            • Abel Adamski
              Posted 30/05/2012 at 8:15 pm | Permalink |

              Alain, true in 2007 they didn’t have the current NBN, however they did have a well thought out NATIONAL plan based on FTTN and wireless for rural. Poor old Libs had OPEL, marginal technology based on WiFi in the wrong frequency spectrum for optimal performance. I had very vigorous discussions on the old Yahoo News Message boards. Many of the points strongly raised with evidence and links became issues being defended or addressed or whitewashed in the media and by the parties. There was 3000 word limits and links permitted. admittedly the lanslide result would have swamped any Broadband policy influence. However the boards were closed before the 2010 elections and were reopened several months later more as a social site

            • Abel Adamski
              Posted 30/05/2012 at 8:29 pm | Permalink |

              alain. 2007 over with, now as to the need which the Libs fail to comprehend
              http://www.businessspectator.com.au/bs.nsf/Article/NBN-telco-monopoly-Telstra-Nokia-Microsoft-Blackbe-pd20120529-UQVNK?opendocument&src=rss Plus so many other business articles over the years and current.

              Business is moving to greater control of their IT infrastructure, processes and implementation, personal tablets and smart phones are being integrated and boosting productivity, of course with business plans they buy a QOS guaranteed minimum perfomance which of course cripples the networks for other users when all the road warriors, execs, transport, contractors, tradesmen etc are all out and about. WiFi hotspots become more important and home WiFi is encouraged. Yes tablets and mobile devices will largely replace the Box PC, Many homes will however have both, the PC for the pure grunt and the keyboard and large screen even if only replaced every 5 or more years. With each incremental and exponential jump, data volumes jump. The Flexibility of the NBN as is is even more necessary

              • Posted 30/05/2012 at 8:46 pm | Permalink |

                Interesting article Abel. Telco’s have known for a few years now their prime position in the integration IT sphere was waning. Look what happened to RIM when it tried to continue being the all-in-one for business, but missed all the added functionality of more consumer type devices. Now of course RIM isn’t a Telco per say, but they were trying to provide the services a Telco normally would. And it’s fallen apart on them.

                Business wants more fine control over every aspect of their IT integration. If there’s a new App that allows mobile payment, they want it integrated now, not wait 18 months while a Telco hammers out large licensing deals for extra profit. It speeds transactions and engages customers, which in turn drives growth through innovation.

                The NBN will, as the article states, MASSIVELY boost this scenario, allowing ALL businesses, not just the larger ones who can afford full time integration management, to access these types of services through 3rd party vendors at a fraction of the cost and much more efficiently.

                We get very hung up here on the consumer impact the NBN will have- probably understandable considering alot of us are exactly that and are desperate for improvement. But, with the exception of a few of Renai’s articles, we don’t pay much attention to the massive difference the NBN is going to make to business and the telecommunications structure.

                Even if the NBN had no tangible benefit to everyday Australians, which is far from the truth, its’ benefit to business alone would outweigh its’ costs and associated problems. You only need to look at the plans big business is ALREADY putting into place to see that they’re ready and waiting for this change.

                • Abel Adamski
                  Posted 30/05/2012 at 9:38 pm | Permalink |

                  True, seven
                  Another point as an extension is of course re the service available from any particular home. Just because Aunt Nellie is 80 and only wants a phone, she won’t live there for ever, when the house is up for sale and the rising young executive and his professional wife who can afford to buy that house will be wanting to buy a house with the NBN connected and ready to go. Aunty Nellies house would be taken out of consideration for possibly a slightly less desireable home with NBN, they can always fix it up a bit. That is where the HFC and FTTN falls down
                  My point is the NBN is Business capable from the very start from any fibred premises

                  That is why I can’t understand the Libs and the Media’s obsession with sabotaging business productivity and innovative capability for some ideological clap trap and power trip. Maybe the Rhodes scholar influence. Old Cecil worshipped the British Empire, considering the Monarchy and Nobility with the born and raised to rule over the subjects was the optimum means of government, I first read up on it 40 odd years ago when we still played Rhodesia in Cricket and rugby. The current information has had the PR makeover since than

                  • Posted 30/05/2012 at 10:05 pm | Permalink |

                    I certainly can’t understand the Coalitions view of the NBN in this Abel.

                    Actually, I can. I was discussing this with my father, who’s watched Abbott carefully as he was proteged under Howard. Abbot has always been a head-kicker. The Bully-boy of the Liberals, willing to bust down the doors to get things done. A little like Steve Jobs, but without the brilliance and business expertise. He’s arrogant, stubborn and undeniably determined, which are all good traits in the positions he USED to be in.

                    As leader of the Coalition, however, these traits are detracting, not helping. We’ve seen one of the most negative campaigns from an opposition ever, starting out with his promise to “bring this illegitimate government down” regardless of what the Australian people believed was right. He truly and honestly believes it is his JOB to destroy the government, little knowing that in focussing on this so much, he is missing the point of opposition- opposing policy.

                    We’ve not seen a solid, properly thought out policy from the Coalition under Abbott, except for the paid maternity scheme, which now seems destined to be dropped in the continuing effort to ensure the Coalition, if it gets into power, keeps its’ promise of “stopping the reckless spending”. He’s agreed with a carbon price, just apparently not our one. He’s agreed with a Broadband initiative, just not the NBN. He’s talked about cutting this spending, but he hasn’t got any solid details on where exactly he’s going to get the money to do it. He wants to kill the MRRT and that will only leave a big hole, adding to the problem. The most poignant thing in all of this is that most (perhaps not the Carbon Price) of these business accepts (except the miners on the MRRT) and even awaits and the Coalition has ALWAYS sided with business….but apparently not this time?

                    I hope, oh do I hope, that Australians will be switched on enough to see this getting closer to the election. The electioneering won’t even BEGIN until the new year, but if Abbott hasn’t started to change his tune by then, I’m hopeful that this anit-opposition he has going will be called out. It is perhaps reflected in the way that in the same week Abbott makes his budget reply about “wasting $50 Billion to rip up the country to provide broadband speeds no one needs” that Turnbull starts to concede the Coalition will, in fact, honour current NBN contracts and work with NBNCo. in the future to provide broadband. This is a huge change from 3 months ago, when he was still saying he’d been given the mantra to”destroy the NBN”. There’s a growing divide that is realising, I believe, in the Coalition, that this current insurmountable lead they have is, in fact, likely to erode if policy doesn’t catch up with head kicking.

                    I’m basically politically agnostic. I vote on best policy, not party. I don’t have time for the bullshit politics this country pedals these days. I’m after the best policies to improve our country- I don’t care if they’re enacted by Labor, Liberal, National or the Shooters Party (god forbid). For this reason, unless the Coalition were to state, straight out “we will honour the NBN plans as they stand” they ain’t got my vote. And my father? He’s been a staunch Coalition voter for 50 years….and even he can see Tony Abbott is not the right man to lead the country and he HATES Julia, but he’s seriously considering his vote this time against the Coalition.

                    • Alex
                      Posted 30/05/2012 at 10:52 pm | Permalink |

                      Labor do look like they will get beaten next election and the NBN as we know it, “altered”.

                      However, Labor have one hope imo…Tony Abbott, people don’t like him. He is less popular than even Julia Gillard and now more unpopular than he has ever been.

                      Go forward to 3 months to before the election. If the polls haven’t turned, I’d suggest Labor will fight fire with fire and go 100% negative, aimed at Abbott, to drive this home.

                      There will be be his infamous head wobbling silence, admitting to telling fibs and of course saying just put a tax on carbon, at every TV ad break.

                      Any odds on the next election being fought between two different leaders than we currently have?

                    • Abel Adamski
                      Posted 30/05/2012 at 10:52 pm | Permalink |

                      True, I too am a policy voter, however I observe that in reality Labor appears to have been more business friendly including small business. Take the personal property security register, we use it for cars, it is national and replaces approx 500 registers of property including farm machinery, cars, trucks, tradesmen and business equipment, basically anything that can be financed. created for the farmer and small business and their lenders. We can also benefit from it. So benefit for all. Actually a very major IT project up and running in Feb, with just some minor teething issues which they identify along with workarounds. Actually quite impressive. Did you know about it and what it is for?, finance companies love it.
                      Keys2Drive, about saving young lives – we taught them how to drive , were back seat drivers, taught them how to pass the licence test, then for the first time in their lives they are solo drivers, that is where the problems start, learning how to be a solo driver the hard way. K2D designed to address that with the parents involvement. Well promoted by the media? no way, who cares about saving Lives, it is a Labor program and Abbott is sure to cut the waste

            • Alex
              Posted 31/05/2012 at 11:29 pm | Permalink |

              It’s funny how animated the anti-NBN circus are, bombarding us with their political crap… until their baseless bullshit is inevitably shown for what it is.

              Then they disappear, only to resurface at another thread sprouting the exact same, disproved bullshit, as being factual.

              Unbelievable.

    27. seven_tech
      Posted 30/05/2012 at 10:39 am | Permalink |

      “Interestingly enough if a snap election was held this weekend the Coalition would win easily without any change to what they have already stated what their Communications policy would be.”

      Isn’t it wonderful we don’t live in this world then when elections can be held the following day after an opinion poll though. Because it gives time for people to see that the Coalition not ONLY don’t have an decent policy on broadband, but also on almost any other major area.

      The Coalition may HAVE heaps of time to fine tune a policy- problem is,they’ve gotta come up with one first, that doesn’t involve vague outlines and no real fleshed out idea.

    28. Troden
      Posted 30/05/2012 at 1:55 pm | Permalink |

      As soon as i can get it i will be ordering the 100/40 plan with out a doubt

      • GongGav
        Posted 30/05/2012 at 2:01 pm | Permalink |

        Personally, I’m in 2 minds. Right now, I have ADSL2+, supposed to be 24Mps, in reality I get 6Mps. With just 2 computers online at once, combined with all the other products synching on the same bandwidth, my lag is random and unacceptable. But the reality is that I effectively have a 6Mps connection.

        If I connected to the lowest plan, and it actually delivers 12Mps, then that should mean my bandwidth is twice as good, and it should cope with the competition my network currently suffers under.

        But I will be working under a cash incentive process. Meaning that I currently dole out $75 a month (give or take) for net and landline connectivity. As I still want the landline, I can work towards a package deal giving net and VOIP inside that price point.

        Meaning I’ll probably be connecting to a 100Mps plan… 50Mps at worst, but if the 100Mps plan is within $10 of that pricepoint, its a no brainer to go that extra step.

        • Hubert Cumberdale
          Posted 30/05/2012 at 2:44 pm | Permalink |

          “Meaning I’ll probably be connecting to a 100Mps plan… 50Mps at worst, but if the 100Mps plan is within $10 of that pricepoint, its a no brainer to go that extra step.”

          Wait a minute, wait a minute, wait a minute.

          Are you suggesting that you would be willing to pay more than what you are paying now to get a 100/40mbps plan??? This is unprecedented, I mean I realise that 100mbps would give you 16x more download speed and 40x more upload speed but can you really justify paying an extra $10 for this vast improvement???

          • GongGav
            Posted 30/05/2012 at 3:16 pm | Permalink |

            Its a tough call HC… At the moment I pay $50 a month for ISP (ADSL2+, delivering a 6Mps speed) and $20 a month for phone, so $70 plus calls. If I can get a 50Mps connection for that along with VOIP, it is a step up from what I have. At that point, if its $80 for a 100Mps package, sure, why not. My price hasnt changed in 5 years, I’ve gotten a little more than a $10 payrise in that time… I can probably justify the extra.

            Seriously, I see many people ending up doing the same. If ISP’s approach it the same, bundling VOIP phone services (which are dirt cheap) with the ISP, they will get people doing similar. The net result being a savings, or at worst on par, but ending up with a significantly better net plan.

            Right now, Exetel offers a 100Mps/300Gb/month/VOIP package for the amount I quoted – $70 a month. I guess I can afford to lose 200Gb a month that I dont use… Look at their plans, they cover everyones needs. All plans including VOIP, ranging from a low 12Mps/50Gb plan for $35 (so $15 for internet if you allow dollar for dollar costing with the current landline), up to $70 for the 100/300 plan with VOIP – or $50 for 100Mps/300Gb.

            I know you’re just being cynically sarcastic to needle the FUDsters out there, but its actually a debate I have with friends regularly. They seem to think their costs are going to double or more, for a worse connection. I just use that real life example to prove them wrong.

            To answer you though, yes, I would be willing to pay for that better connection. Go figure. Happily it seems I wont have to.

            • Hubert Cumberdale
              Posted 30/05/2012 at 3:48 pm | Permalink |

              :-)

              Yes, I am in a similar situation, my total cost on ADSL2+ is $139 ($39 is for a phone I rarely use so I’d ditch that completely and stick with Skype). For $99 I can get a 100/40mbps plan and this is what I’ll sign up for if and when NBNco rolls out here, if however a 250/100mbps plan was available and was at retail $149. I think I could justify the extra $10. The way I see it I have two choices: 1 Save money and get superior service than my ADSL2+ plan. 2. Pay the same amount as I’m paying now or even a bit extra and get an even more superior 100mbps upload which is 100x faster than ADSL2+. With this sort of speed back ups would be even more breezy. Say 500gb takes about 6 weeks to upload on ADSL2+ that time is reduced to ~32 hours with 40mbps but it is reduced to ~11 hours with 100mbps. Think of all that electricity and monies saved :-)

              • GongGav
                Posted 30/05/2012 at 3:58 pm | Permalink |

                “I am in a similar situation” — I expect most are in the same situation. The FUDsters out there preach higher prices, conveniently forgetting that the NBN cost usually includes the phone. Which for most is another $20 a month on top of their net connection.

                The packaging of both comm’s options into 1 is one of the biggest benefits of the NBN. No longer will people be held hostage by Telstra’s line rental, which they have openly admitted is higher than it needs to be simply because of data traffic.

                Dont ask for a reference, you wont get one, given that was 6 or 7 years ago now.

                But its an important thing to consider, and one a lot of people forget, through innocence, or convenience. Some sort of ~ence anyhow. When people preach the ‘higher cost’ of the NBN, it shouldnt take long to debunk them.

                And yet I still have to explain it to someone every week or two.

                If the higher uptake drives costs lower though, we wont have to worry about that extra tenner :)

    29. observer
      Posted 30/05/2012 at 2:30 pm | Permalink |

      Patience people.

      There is so much speculation about take up rates and speed of connection. It will soon be revealed.
      At present we are mainly looking at trial areas. By next year, the sample will be much larger and representative. Furthermore, many more potential users will have not committed to long term contacts. This, in itself, should have an impact on take up rate.
      The reason the opposition and its devotees desperately want to create fear and chaos, it is simply because the real numbers are coming and they won’t look good for them…
      You could, off course, conduct a survey of people in trial areas and evaluate how many would, but cannot, sign up due to contractual obligations with their current provider. But why do so, when with a little patience, real firm numbers will, one would hope, silence them for good.

      • GongGav
        Posted 30/05/2012 at 2:53 pm | Permalink |

        While you’re right Observer, there are a few things to also consider. First, if there are people locked in to long term contracts that would connect but cant, then that just makes the current figures all the more impressive. If they WANT to connect to the NBN, then its got to be for a reason, and the only reason I can think of is for a faster connection. If they were to connect to the slowest plan, its more likely they’d stick with their current provider, rather than make a leap of faith and switch.

        So if they were more likely to connect to a 25Mps, or 50Mps, or 100Mps over the 12Mps option, then thats just a higher percentage NOT on that base speed as expected, meaning the expected revenue generation will be just that much more.

        Its something I’ve tried to (poorly) point out a few times. If they expect 50% of early adopters to be on the slowest plan, then its for zero benefit to the customer, so why WOULD they be changing. These numbers dont surprise me at all.

        Either way, it still makes no difference. Based on expectations, there is still a much higher percentage than expected on the highest plan. However thats cut up, its still 475% of plan (38% isntead of 8%)which is much much higher than expected.

        Personally I’m enjoying the arguments that only 30% of the expected slowest plan numbers is somehow proving the NBN’s faults…

    30. the lone gunmen
      Posted 30/05/2012 at 4:47 pm | Permalink |

      The NBN has very few customers, you would think they signed up millions of customers when you read comments here. Too much NBN Kool-Aid guys, it blinds one to reality. They have thousands of customers, not millions. The NBN are well behind their own milestones, simple fact. But that is hard to swallow when you are guzzling Kool-Aid.

      Delimiter cannot objectively report on the NBN, its bias and prejudices are just too obvious. But it makes for a good laugh every now and then.

      • Hubert Cumberdale
        Posted 30/05/2012 at 5:29 pm | Permalink |

        “The NBN has very few customers”

        It’s a nine year project that is due for completion in 2021 not 2012. What are you expecting exactly?

        “you would think they signed up millions of customers when you read comments here.”

        No, what we are looking at is the percentages that are above and beyond what was predicted for the higher speed plans. You sound bitter and jealous about this. Sorry you find this all a bit too much to take but perhaps it’s time to build yourself a bridge and get over it.

        “They have thousands of customers, not millions.”

        News at 11.

        “guzzling Kool-Aid. ”

        ho ho ho, he said “Kool-Aid” guys.

        “But it makes for a good laugh every now and then.”

        Well if we want to laugh more often we can just read your comments. (Hint: just add kool-aid)

        • Alex
          Posted 30/05/2012 at 6:09 pm | Permalink |

          Ah Kool-Aid, just like Malcolm said in relation to the NBN.

          But TLG’s not politically motivated of course.

      • Observer
        Posted 31/05/2012 at 12:31 am | Permalink |

        “you would think they signed up millions of customers when you read comments here.”

        You obviously have some issues with understanding. This is why you are probably the only one who thinks that any comments on this thread suggest millions of customers.

        Also, you concept of bias needs some revising. When you ignore the issues that have delayed the NBN (eg. the Telstra agreement) to make your point. Now that’s evidence of bias. A bit of projection don’t you think.

        As for your poor attempt at humour a la Turnbull. Not too good either.

        Please keep us up to date about your laughing when the numbers start to increase rapidly as the construction phase is in full flight.

    31. Posted 01/06/2012 at 6:13 pm | Permalink |

      http://www.engadget.com/2012/06/01/chelsea-kensington-council-reject-bt-broadband/

      I’m terrified this is what is gonna happen here to NBNCo. I know they have an advance program that is looking ahead to stop things like that, but, I could already see our council refusing the green box, even if they only needed one.

      I’m glad they were at least able to work an agreement to use exchange space- we have some available down here. Even so….

      Brace yourselves….the stupidity of councils is coming….

      • Abel Adamski
        Posted 01/06/2012 at 10:59 pm | Permalink |

        FTTN, requiring more cabinets that need to be powered. However BT has the right idea, just do other areas.
        The ratepayers will be impressed a couple of years down the track, I wonder what recourse businesses that would be negatively impacted by the inferior service would have, the same for Aust, considering they could have had the NBN

        • Posted 02/06/2012 at 10:08 am | Permalink |

          Business probably would have nothing Abel. That’s the point. A non-NBN policy locks Australia into horrendously priced slow broadband until a government can get in with a majority and try again, this time hoping their majority outlasts the time it takes to build the network.

          The ironic thing in all this is, the Coalition aren’t arguing against an NBN….their arguing against an NBN NOW. They keep saying things like “there’s still life to be had from copper/HFC” but that is essentially admitting they’ll die eventually and then what is the replacement? FTTH…..

          It will happen eventually, we can’t keep living in an increasingly digitalised world without significantly faster broadband at some stage, which only fibre will provide to the majority. It’s just that due to some extremely stubborn and short-sighted politicians, we may have to pay double and wait twice as long to get it….

    32. Anthony
      Posted 02/06/2012 at 3:41 pm | Permalink |

      Hi guys.
      Been reading this post all day with great vigour (and headache).
      I only hope that the rest of the country see’s it like you do, as it will be a great shame if they don’t.

      What I would advocate is that you do your best to promote FTTH NBN to as many people as you can outside of this arena. By as many means available. As this is the only way that we can continue the roll out past the 2013 election.

      Regardless of wether people vote Labor or Liberal this must go ahead.
      So even the Lib loyals must point out to their cronies how important this is to go ahead.

      Otherwise we are all screwed like the wine cork.

      I’ve been gathering information all week to do just this. But the information that is hardest to find is exactly how hard it is to UG from FTTN to FTTH. If I want to have any solid argument for the FTTH, this topic has to be covered accurately.

      Any help or links will be more than appreciated.

      Thanking you in advance for your help and after the fact for your detail above.

      • seven_tech
        Posted 02/06/2012 at 4:05 pm | Permalink |

        Good call Anthony. I’m already doing my best on Facebook and have an NBN blog, but it is difficult getting through to people how much of a disadvantage it will be without the NBN. Average Australians see broadband as an essential service these days and are often not all that interested in the way it works or how bad it could be.

        Still, plough on we must, because we need the NBN.

        In regards to the UG from FTTN to FTTH I’m currently writing up a blog post about this, but suffice to say, one of the problems is it is not a direct UG. Yes, alot of the backhaul and hardware at exchanges will be compatible withheld FTTH but the hardest part, the nodes, have to be ripped out.

        Basically, FTTN will only be an upgrade to people IF the Coalition extend the ‘nodes’ past the exchange, a bit like node splitting in HFC UG’s. This will shorten the last mile copper between the premises and point of fibre interconnect, thus enabling higher speeds across the copper (up to 24mbps with normal ADSL or around 60mbps using VDSL but ONLY within 1.5km between the premises and the node). These nodes would be put on many corners and each must have active (powered) hardware to convert voltage on the copper to the digital light interface of the fibre.

        Ok, so, assuming the Coalition do this ‘node splitting’ that’s all straightforward (half the problem is we have no real detail about Coalition BB policy, but we’ll go with this for now) The problem comes, when we inevitably UG to FTTH, these nodes all become superfluous. In FTTH there IS no last mile copper so no nodes are required to convert. AND the lion share of fibre has to be run alongside copper, as the only fibre other wise is run to the node or exchange, leaving tens of thousands of kms of fibre to run to turn a FTTN into an FTTH.

        So essentially, an FTTN network now would result in twice the money being spent later to rip out the nodes and re-roll fibre to the home.

        I hope that helps a bit. I’m trying to find previous examples and links for support for my own piece, so when I find them, ill post them up here.

        I apologise for any spelling or weird words. My poor old HTC Desire can’t handle this page it’s so big so I can’t scroll up. Bring on my HTC XL! :D

        • Anthony
          Posted 02/06/2012 at 6:56 pm | Permalink |

          Pity you don’t have fiber to do it on eh?

      • Abel Adamski
        Posted 02/06/2012 at 8:48 pm | Permalink |

        Anthony I will refer you to a beautiful relevant case of egg meet face/bullet meet foot

        http://www.theaustralian.com.au/business/property/trying-to-pick-winners-in-age-of-nbn/story-fn9656lz-1226380648986

        The complaint is that the outer residential areas and the University and schools had fibre installed but not the CBD. The businesses in the CBD are disadvantaged by inadequate uncompetitive broadband . OK

        Exchanges are situated usually within approx 1KM of the CBD in most centres, and also the industrial areas tend to be relatively close to the exchange.

        In other words what they have available is cable runs equivalent to that which would be provided by FTTN with high speed ADSL2+ and XDSL available. This is clearly stated to be inadequate

        Egg meet Face

        • Posted 02/06/2012 at 8:55 pm | Permalink |

          AHA HA HA!

          That’s ridiculous. Not surprising coming from the Australian though. I can’t read the whole article, because I’m not a member and I refuse to pay for the rubbish they peddle. I’d rather pay for SMH and I’m not really happy doing that.

          This is classic Australian. They constantly criticise the NBN as a waste and non-viable…and now they complain businesses can’t get it because it’s going to residential areas by preference, so they’re suffering….for a network that, if the Australian had their way, wouldn’t get built….

          Nice find. Anyone got access to the whole thing?

          • Abel Adamski
            Posted 02/06/2012 at 9:23 pm | Permalink |

            It actually is one of the items NOT behind their firewall, for me anyhow. I also refuse to subscibe to them

          • Alex
            Posted 02/06/2012 at 9:28 pm | Permalink |

            Just Google, trying to pick winners in age of NBN and the article will come up and you can read it, as I just did.

            • Posted 02/06/2012 at 9:31 pm | Permalink |

              Ah yes, I forgot, they require you to login, even if you DON’T pay.

              Cheers

            • Abel Adamski
              Posted 02/06/2012 at 10:20 pm | Permalink |

              Actually I just go to Google news, I have selected a filter for NBN.
              Makes it easy to see items from all sources

              • Posted 02/06/2012 at 10:27 pm | Permalink |

                I use a Chrome RSS reader, focussed particularly on IT and Tech sites, but I’m starting to think Google news or similar with filters would be better for the NBN, as you’ve done.

                I pick up alot, but miss some gems like that.

            • Anthony
              Posted 03/06/2012 at 6:44 am | Permalink |

              Yeah I couldn’t find the real full article as every page re-directed me to The Australian.
              I’m not going to sign up for a 28 day free trial to be plagued with data sucking commercials as I read an article. I’ll wait for the NBN before I do that. If I’m gonna spend any money I’ll buy the paper from the shop so I can take it to the crapper and have a really good read.

              On topic, this was always going to be a problem with any Roll out. People would miss out initially. Funny, this is a part of life. But thankfully the NBN is trying it’s best to ensure as many people as possible, don’t miss out. Which I kinda like.

              It will be ‘The Great Leveler’. But only if done right.

              I would assume (you can look it up but I’m not going to just yet) that (most) areas they are servicing are areas with poor infrastructure that desperately need to be upgraded.
              From my understanding David Thodey sat down with a heap of technicians and said ‘Right, what do we need to fix first, and where can we do this without working over ourselves’.

              Ok I paraphrase, but you get the gist. I haven’t been to school for sometime but I would assume that their internet is faster than alot of people have at home. I would assume this for business too. And every workplace I’ve worked at, has had faster internet than I have at home. (This is on assumption that the ‘private enterprise’ that is my workplace, has upgraded their computing hardware this centuary. But that’s a topic for a different thread :-)

              And many ‘buisinesses’ work from home. So I really don’t see it as a problem.

              In saying that I might log on to the Australian and say just that……

              • Posted 03/06/2012 at 12:47 pm | Permalink |

                “From my understanding David Thodey sat down with a heap of technicians and said ‘Right, what do we need to fix first, and where can we do this without working over ourselves’.”

                You mean Quigley. David Thodey is the head of Telstra :D There’s too many bloody names in this sphere!

                There’s no question NBNCo. have worked out their plan which covers as many poor infrastructure areas as possible (I’ve not seen a LNP MP try on the “You’re only building it in Labor seats!!” for a while….) The problem is, it can ONLY do this to areas that desperately need it first IF the backhaul exists to get it there. Otherwise, you can fibre all the streets you like, but if there’s no fibre to get back to the next main hub, it’s useless.

                It’s great saying, as people have, that Pilbara in WA, where massive new housing estates are going because of the mines, desperately needs it (because all they have is satellite) but it doesn’t take into account that there IS no backhaul at all there. It has to be built first! And that means NBNCo. have to juggle areas with backhaul that desperately need it, with areas that don’t have it and BUILDING backhaul to get to them.

                The point is. and this is what frustrates me no end, 93% of premises will get it eventually. Compared to MAYBE 60% getting FTTN under the Coalition. Australians see people getting it and cry foul “what about me! I don’t have it and I’ve not had it longer! FAVOURITISM!!!” It’s what we do in this country. And all it does is muddy the political waters, it doesn’t actually help anyone.

                Look long term people. Hell, even by business standards 10 years in Australia is long term, but in reality, 10 years for the VAST majority of premises in the whole 2.2 MILLION sqKm of the country to get a cable that will allow them the fastest internet that can be piped for at LEAST the next 40 years, isn’t bad. And it isn’t long term. Have a look at Japanese business plans, like Toyota….90 YEARS!

    33. Abel Adamski
      Posted 02/06/2012 at 9:18 pm | Permalink |

      Plus NZ started installing a National FTTN network. Decided inadequate and are now installing FTTH

    34. Anthony
      Posted 03/06/2012 at 11:52 am | Permalink |

      I come across this one today on a FB page —>
      https://www.facebook.com/notes/andrew-heslop-commentator-mc-and-community-advocate/australias-broadband-future-delivers-broad-global-thinking/425212484175807

      Seven Tech what’s you FB page called? Or a link?
      ta

      • Posted 03/06/2012 at 12:59 pm | Permalink |

        Not a bad read Anthony. Have to be careful comparing Hong Kong though. It’s about 1/1000th the size of populated Australia and with 1/4 the people, so they have a MASSIVE advantage of density. He makes some good points, but doesn’t focus enough on the advantage in Australia of having one company roll it all out. The thing is, in a country like Hong Kong, infrastructure competition makes sense, because there’s so little area, meaning almost everywhere is profitable. In Australia, that’s FAR from the case.

        My own blog is httP;//nbninfo.blogspot.com.au

        My next post is going to cover FTTN vs FTTP more carefully (I’ve already covered it briefly). My posts are fairly long, but I try to keep it as simple as possible though But it’s not easy; it’s a complicated topic.

        I’ve yet to start a Facebook page yet. I’m going to try and coincide with the website I’m talking to a friend about building, which will be a survey site, completely unbiased, asking Australians what they think of the NBN. ie. Should we have it? If not/so why? Do you know if you’re getting it? Does when you’re geting it make a difference? etc. It’d be great to have this info, because it can give an idea of what people are thinking and or mistaking about the NBN. I’m gonna work as hard as I can to make it non-political and unbiased, but there HAVE to be a few questions about political preference; for many, it’s the only REASON their voting against it. But that info is useful to have too. I’m hoping through a combo of Facebook, Twiiter (which I don’t actually use yet) and emails to my friends sent on, I can start to get, even a couple of thousand respondents. There are similar sites, but the best one The Australian Broadband Survey, covers all broadband and I want to get a picture about the NBN specifically.

        Who knows, maybe the data will be decent enough to start a petition to the Coalition to show them people want it. Or maybe I’m just being grossly optimistic :D

    35. Michael
      Posted 03/06/2012 at 10:24 pm | Permalink |

      Most people I know who are interested in the NBN are all for the 100Mb/40Mb speeds!
      I’m paying $60 a month for 50GB ADSL2+ connection! (Telstra DSLAM).
      Even if I was on an Optus/Internode/TPG etc DSLAM with naked ADSL only paying $30 a month,
      I would still pay double for a 100Mb connection!

      I will be converting my whole family over to NBN, not everyone is a techhead like us.

      • Posted 03/06/2012 at 10:29 pm | Permalink |

        +1 Michael. Enough conversions made the world Catholic in the Renaissance…..we’re still paying for it…lol

        Seriously though, enough people accepting the NBN widely will boost its’ numbers and publicity, which is what you need in a political war.

        P.S. I have nothing against Catholics. They’re a funny bunch, but harmless :D

    36. Steve
      Posted 22/07/2012 at 3:19 pm | Permalink |

      NBN still looks damn expensive http://newamerica.net/publications/policy/the_cost_of_connectivity

      • Anthony
        Posted 22/07/2012 at 4:14 pm | Permalink |

        Well you take 22 odd million Australians and spread them around a country this big….
        You do the maths…

        Best you move to America if you aren’t happy, then if you still aren’t happy you can shoot something….

      • Posted 23/07/2012 at 2:08 am | Permalink |

        @Steve

        That’s an interesting attitude to have. Verizon’s FiOS (FTTN/FTTH) and AT&T’s U-Verse (FTTN/FTTH) both cover, separately, around 13 Million premises, as many premises Australia has in total…..plus between them they maintain some 60 Million premises worth of copper phone lines….

        France has 2.5 Times as many people as Australia. Hell, even Hong Kong has almost half as many….in an area about the size of the Greater Sydney Basin….

        Do you think perhaps there might be the small reason of density – geography which might explain our slightly higher prices??

        I can almost guarantee if you have a decent broadband connection in a regional area it will be cheaper for you on the NBN. And actually for that matter if you’re on HFC OR if you’re in a city suburb. OR if you DON’T have a decent connection. Or EVEN if you do AND you get it fairly cheap.

        No, our services AREN’T as cheap as the US. Or France. Or UK. Or Sweden…..perhaps you can convince Tony Abbott, if he ends up in, to not only continue the NBN, but let all the boat people in as well to offset our tiny population compared with our size…..then we might all more closely match those other countries for density….

        Good luck with either of those….

        • Steve
          Posted 24/07/2012 at 8:38 am | Permalink |

          Hi seven_tech

          There’s no need to be an apologist for the NBN, I’m well aware of the population and geography of Australia.

          What makes telecommunications different from other goods and services?
          Do you think there might be a mistake in a universal service obligation model for delivery of internet services?

          We don’t do that for food and groceries, they are up to 60% higher in regional Australia, while rent and fuel are also higher (http://www.oesr.qld.gov.au/products/publications/index-retail-prices-qld-reg-centres/index-retail-prices-qld-reg-centres-201005.php#heading-basic-basket-food-tobacco-and-other-groceries-index-remote-and-very-remote-centres).

          We don’t do that for health care either (http://www.health.gov.au/nrrhip).

          Nor for electricity (http://www.sa.gov.au/subject/Water,+energy+and+environment/Energy/Energy+supply,+providers+and+bills/Electricity+and+gas+supply/Energy+supplies+in+remote+areas).

          Instead, State and Federal Governments subsidise regional and rural services to offset the cost of providing these services while allowing cherry picking by market forces in urban Australia, except somehow there’s a view that this won’t work for telecommunications.

          By the way, I agree with you, we should be rapidly growing our population preferable in regional Australia to create a significant domestic market and we should be completing the NBN.

          • Posted 24/07/2012 at 3:36 pm | Permalink |

            Hi Steve

            My apologies for the terse reply. I had a bout of sinusitis that day and I was rather irritable!

            “What makes telecommunications different from other goods and services?
            Do you think there might be a mistake in a universal service obligation model for delivery of internet services?”

            Not at all. The United Nations has declared broadband as a basic human right:

            http://www.forbes.com/sites/randalllane/2011/11/15/the-united-nations-says-broadband-is-basic-human-right/

            Which means, as hyperbolic as it sounds, we as a country are disrespecting the basic rights of many hundreds of thousands of our citizens who don’t have proper access to broadband. Now, obviously, it is not in the same vein as access to clean drinking water or fresh food, however, it IS an essential service.

            “We don’t do that for food and groceries, they are up to 60% higher in regional Australia, while rent and fuel are also higher ”

            True. But those groceries would be 160% higher in cost if those in Regional areas didn’t grow them for city dwellers and they had to be imported. But leaving that point aside, Regional people expect to pay more for everyday things but NOT essential services. It is part and parcel of supply and demand- While we certainly wouldn’t pay 100% more for a loaf of bread (and we don’t) we would expect that bread to have a surcharge because of the distance travelled and the cost to stock the same variety of items but that are sold in smaller quantities. The same goes for fuel (although this badly needs proper regulation, just like it does in the city, because supply and demand often seems to have nothing to do with it….)

            However, for essential services- Electricity, Gas, Water and now Broadband, we shouldn’t and should not HAVE to pay more. We pay roughly the same for electricity, gas and water as city dwellers….and yet broadband, essential to do work, perform business transactions, advertise and even just stay in touch with people, is usually literally twice as expensive, if not more than in the city (I pay $99.90 for iinet, when, for the same deal (without a phone, because I don’t want one) in the city I could pay $59.99- and that doesn’t even get into satellite or wireless only).

            I don’t see that as right, fair, equitable or even decent.

            “Instead, State and Federal Governments subsidise regional and rural services to offset the cost of providing these services while allowing cherry picking by market forces in urban Australia, except somehow there’s a view that this won’t work for telecommunications.”

            No, the providers cross-subsidise the Regional areas on Electricity, Gas and Water with slightly higher charges on city dwellers because they’re REGULATED to do so. There are only small amounts put in for subsidising these services from State governments, mainly by QLD and WA, because of their vast distances. NSW and VIC do not substantially subsidise any electricity, gas or water services, but they regulate strongly to force cross-subsidies.

            I’m glad you agree with the NBN and the need to de-centralise our population. I think we should be doing the same with our power systems for load sharing and redundancy too.




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