Can Australia afford the Coalition’s NBN?

1. Hear hear Rod…

   Not forgetting too, the respective government monetary contributions for FttP and FttN are less than $1B apart…

   • Well you can forget it, because $44.1b minus $29.5b is not $1 billion in the first place.

     • Show me where the Labor government is putting $44.1b in.

     • 30.5 – 29.5 is 1 though.

       • It’s a pity you all have to desperately rig the argument to try and get a funding differential argument going, you need to read the full text of the external report under discussion here.

         “At a whopping two-thirds of the cost of the vastly-superior FTTP NBN,”

         Two thirds of $44.1b is about $29.5b, there is no ‘$1billion difference’ even when third party analysts you love to quote because they back FTTP compare the policies.

         • @ Fibroid…

           “It’s a pity you all have to desperately rig the argument to try and get a funding differential argument going, you need to read the full text of the external report under discussion here.”

           Rig the argument…?

           Wrong and irrational and you should be reprimanded as per the comments policy, IMO.
           “•Comments which inject demonstrably false information into the debate”

           We have all agreed there are total costs, but just as importantly (if not more importantly to taxpayers – although the NBN isn’t coming from our income taxes) is the government contribution of each network. But yet you stamp your feet like a child and always ignore the whole equation… Nay you accuse others of rigging the argument… disgraceful.

           Q. What amount is the current estimated NBN government contribution?
           A. $30.4B

           Q. What amount is the estimated contribution needed to build the oppositions network.
           A. $29.5

           If you are unable to accept facts and discuss those facts with those like myself, who are here legitimately for meaningful apolitical discussion, I’d suggest Fibroid, you comment elsewhere, where irrationality and bullshit are acceptable.

         • B

         • So you disagree with the funding comparison in the research as stated above or not?

         • There are two costs to consider. Overall CAPEX cost, and cost to Government.

           One of those is $44.1b vs $29.5b the other is $30.4b vs $29.5b.

           You choose to argue with the higher amount, as it gives a greater gap between the two plans, when the rest of us choose to argue with the lower amount, as that gives a better comparison for our argument.

           So which one is the right one to use? Well, to me, I want to know how many taxpayer dollars are at risk, as thats all we need to care about, and in that case its $30.4b vs $29.5b. Or less than $1b difference.

           I’ll put it another way. Why do you choose to argue with $44.1b vs $29.5b?

         • It’s not just me GongGav, the research detailed above used it as well, in fact it was key to the conclusion.

           I use it for the same reason others use it in the analysis of funding comparisons, it’s the fair and correct figure to use.

         • The point is Fibroid, do you therefore, agree with

         • Sorry. Accidentally press the sent button.

           As I was saying, therefore, does it meant that you agree with the conclusion? Or do you just want to use the part that suits you.

           The point you evidently avoid , it that it is a waste of money whether the cost is $29.5b or $44b. But in the nitpick world of trying to defend the honour of the Coalition, at all cost, this cannot be taken into account.

         • I think it’s cute that Fibroid is concerned for the $13.7b of private investors :o)

         • As usual, you dont answer the question, or the accusation. I’m fine with using $44.1b vs $29.5b, if its the appropriate comparison to make.

           In the debate above, its fine to me. The argument is whether the overall cost of FttH @ $44.1b is worth it when compared to FttN @ $29.5b plus whatever future cost there is to upgrade it.

           There are specific things about your stance I dont like. One of the key ones is that you refuse to acknowledge that there are other arguments that have value, and isolate your argument to whatever makes you look good on the day. This is one of them.

           To get from ADSL2 to FttH we’re going to take one of two paths – direct to FttH, or FttN then upgrade. Which path costs more? One, we know the final cost according to plan – $44.1b. The other, we dont. All we know is it will be $29.5b and then some further cost as people upgrade with FoD to get to FttH.

           We’re only going to know the full cost of FttN –> FttH once a significant portion of the population (I’d say around 70%) are on FttH.

           So I’ll put it to you. What will be the final cost of FttH if we need to go down the FttN path first? Its going to be more than $29.5b, we just dont know how much more. The story above questions whether that unknown amount is worth it versus going straight to FttH.

         • You choose to argue with the higher amount, as it gives a greater gap between the two plans,

           This is the exact reason Malcolm invented the “$94b NBN”. He realised that the small gap that exists wasn’t enough to justify his plan.

         • But I or the analysis above is using the Coalition figure of $94b, I have never used the figure of $94b, it’s your conclusion the Coalition cannot justify their rollout by just using $44.1b.

           The $44.1b is a prediction, it’s not set in stone, it changed upward in the 2012-2015 plan, so there is no reason whatever why it won’t change again in the latest plan.

         • “it changed upward in the 2012-2015 plan, so there is no reason whatever why it won’t change again in the latest plan.”

           Splendid logic. So if you change your mind, there is no reason whatever (you must have whatsoever) why you won’t change it again next time you speak.

           In not so many words, once something changes, it will always change again. That makes a lot of sense. Not.

         • But I or the analysis above is using the Coalition figure of $94b, I have never used the figure of $94b, it’s your conclusion the Coalition cannot justify their rollout by just using $44.1b.

           I didn’t say “Fibroid”, I said “Malcolm”. You just like to be inflexible about the costs (“Total Cost” rather than “Total Government Cost”) because it makes the LBN look a bit silly otherwise. Malcolm decided to pad it out further (from $44b to $94b), as he thought the gap wasn’t enough.

           The $44.1b is a prediction, it’s not set in stone, it changed upward in the 2012-2015 plan, so there is no reason whatever why it won’t change again in the latest plan.

           The government doesn’t control “everything”, I’d expect them to make adjustments as things outside their control do change. I’d expect the same from the Coalition as well, or they are just kidding themselves with their “plan”.

         • Yes. I disagree with the funding comparison of the research above.

           1) It doesn’t take into account the 4 billion dollars already spent (the coalition plan spends 29.5 billion dollars ontop of that doesn’t it? – I am willing to be corrected on this point).

           2) it uses (or attempts to not withstanding 1) total capex instead of government commitment as the comparison.

           When it is research comparing the relative value to government this is the incorrect figure to use.

           I agree with the conclusion of the report however; because despite my belief that the numbers they use are wrong, the numbers I believe to be correct only further supports the conclusion.

           I believe that you can come to the correct conclusion; even if your data underlying your conclusion is inaccurate. (overstates one figure; or understates another). If anything; if you are conservative with your figures (use the total capex as the government contribution rather than the government contribution) and still determine that the funding is a better spend, then you have (if anything) been careful and cautious in your decision making.

         • “1) It doesn’t take into account the 4 billion dollars already spent (the coalition plan spends 29.5 billion dollars ontop of that doesn’t it? – I am willing to be corrected on this point).”

           Based on my reading you might be right but like some many things the devil is in the details which are sorely lacking.
           What I could find in the LNP plan is that they don’t plan to pay the existing commitments with revenue from NBN co. I’m sure they will blame $4billion+ blackhole on Labor despite it being 100% of there doing, if you undermined the revenue basis for a project you are liable for those costs.

         • Fibroid… seriously the childish nit-picking was humorously cute in an obvious subservient way, but now it’s becoming tiresome.

           So please read this three times so it actually sinks in, as I have said it many times ‘to you’…

           No one that I know of here has disagreed the fact that the two networks have a total price, that’s bleedin’ obvious isn’t it?

           So Part A of my answer (but wait… there’s more). TBH I’m not positive of the actuals (I don’t have multiple screens with all the info, trying to find a word to argue over… ;) but I’ll believe you wouldn’t lie about the totals and I’ll say again ‘yes” I agree (as best we know) those are the “total estimated costs for each network.”

           Do you understand?

           Now, before you start beating the chest wildly and claim a strange victory on semantics alone, please do not look at the above comment in isolation, refer to Part B, which is…

           Looking past the bleedin’ obvious, one can plainly see there are more important figures to factor in. Those being the two government spends…which are only $900m different. This can’t be ignored by anyone who is legitimately interested in Australia’s comms and not here with an ulterior motive or just to be argumentative.

           Q. Now as I answered, a question for you Fibroid…

           “Do you agree that my above figures are correct (as best we know) for the estimated government spends of each network.”

         • lolz, you really don’t expect that heartfelt plea to work do you Alex? A “discussion” with Fibroid is more like philosophers (or maybe Monty Python) debates :o)

         • As that’s in moderation I’ll add:

           Which is what makes him an interesting debate partner :o)

         • “A “discussion” with Fibroid is more like philosophers…”

           Now, that’s an insult to philosophers. This is more like a year 10 debating contest where you have to be right at all cost to win.

         • No…

           But if I said what I actually thought, I’d get banned…

           :)

         • Only a bit over a week to go. So, hopefully, the mission might have been accomplished and discussion will not longer by hijacked by diverting nitpicking.

         • “Two thirds of $44.1b is about $29.5b, there is no ‘$1billion difference’ even when third party analysts you love to quote because they back FTTP compare the policies.”

           This ignores:
           1/ An FTTP network will provide a higher return than an FTTN network and will be in a position to self fund to an extent
           2/ The $44.1 billion is the TOTAL cost of Labor’s NBN and includes the satellite and wireless deployments, the $29.5 billion covers only the cost of rolling out FTTN over the current FTTP footprint
           3/ As this article points out, there is no allocation for compensation to Telstra who’s copper network is VERY valuable in an FTTN world.
           4/ The $29.5 billion figure contains no contingency funding at all for things to go wrong but the $44.1 billion does.
           5/ The $29.5 billion contains no funding for ongoing maintenance ($10-$20 billion over 10 years) of the network whereas this is catered for in the $44.1 billion

2. “But careful analysis of the details of the Coalition’s NBN policy shows its FTTN network does not provide good value for money.”

   It’s a point obvious to all but those less educated.

   • Correction: It’s a point obvious to all but those less educated or politically motivated.

     • Seems you are right :-)

     • Correction: It’s a point obvious to all but those less educated or politically motivated.

       It makes me wonder what would happen to Fibroid if the Coalition do another policy back-flip and decide to go with FTTP. Would his head explode?!

       • No IMO he’d argue it wasn’t a back-flip whatsoever because he supported FttP all along… as long as fiscally responsible… and conveniently this new Coalition FttP would be deemed exactly that, I’m sure …

         Ooh and he’d do it with a straight face too, I’d imagine having seen many of the previous 180’s.

3. $11 billion for access without exclusivity? Only Conroy would negotiate such a poor deal. It is much more likely that a much better deal would be negotiated since the copper network already exists and thus less cabling is required.

   I don’t see a problem with allowing competition. Our economy is fundamentally based on competition making products better for consumers! If it costs more to provide broadband to Woop Woop then charge more. We have to pay more to live in a city but we pay for access to facilities and amenities. Bush residents should be expected to pay more for the same facilities if they want to live out there.

   • You make a good case for either removing the Flying Doctor Service or billing for its services. The same applies to Medicare and public education. Well Done!

     • Errr we have private hospitals and schools which compete with the public sector.

       • And that being said, both private schools and private hospitals survive on large amounts of government funding any wayand in both circumstances they alleviate the pressures on existing goverment systems which struggle with capacity. Further more both private schools and private hospitals are limited in quality and numbers outside of the major cities.

   • I don’t see a problem with allowing competition.

     The problem is there isn’t that much/enough competition in Australian telecoms, you’re seeing the results of that in the mobile network with Vodafone at the moment. The “competition” we do have in broadband is only through the result of regulation, because no one can out build Telstra.

     By levelling the playing field and creating the NBN Co to handle the wholesale part, they’ll actually allow better/more competition in the retail side, and the only one they’ll regulate (via the ACCC) will be NBN Co.

     • @Tinman-au

       ‘the problem is there isn’t that much/enough competition in Australian telecoms, you’re seeing the results of that in the mobile network with Vodafone at the moment.’

       One carrier Vodafone playing catchup with coverage in general and their 4G upgrade to Telstra and Optus defines how Telco competition therefore doesn’t work?

       ‘The “competition” we do have in broadband is only through the result of regulation, because no one can out build Telstra.’

       Well they could but it’s a hell of a lot easier and cheaper to resell Telstra and add a nice margin, with the ACCC setting the Telstra wholesale pricing.

       ‘By levelling the playing field and creating the NBN Co to handle the wholesale part, they’ll actually allow better/more competition in the retail side, and the only one they’ll regulate (via the ACCC) will be NBN Co.’

       That’s overlooking the number of independent ISP’s that have gone or have been absorbed into other ISP’s since the NBN rollout started, that’s ‘better/more competition’ is it?

       • One carrier Vodafone playing catchup with coverage in general and their 4G upgrade to Telstra and Optus defines how Telco competition therefore doesn’t work?

         So you consider Vodafone a great example of a health, thriving company and a showcase for your point of view then? Is that the same Vodafone that despite it’s best efforts is loosing 1000’s of customers a month?

         Well they could but it’s a hell of a lot easier and cheaper to resell Telstra and add a nice margin, with the ACCC setting the Telstra wholesale pricing.

         And that says what about the capitalist system exactly? That despite spending a lot of time and effort, everyone else can profit off Telstra’s hard work? Hardly sounds fair really, or an ideal situation.

         That’s overlooking the number of independent ISP’s that have gone or have been absorbed into other ISP’s since the NBN rollout started, that’s ‘better/more competition’ is it?

         That’s one of the flaws in capitalism, not the fault of the NBN. Big companies buy out smaller ones before they become a bigger company that can cause them problems later.

         • Dont forget One.Tel… With some of the deepest pockets in the country behind it, theres another triumph of competition.

       • Your faith in competition is quaint. Australia doesn’t do competition. In a new market you have competition. In a mature market the small operators have been absorbed by the others or driven out of business. Australia with its smaller population and peculiar circumstances matures much faster than other markets in the world. The ISP market 10 years ago was as competitive as we will ever see in this country. The remaining companies are all trying to be the next Coles/Woolworths or the next 4 banks or the Telstra/Optus ie a stitched up market where occasionally they battle for a few % of market share but sit on comfortable margins while the customer gets stiffed.

         For this reason the goals of the NBN with a locked return of 7% underpinning the economics of the infrastructure is the best thing for the communications consumer in Australia. Everything else is implementation and that is where the argument should really be centered.

         • +10

         • ‘For this reason the goals of the NBN with a locked return of 7% underpinning the economics of the infrastructure ‘

           It’s not a locked return, it is a prediction at a point of time, it can be changed anytime and is subject to all the risks as identified by the NBN Co in their last Business plan.

         • Of course like any investment, no one can make guarantees?

           You aren’t promoting yet more strange NBN only rules are you?

   • Surely you’ve heard of natural monopolies, Brendan? That is to say, markets where competition would be grossly inefficient and wasteful? Utilities are often cited as an excellent example of a natural monopoly, and what is telecommunications infrastructure if it is not a utility? Having competing telco infrastructure makes as much sense as having competing electricity infrastructure. And let’s not forget what happened the last time infrastructure competition was attempted in telecommunications in Australia – barely a quarter of the country got two HFC cables and the rest got precisely bugger all. Hardly a successful result.

     • I should have read your comment before posting.

     • @Quiet Observer

       ‘Having competing telco infrastructure makes as much sense as having competing electricity infrastructure.’

       So which two wireless telco infrastructures should be shut down, Telstra, Optus or Vodafone?

       • The way Vodafone is bleeding customers due to it being unable to match Telstra coverage, I’m not sure you should include it there…

         • Coverage was only one of Vodafone’s issues.

           They failed through gross mismanagement.

           If anything they are a sign that another telco that managed itself better could do well. The problem of course is that to be able to compete properly at that size they would have to invest massively more in infrastructure than vodafone obviously did.

           The market IS clearly there, but the ability to get into the market is prohibitively expensive.

   • I’ll just leave this here [wikipedia].

     If you believe it applies or not is your own opinion. I thought I would provide you the link so you can educate yourself in the concept, and not make silly generalizations like: “Our economy is fundamentally based on competition making products better for consumers!”, since this is not true.

     We have no competition in Roads. We have no competition in water. We have no competition in power transmission (!! we DO have [limited] competition in power production!).

     And there is a sound economic reason for all of the above.

   • I agree with you, competition is a good thing. That’s why we need the NBN. The NBN will enable so much more retail competition than the current situation with the near-monopoly that Telstra has.

     • Replacing one monopoly with another where both are regulated by the ACCC of course has nothing whatever to do with the amount of retail competition.

       In fact you will look back at the era where ISP’s had their own DSLAM’s in Telstra exchanges where fierce competition exists and still does for the ADSL2+ and Naked DSL dollar as being the zenith of BB retail competition.

       • It’s not real competition if a private company needs to be regulated, now is it?

         • @Tinman_au

           Telstra Wholesale is the current monopoly carrier, NBN Co will be the monopoly carrier, those are the areas of regulation the ACCC has powers over, the ACCC has already made some decisions on the NBN Co rollout methodology already and got them to change it.

           The ACCC also have yet to approve the NBN Co SAU, and have stated a decision won’t be made until after the election, when in all probability it may be withdrawn altogether as the whole NBN scene may change.

           Bigpond operates as competitor retailer with all other retailers like Optus, iiNet ,TPG etc for market share, the ACCC doesn’t regulate BigPond retail pricing (as long as it doesn’t discount the TW scheduled pricing resellers have to pay), or any of the others for that matter.

         • And Telstra wholesale never ever acted in a way that favoured its retail arm. (note; I was going to use cousin, but that would imply they weren’t of the same body).

         • The ACCC doesn’t actually have to regulate NBN Co, NBN Co has to do what it’s shareholder (the government) tells it to.

           Telstra however, as a private company, will only do what it’s regulated to do.

         • So the fact that have ACCC have already regulated the NBN Co in the area of POI’s and is approving or not as the case may be their SAU has escaped your attention?

         • I guess the fact that you’re OK with a government heavily regulating private companies to simulate “competition” at least shows your not a libertarian…

         • @Fibroid

           “Telstra Wholesale is the current monopoly carrier, NBN Co will be the monopoly carrier”

           That’s not an apples to apples comparison though, is it? Telstra are a private company with many divisions each large enough to operate as major corporations in their own right. Telstra are obliged to generate profit for their shareholders.

           NBN Co are a state monopoly only obliged to return an income at the rate required to meet funding obligations (7% ROI by 2034). With no other divisions or business interests NBN Co have no vested interest in using their monopoly position to leverage benefits to other divisions. They have nothing to gain by leveraging their monopoly position to increase prices to their retail ISP customers. As a private company Telstra have everything to gain by abusing their market position as the incumbent telco, and have done so (and continue to do so).

           Suggesting that you are simply exchanging one monopoly provider for another is a deliberate attempt to decieve and obfuscate the facts – elimination of private companies from infrastructure monopoly positions removes the temptation for corruption even if it’s not actively pursued (although history tells us that it very nearly always is), and thus such a policy is to the vast benefit of the nation as a whole and should be exhaustively explored and implemented wherever possible.

         • A monopoly is monopoly, Telstra was a monopoly before it was privatised and was owned by the Government, the NBN Co is a Government owned monopoly the intention of which is to privatise it as well.

         • @ Fibroid.

           “Bigpond operates as competitor retailer with all other retailers like Optus, iiNet ,TPG etc for market share,…”

           As they will under the current NBN…it’s know as competition, glad you are starting to finally grasp the basics ;)

         • NBN Co is a Government owned monopoly the intention of which is to privatise it as well.

           And I’ll be against that privatisation as well. Thats where all the problems with Telstra started for the rest of the industry, and all so JH could fritter away the proceeds on middle-class welfare…

         • The difference, of course, is that Telstra (as Bigpond) is able to compete (unfairly, anti-competitively) against its third-party access seekers (other retail ISPs). NBN Co cannot compete against Bigpond, iiNet, TPG, etc. If NBN Co only ever offer wholesale services (and that’s the plan), and it decided it might leverage its monopoly position, then it would have to screw every access seeker at the same time, or none. The fact is it won’t (and can’t) do that because of legislation, because of the ACCC, and because it’s there to provide an essential service, not turn a profit. I think privatisation is a foolish idea as well, but even then, as you say, it will be tightly regulated, so the situation I just described (screwing every access seeker at the same time) shouldn’t occur. The only difference there is that it takes the revenue stream out of public hands and puts it into private hands. I’m not sure what the rationale for that is.

           I agree that the ACCC’s 121 POI decision was stupid, as it’s terrible for (retail broadband) competition in the long run. One hopes we can get a reversal on that in the future. Having said that, there are so-called ‘demand aggregation’ services that smaller ISPs would be able to piggyback onto to provide national coverage, but obviously the demand aggregator is going to be taking a cut there, so the costs are still higher for a small ISP.

         • I’ve never understood the attraction/benefits for governments in privatising monopoly infrastructure, it always turns and bites them on the arse (like power and water here in Qld….at least they got the water back).

       • @Fibroid
         “In fact you will look back at the era where ISP’s had their own DSLAM’s in Telstra exchanges where fierce competition exists and still does for the ADSL2+ and Naked DSL dollar as being the zenith of BB retail competition.”

         Nonsense. What about when ISP’s had to wait six months or more every time they wanted to get access to an exchange? What about all the exchanges where retail customers can’t get ADSL2+ services due to insufficient port availability with every retail ISP except Big pond, and because Big pond have ports available Telstra can claim there is no capacity restriction on the exchange, while ISP’s can’t physically install any more equipment in the exchange and Telstra refuse to upgrade it (even when ISP’s have offered to pay for the upgrades themselves)? What about service faults Telstra claim don’t exist because their testing methodology is inconsistent with the use to which it is being put, leaving customers with poor or no actual service and reseller ISP’s unable to take any action because Telstra own the copper?

         {sarcasm} No, you’re right, Telstra have never abused their monopoly position, the situation we have today is the pinnacle of fair competition in the best interests of all consumers… {/sarcasm}

         • Totally disagree, competition is fierce at the exchange based third party DSLAM level, the best ADSL2+ deals, especially monthly quota are on their own DSLAM’s, not Telstra’s.

           Also ISP’s offer a product BigPond doesn’t, Naked DSL off their own DSLAM’s, where once again competition on Naked DSL plans is intense with high quota’s and included VoIP calls.

         • Grasping at straws now…

           Telstra’s competitors/wholesale customers accessing Telstra exchanges and using Telstra’s network or reselling Telstra, does not equal actual network based competition.

         • And DSLAM equipment is housed?… In an exchange. And who owns the exchanges? Telstra. And if the racks in the exchange are fully populated, how many more DSLAMs can be installed? None. And can Telstra be compelled by the government to upgrade the exchange if it’s retail competitors have no more space for the equipment? Not as far as I’m aware, and I know of quite a few local exchanges where the only way for people to get ADSL2+ with any ISP except Bigpond is to stand in the queue and wait for other people to disconnect their services. THAT is how you can use your monopoly position to advantage another business unit.

           I note that your response completely fails to even acknowledge the examples I gave. Standard operating procedure for you… How about you answer the questions I posed to you below? Stop making obtuse statements of fantasy that only address specific points you want to pedantically focus on because they suit your argument while pretending other pertinent and compelling arguments haven’t been made. If your argument was so robust you wouldn’t be unable to debate each point as it was raised, you wouldn’t need to pretend things hadn’t been written directly to you. You’re an intellectual coward and I’m sick of your flagrant disregard for the quality of debate demanded on this site by the comments policy. Renai, at what point, precisely, is someone determined to be acting in bad faith by ignoring facts presented by others and beligerantly pursuing their own agenda?

         • I responded, your assertions on Telstra delay had minimal effect upon DSLAM based third party competition and the marketing of the Naked DSL plan, which was a winner and still is because ISP’s have a product BigPond made a business decision not to go ahead with after a brief pilot period.

         • WTH are you talking about? I’m talking about anticompetitive practice by Telstra artificially limiting the availability of competitors’ products. It doesn’t matter how much demand there is for competing products if consumers can’t actually get access to them because Telstra have artificially limited availability.

         • I responded, your assertions on Telstra delay had minimal effect upon DSLAM based third party competition and the marketing of the Naked DSL plan, which was a winner and still is because ISP’s have a product BigPond made a business decision not to go ahead with after a brief pilot period.

           the current situation (sans NBN) only “kinda, sorta” works. The NBN policy wasn’t developed in a vacuum, it’s meant to address the current issues (which is does, very, very well IMHO). It’s wasn’t developed just as “Candy for tech-heads”…

         • And I suppose this never occurred Fibroid?

           http://www.accc.gov.au/media-release/18-million-penalty-imposed-on-telstra

         • Not to him, no ;-)

         • I have referenced that Telstra penalty many times, and the outcomes that resulted from it, but you both know that.

         • Genuinely never seen you do so Fibroid :/

           And TBH, having pretty well read your entire repeating playlist of comments here, I think I’d remember you mentioning this?

           So with any possible respect which is due, I have no reason to and do not believe you… sorry.

     • @Harimau

       +1

   • “$11 billion for access without exclusivity?”

     Exclusivity is mandated by legislation under the labor proposal, exclusivity is forbidden under the coalition proposal.

     “I don’t see a problem with allowing competition.”

     Except of course it completely destroys the business model and leaves the Australian taxpayer to pay the entire cost of rolling out a FTTN network with no users.

     • Why has the FTTN network got no users?

       • I know I wont be a user of it :o)

       • “Why has the FTTN network got no users?”

         Because the coalition policy is to encourage broadband customers to use competing networks.

         The coalitions own argument is that few people would use an FTTP network because they would all go mobile. Certainly far more would go mobile when it can provide far better speed than FTTN by that same reasoning (of course I don’t actually believe this will happen, just pointing out the glaring contradiction in their own policy).
         But the coalition goes further. They will be actively encouraging the roll-out of competing networks and the obvious scenario here is that Telstra will take the money they get for copper and use it to overlay their own exclusive access FTTP network (NBNco is the provider of last resort for data and Telstra will have no obligation what-so-ever to provide wholesale access to it’s network in NBN serviced areas) in the most profitable areas.

         Yes, there will be users on FTTN, but only in areas where providing service is a loss making exercise.

         • @Goresh

           ‘Because the coalition policy is to encourage broadband customers to use competing networks.’

           Well part of Coalition policy is to encourage non-NBN Co infrastructure builds, with very strict conditions on their use and access to be made available to all RSP’s, whether that actually happens or not and what the footprint is we have to see, then we can start making judgements on how many customers actually use it.

           ‘The coalitions own argument is that few people would use an FTTP network because they would all go mobile.’

           That’s not the Coalitions argument.

           ‘But the coalition goes further. They will be actively encouraging the roll-out of competing networks and the obvious scenario here is that Telstra will take the money they get for copper and use it to overlay their own exclusive access FTTP network’

           If they do it won’t be exclusive, all RSP’s can use it at ACCC regulated pricing, just like the NBN Co ACCC regulated pricing.

           ‘ (NBNco is the provider of last resort for data and Telstra will have no obligation what-so-ever to provide wholesale access to it’s network in NBN serviced areas) in the most profitable areas.’

           Yes they do (or any other infrastructure provider) have a obligation to provide access to its network, with strict pricing conditions, it’s in the Coalition policy.

           Why do keep saying Telstra, does that have more emotional impact than any other potential infrastructure investor?

           Optus/ iiNet/TPG could rollout it out, Coles/Woolworths/Vodafone/Virgin could back a rollout?

           ‘Yes, there will be users on FTTN, but only in areas where providing service is a loss making exercise.’

           The NBN Co FTTN is being rolled out to 71% of residences, I have no idea what you mean there will be only residences using it in ‘ loss making exercise’ areas.

         • ‘The coalitions own argument is that few people would use an FTTP network because they would all go mobile.’

           That’s not the Coalitions argument.

           Indeed, the Coalitions argument is that, yes, we need FTTP, but we’ll put that off to a later date and spend $30b getting everyone up to par first, rather than going directly to spending $44.1b getting everyone there the first time ;o)

         • Oh and as to:

           The NBN Co FTTN is being rolled out to 71% of residences, I have no idea what you mean there will be only residences using it in ‘ loss making exercise’ areas.

           While the competing networks Malcolm envisages may have set wholesale prices, that money won’t go the NBN Co…hence the “loss making”…

         • “Yes they do (or any other infrastructure provider) have a obligation to provide access to its network, with strict pricing conditions, it’s in the Coalition policy. ”

           So Optus for instance will be forced to open up it’s HFC and mobile networks for wholesale access at the prices currently forced on Telstra?
           Please show me where it says this in their policy.
           Certainly the ACCC does not currently force nor set prices for access to these networks.

           I would expect legislating to allow forced access to private property at governemnt mandated rates would be unconstitutional.
           The ACCC can set rates for access to Telstra fixed line because, at the time the legislation was enacted, Telstra was a government owned company and was sold off with the required legislation already in place.
           If it were so easy, there would not be a USO levy on the carriers, the government would simply direct them to provide services at a loss.

   • I live in a city, but I need people to live in the bush, I need them to grow my food, I need them to mine the raw materials to make the products that I use. And as such I’m prepared to subsidise people living in the bush due the contribution they make to my life, I do this by paying tax. I also do this by paying a little more for utilities such as telecommunications, so that they can pay the same as me, which is a lot less than the cost of providing services to them. I have no problem with this because ultimately we’re all better off with this arrangement.

     If we move to a user pays system for everything, then we will all be worse off.

4. Whether the copper is currently owned by the company deploying FTTN or not is irrelevant. The copper has a certain value, you purchase it for that value and then you’re the company with the preexisting infrastructure.

   As you state, deploying FTTN is good logic for companies with copper since they can push that copper to its maximum value before it becomes obselete. Maintenance costs are already take into account here. Overseas companies are keeping their final stretches of copper because the mainenance costs are not high enough to eliminte their value. No reason to think we’re any different.

   Competition may reduce prices in high density areas, yes, but I can’t see how it will increase prices in other areas.

   I can’t see how the Coalition NBN would have problems with wireless deployment. Please enlighten me?

   • Whether the copper is currently owned by the company deploying FTTN or not is irrelevant. The copper has a certain value, you purchase it for that value and then you’re the company with the preexisting infrastructure.

     Thats actually the point he was making. If the liberals have to purchase the copper, you can add that to the $29.5b they are already spending. If it raises the cost so it’s the same as the NBN, then whats the point of doing it when it will then need to be upgraded at some time in the future (as even Malcolm has said).

     As you state, deploying FTTN is good logic for companies with copper since they can push that copper to its maximum value before it becomes obselete. Maintenance costs are already take into account here. Overseas companies are keeping their final stretches of copper because the mainenance costs are not high enough to eliminte their value. No reason to think we’re any different.

     Many of the overseas companies are either now rolling out FTTP, or planning to. FTTN isn’t the “end game”, FTTP is.

     Competition may reduce prices in high density areas, yes, but I can’t see how it will increase prices in other areas.

     I guess you haven’t lived or spent much time in “the bush” (or even fairly close rural areas). Things like increase in transport and logistics costs, and less competition all keep prices up out there. Once a network is laid however, there should be no price difference (even though Telstra used to charge people “out there” more).

     • @Tinman_au

       ‘Thats actually the point he was making. If the liberals have to purchase the copper, you can add that to the $29.5b they are already spending.’

       Putting aside you key ‘if’ condition you mentioned, so you add the $11b to the $44.1b Labor will have to spend, or do you only add things together when you look at Coalition funding?

       ‘ If it raises the cost so it’s the same as the NBN, then whats the point of doing it’

       So what ‘same as the NBN’ cost are you referring to here $44.1b or $44.1b +11b, or is it the what may be the revised funding requirement in the new 2013 NBN Co Corporate plan we won’t see this side of the election, it mustn’t contain much good news otherwise Labor would rush it out with the ink still wet.

       ‘Many of the overseas companies are either now rolling out FTTP, or planning to. FTTN isn’t the “end game”, FTTP is.’

       Really? – with recent advances in FTTN technology beyond VDSL2+ many companies including those already committed to FTTP are revisiting FTTN again, but let’s not mention that.

       ‘Competition may reduce prices in high density areas, yes, but I can’t see how it will increase prices in other areas.’

       I have asked this before, the ACCC will allow this because…..?

       • If labor needed the copper in the ground after FTTP was built, they too would need to buy it.

         Tell me Fibroid, does the FTTP network need the copper in the ground? or can Telstra pull it up and sell the copper?

         I would 100% support putting the cost of copper onto the Labor budget if it relied upon its existence.

         • The Labor Budget as you put it certainly ‘relied upon its existence’ ie the copper being there, the ultimate aim being to shut it down, otherwise the $11b payout to Telstra would be much less, just as it relies on the HFC BB being there, because once again the $11B would be less if the Telstra HFC BB wasn’t to be shutdown.

         • Wow… Groundhog Day… again

         • LOL

         • Wait, what??

           Labor did the deal just so they could shut copper and HFC down? That about the most ridiculous statement I’ve seen you make…

         • wait what? Compensation for the shutting down of the Telstra copper and HFC BB are not key components of the $11b deal?

         • Thats right, there is compensation in it to transfer customers, but nothing at all to decommission them.

           You still haven’t read it, have you?

           I’ll give you there link (again) http://www.telstra.com.au/abouttelstra/download/document/Explanatory-Memorandum.pdf

         • So what’s Telstra going to do with the copper and HFC BB if it is contracted to use NBN Co fibre exclusively for fixed line for the next 20 years, move all their customers back to exchanges that have had all the PSTN gear and DSLAMs removed long ago at the end of the 20 years in 2031?

         • You’d have to ask Telstra, it’s their copper…

           HFC will continue to be used for cable TV however.

         • OOOH!!

           So the labor government is going to be able to sell the copper on the copper market then!!

           Thanks for clearing that up fibroid.

       • As usual Fibroid, you do enjoy demanding other people answer your questions when you consistently ignore everything inconvenient to your preexisting ideology.

         You keep talking about the $14bn difference in cost between the NBN and the LNP’s proposed alternative, and object to the $0.9bn difference in actual Government commitment. But the reason 0.9bn is used is because it is the only direct comparison that can be made when the Coalition haven’t released figures for the estimated private investment component of their network – MT has only said that would need to be determined after they’re in Government. We do know that according to Mr Abbot the LNP plan includes costs to deploy ‘about 20,000’ nodes, while MT believes it to be around 50,000, but realistic estimates from experts put the figure closer to 70- or 80,000, even higher if you’re trying to ensure every premises is within 500m of a node (which is the only way you’ll get 50mbps over even the best copper we have in the ground for last mile connections within the existing CAN). Given how expensive node cabinets and included equipment are, how do you think a blow out of 30% (at best) in the number of nodes required will affect the cost of the LNP FTTN network?

         Sticking with the difference in cost argument, I have repeatedly raised the point for months, that revenue under the FTTN network must necessarily be lower than the FTTH NBN while operating costs must be higher. To revise, increased infrastructure competition will reduce market share, an inferior product with less utility to the customer will result in weaker demand (lower sales) and without high profit premium performance products ARPU will be lower on FTTN – so you have fewer sales and from each of those sales you make less money for each one. Because of the costs of powering the network equipment in node cabinets you have additional costs to operate FTTN over FTTH resulting from that electricity usage. You also have to maintain the copper network, resulting in increased maintenance costs of maybe 1bn per year on top of comparable costs to operate FTTH.

         So if you have significantly reduced revenue and increased costs to operate FTTN, the Coalition runs the risk (an extremely likely risk) of not being able to achieve positive ROI at all. If they can’t generate a profit, the $29.4bn of LNP Government expenditure becomes on-budget expenditure, with an additional cost to the government (and a direct cost to the taxpayer) every year thereafter from operating expenses. Not to forget the annual interest cost from a loan that will need to be paid out of the budget ASAP to avoid a spiralling black hole of debt.

         So please explain, Fibroid, how the LNP FTTN network costs less than FTTH when FTTH will cost the government (and thus tax payers) $0, while it is likely (as in, the most probable future outcome) that the Coalition FTTN network will cost the government and tax payers $30bn plus $11bn minimum cost to Telstra plus interest plus annual operating costs (after they’ve been reduced by the income that they actually do make)? I see at least $41bn deficit in initial deficit in there. How the f#&@ can you justify fiscally irresponsible policy like that?

       • Putting aside you key ‘if’ condition you mentioned, so you add the $11b to the $44.1b Labor will have to spend, or do you only add things together when you look at Coalition funding?

         Considering the $11b is a “done and dusted” deal, it applies to both anyway…

         So what ‘same as the NBN’ cost are you referring to here $44.1b or $44.1b +11b, or is it the what may be the revised funding requirement in the new 2013 NBN Co Corporate plan we won’t see this side of the election, it mustn’t contain much good news otherwise Labor would rush it out with the ink still wet.

         The costings from NBN Co are a lot more realistic than Malcolm’s (considering Malcolm doesn’t actually have any actual costings).

         Really? – with recent advances in FTTN technology beyond VDSL2+ many companies including those already committed to FTTP are revisiting FTTN again, but let’s not mention that.

         I’d love to hear which overseas companies have canned their FTTP rollout because of “recent advances in FTTN technology”, can you provide me a link?

         I have asked this before, the ACCC will allow this because…..?

         If the ACCC has power over the increased costs to “the bush”, why haven’t they done something about it before? Oh, yeah, I guess “distance” can be something that they agree increases the costs…

         • @Tinman-au

           ‘Considering the $11b is a “done and dusted” deal, it applies to both anyway…’

           Yes I know.

           ‘The costings from NBN Co are a lot more realistic than Malcolm’s (considering Malcolm doesn’t actually have any actual costings).’

           Yes I like the NBN Co’s ‘realistic’ costings as well, it’ s hard to know which ones are actually ‘realistic’ though because they keep changing, and no doubt will change again in the 2013 plan we have yet to see, but Malcom’s are worse , I guess he should have changed them since April , it doesn’t seem to matter if he increased them as long as he changed them.

           ‘I’d love to hear which overseas companies have canned their FTTP rollout because of “recent advances in FTTN technology”, can you provide me a link?’

           I didn’t say they have canned their FTTP sellouts in favor of FTTN , I said they were evaluating advances in FTTN technology and BT for one has changed the priority of their rollout from FTTP to FTTN.

           ‘If the ACCC has power over the increased costs to “the bush”, why haven’t they done something about it before? Oh, yeah, I guess “distance” can be something that they agree increases the costs…’

           NBN Fibre Plans cost more in regional areas? – what increased costs to the bush are you referring to?

         • Yes I know.

           And yet you still “tried it on”. That says a lot about you, you know.

           Yes I like the NBN Co’s ‘realistic’ costings as well, it’ s hard to know which ones are actually ‘realistic’ though because they keep changing, and no doubt will change again in the 2013 plan we have yet to see, but Malcom’s are worse , I guess he should have changed them since April , it doesn’t seem to matter if he increased them as long as he changed them.

           You know that in the “real world” actual private companies plans change too, yeah? Any actual enterprise have to be flexible, or it goes under. Malcolm has been promising “more” (more nodes, new add-ons like vectoring and G.fast, etc) but hasn’t changed his plan costings at all. That doesn’t work in “the real world” and makes me wonder how dodgy (as in done for political gain only) his plan really is.

           I didn’t say they have canned their FTTP sellouts in favor of FTTN , I said they were evaluating advances in FTTN technology and BT for one has changed the priority of their rollout from FTTP to FTTN.

           Oh, so you weren’t actually addressing my point, you were waffling about something else. Fair enough.

         • Yes it’s amazing how pro NBN supporters are entirely comfortable with the multitude of changes in the six years since the Labor NBN policy for Fibre to the Node pre election 2007, and then the two Business plans and the rollout downgrade in April this year with a third Business plan waiting in the wings.

           But if the Coalition don’t get it right the first time as per their April policy announced well before they are even in Government they will have hell to pay.

         • No, I’d be OK with the Coalition changing their financials as well, in fact it worries me that they haven’t, even though they’ve been “tweaking”…

         • Plenty of time Tinman-au , assuming a win in a week or so they have six years of ‘tweaking’ ahead of them.

         • And the nasty truth will rear its ugly head.

         • Since mid-2007 (one of your fav years to discuss) the current government have simply gone from FttN to FttP, after heeding expert advice.

           Whereas the current opposition (former government) have gone from…

           * Calling FttN fraudband.
           * To signing up for WiMAX (now there was a future proof technology…) in the bush with the status quo/or fraudband but by a private company in the cities.
           * To claiming wireless is the future, FttP is a waste and will be obsolete before it’s rolled out.
           * To considering their own FttN (or rather fraudband).
           * To again agreeing wireless is the future Alan, FttP is wasteful and will be obsolete etc…
           * Back to and also suggesting they will adopt their own FttN fraudband…

           and finally the music stopped in April (iirc) of this year and MT sat down on the (drum roll…) FttN fraudband but with “wasteful’ (their words) FttP in certain areas, chair…

           If it wasn’t so serious it would be downright comical…but nothing like conviction eh?

           Well… I suppose in a way they do have conviction… a conviction to do anything they have to, to avoid doing it the best way. And why? Simply because the others did it properly first and they can never admit the others actually did it properly, can they?

         • Plenty of time Tinman-au , assuming a win in a week or so they have six years of ‘tweaking’ ahead of them.

           Are you going to hold the LNP to the same standards with their plan, should they win, that you’ve held the NBN to?

         • @Alex

           If it wasn’t so serious it would be downright comical

           I actually see this as a massive problem for them, they’ve been setting the tone for the last three years that they will also have to live with.

           They are only just recently starting to realise that, which is why all the “economy in crisis”, “budget emergency” and “Surpluses are easy, just vote Liberal” crap is starting to disappear from them. They also haven’t bothered too much with their own policies (Malcolm as an outlier here), which is why there’s also so many “Me-too” policies coming from them (which amusingly is swinging them a lot to the left)…

         • The major difference is that Labor had the idea and went on to put into practice. So, adjustments had to be made.

           The Coalition, went from “nothing” to “detroy the NBN” , ” we don’t need it “and finally or should we say belatedly to “We can do it better, faster and cheaper”. This last incarnation was a big call and they are coming short.

           The problem with the Coalition is that many of their policies are “me-too” policies (education, aged care, disability, Health…) the main issue is that because they don’t have the conviction to begin with, they look for shortcuts.

           With the NBN, after telling us they could do it for a quarter or a third of the price, they offered a cap and, then, resorted to artificially inflating the price of the NBN to make it fit to their initial bullshit.

           The only people who still buy it are the rusted-on faithful like yourself. The ones, who if they saw Abbott in a debate, not saying anything for minutes (as he once did in answer to a question), would still claim that he won the debate hands down.

         • The problem with the Coalition is that many of their policies are “me-too” policies (education, aged care, disability, Health…) the main issue is that because they don’t have the conviction to begin with, they look for shortcuts.

           The real irony is that most of the “me-too” stuff they are doing goes pretty well against the grain on their usual post-Howard policy/ideology, it’s almost like Malcolm Fraser is back in charge. They are even “biting” small-medium businesses by saving $900 million through axing a measure like the tax loss carry-back and of course the 1.5% levy on the big end of town and shareholders (mostly older Australians and super companies).

           It’s almost like they are trying to turn into Social Democrats (though the proof of the pudding is in the eating as they say, I’m not sure this particular leopard will retain it’s “spots” after the election).

         • “It’s almost like they are trying to turn into Social Democrats”

           This is all for the purpose of getting elected. The audit after the election will take care of all the anomalies. The crucial point, if they win. is the size of the win. This will determine the amount of backflip on policies.

           I must say that the scenario which would enormously appeal to my sense of humour would be a minority or a narrow win for Abbott. It would be nice to seem at the other end of the stick and see how much he enjoys it.

         • Actually, Liberal Governments are nearly always “Minority” Governments, they cannot govern in their own right but need to form a coalition with another minor party, the National Party.
           That is why TA stating he would not form a minority government is B.S every NLP Government is technically a minority government

         • As Carl Sagan used to say, extraordinary claims require extraordinary evidence. We haven’t seen extraordinary evidence from the Coalition, we’ve seen policies without costings and election promises without proposed legislative underpinnings. Further requests for additional details have simply been met with ‘go and look at our policy documents’, when that’s what has been done which found those documents to lack the required detail.

       • “Putting aside you key ‘if’ condition you mentioned, so you add the $11b to the $44.1b Labor will have to spend, or do you only add things together when you look at Coalition funding?”

         The $11 billion is already included in the NBNco plan. It is already included in the coalition plan also.

         The additional cost of acquiring and remediating the copper does not occur in either plan because it simply isn’t required for FTTP and for the coalition plan it would increase the cost to more than FTTP so it was intentionally left out.
         Malcolm assumes Telstra will give it away free (and the execs happily serve their jail sentences for gross dereliction of their duty to their shareholders) for the simple reason that if he doesn’t, then nothing he says adds up.

         I can assume that the bank will simply give me the money I want for my new investment property, but I doubt that they will actually accept a business plan based on it.

   • “The copper has a certain value, you purchase it for that value and then you’re the company with the preexisting infrastructure.”

     Excepting of course, the company that already owns the copper owns it outright.
     The company purchasing the copper has to borrow the money and pay interest on it.

     And of course, the elephant in the room is that the company that just sold it’s copper will use the money to overbuild the copper with fibre and crush the competition out of existance with their new, taxpayer funded but privately owned, ubiquitous FTTP network.
     Of course, only the profitable areas will be overbuilt, leaving the taxpayer to pick up the cost of all teh unprofitable areas and the ongoing cost of maintaining the overbuilt areas with no customers on it.

5. If I was Telstra I would take that money the Government pays me for that old copper network and build a Fibre network right next to it in areas that profit me most. Hence making the coalition NBN obsolete or they will have to upgrade it to compete. Oh wait, they do that now with Velocity and against their own copper network.. Hmmmm. That’s my understanding.

   • As a Telstra shareholder, if they DON’T do this, I will be seeking to replace the board and CEO at the next AGM.

6. This key comment from the analysis above?

   “Labor’s FTTP network will provide the necessary infrastructure for this expected expansion of the wireless network, but the Coalition’s lower-cost FTTN network will not.”

   Can anyone explain how this difference works and how rollouts of FTTN overseas is having a drastic effect on wireless network capacity?

   • Is that a joke? He doesn’t say that FTTN prevents wireless expansion, he says that FTTP (effectively, fibre everywhere) enables more wireless expansion (because of more fibre backhaul). So it’s not that FTTN has a negative effect, it’s that FTTP has a positive effect. Although, interpreted another way, as FTTP is currently being rolled out, FTTN foregoes that positive (and is therefore negative), while FTTP maintains that positive (and is therefore neutral).

     • @Harimau

       But there is fibre backhaul involved in FTTN there is also fibre backhaul out of Telstra exchanges, ISP’s use third party backhaul to support their exchange based DSLAM’s and purchase more capacity if required.

       Telstra and Optus and to lesser extent Vodafone are rapidly increasing the capability of their backhaul capacity for 4G and increased mobile use all over Australia, I am not aware the wait for NBN Co FTTP (backhaul) to suburbs and homes all over Australia is inhibiting that growth.

       “We can’t upgrade that tower back haul capacity yet ,we have to wait for the NBN rollout to hit that postcode”

       and….

       “I hope the Coalition don’t get in, the FTTN will inhibit wireless backhaul capacity”

       Really?

       • Uh, where do those quotes come from?

         I don’t really care about wireless, you’re the one who brought it up. I’m just pointing out that you brought it up for the wrong reason.

         • The point is it doesn’t matter if FTTP or FTTN is rolled out it will have zero effect upon wireless backhaul capacity, the carriers fiercely competing for the punters wireless mobile and BB data dollars which increasingly are a major portion of their company revenue are not waiting for any residential fixed line BB rollouts to help them with their capacity upgrades.

         • “The point is it doesn’t matter if FTTP or FTTN is rolled out it will have zero effect upon wireless backhaul capacity”

           Hey mate, this is factually inaccurate. The mobile carriers have plainly stated that they will be taking advantage of the NBN’s increased backhaul.

           I’ve received a few complaints about your posts over the past several days, so I’m placing you on a pre-moderate list. I’ll need to approve any comments you make. Those containing demonstrably inaccurate statements will be deleted without notification.

           Renai

         • The mobile carriers have plainly stated that they will be taking advantage of the NBN’s increased backhaul.

           I still wish NBN Co had included microcells/picocells in their plan, they could have almost eliminated all mobile blackspots in Australia (if you read this Albo, give it some thought!! http://en.wikipedia.org/wiki/Femtocell).

         • Renai,

           ‘Hey mate, this is factually inaccurate. The mobile carriers have plainly stated that they will be taking advantage of the NBN’s increased backhaul.’

           I have no doubt they will and I didn’t say they would not take advantage of it, the point is how does a NBN FTTN rollout vs a NBN FTTP rollout significantly differ in this intended wireless backhaul use.

           It’s genuine backhaul methodology technical question I would really like to know the answer to.

         • The only thing I can think of is the FTTN backhaul doesn’t actually need to be as high as FTTP, as funnelling in a bunch of 25Mbps streams requires less than the same number of 100Mbps streams (regardless of whether everone takes 100Mbps plans, they still need to provision for it).

         • @ Fibroid

           “It’s genuine backhaul methodology technical question I would really like to know the answer to.”

           And as a question it would have been a decent one.

           However your’s wasn’t a question was it? It was a statement where you were telling us “it will have zero effect…”

           So why now try to pass it off as a question, when it clearly wasn’t?

           None of my business perhaps… but I find with some posters here, that this occurs regularly and when quizzed about such statements the goal posts are inevitably moved (like here) and then the strawman normally enters.

           This type of commenting IMO, is disingenuous and doesn’t augur well for meaningful and courteous correspondence.

           Cheers.

       • “I am not aware the wait for NBN Co FTTP (backhaul) to suburbs and homes all over Australia is inhibiting that growth.”

         You are a telecommunications systems engineer and in a position to actually know anything at all about this?

         I expect you will find that 4G reach is similar to fibre cable reach (whether owned or leased).

   • I’m not too sure on that either, unless he’s referring to Femtocells and forgot to mention that.

7. Maintenace Fees is 1B a year.. Line rental charge is 10.5 million activelines * $25/m * 12 months = $3.15B a year.

   By keeping the copper you make a nice $2.15B profit a year

   • There won’t be line rental under either FTTH or FTTN as we currently know it, so that statement is erroneous.

     • Until we know what deal Malcolm does with Telstra, the FTTN part of that is conjecture, isn’t it? Or has Malcolm explicitly ruled it out?

       • With either FTTH or FTTN you have a contract with a retail ISP. The physical characteristics of the network, the owner of that network and what deals have been done to construct or provision that network are transparent (and irrelevant) to you – voice services will no longer occur over the existing copper network as they will all be digital over the network. Thus no line connection in the traditional sense – it will simply be a single subscription service with an ISP regardless of whether or not that subscription includes a voice service or not.

         I’m all for shining the light on vague unknowables, but even allowing for the possibility that the LNP FTTN plan could attempt to introduce additional end user costs in a desperate attempt to balance their runaway black hole of fiscal mismanagement, I can’t see how line rental could even be possible in a FTTN world – it is simply unheard of.

         • Well, BT do charge an annual line rental: http://www.openreach.co.uk/orpg/home/products/pricing/loadProductPriceDetails.do?data=yzq%2FQaGYa3hVgsB2ZYfjHxzfISuq3px%2FWFtgATP2kPRZ6rNZujnCs99NbIKJZPD9hXYmiijxH6wrCQm97GZMyQ%3D%3D

           Doesn’t mean that Malcolm will though

         • Actually, BT also charge 456.00 pounds a year line rental on fibre as well….

         • I think you know what he means though. Not “line rental” as it is now. Yes, both have a connection charge.

           It is whether any, and how much, money goes to Telstra for each one of those connections. Whether it be in the form of a payment per line, or a maintenance contract that sees them making a profit. How much in non CAPEX money is going to flow to Telstra as part of a FTTN plan.

           The copper might be got for nothing, as a loss leader, but there is a chance it’s paid for in other ways.

         • For what it’s worth, Telstra still charge “line rental” on South Brisbane Fibre, wether or not you actually want a phone service. There is off course no actual phone line. So this sort of thing is not unheard of.

     • “There won’t be line rental under either FTTH or FTTN as we currently know it, so that statement is erroneous.”

       Of course not, it will be called something else. NBNco call it Access Virtual Circuit (AVC) and charge about the same as Telstra line rental (what you think the pricing was just a coincidence), but it serves the same purpose, it is the cost of having a basic connection.

       • It may serve the same purpose, but the impact to end users is quite different – today on ADSL over a copper line you pay $25 line rental plus your Internet plan (I’ll use the example of an iiNet plan of $50, which includes 200MB download quota per month). Under FTTH you no longer pay the line rental, just the ‘broadband subscription’ – comparing the example above, you can be on the lowest speed tier of 12/1mbps with the same 200MB quota for $60, a $15/month saving compared to the nearest ADSL plan. An extra $5/month more than doubles your speed to 25/5. $10 extra gets you 50/20 at the same price you would have paid for your phone and Internet on copper and ADSL. Just $5 more gives you twice the performance again at 100/40. If (like me) you have additional line services such as caller ID (such a massive rip off) for an extra $6/month, you would actually save $1/month overall going from line rental on copper with ADSL (my usual sync rate is 8mbps, but sometimes drops as low as 2mbps) to the same quota on 100/40.

         So yes, while there is service provisioning, as far as end users are concerned line rental is relegated to the annals of history. There is no evidence to suggest that this would be any different under FTTN (although there is some suggestion plans would cost more for the same quota at significantly lower speed compared to FTTH).

         • “It may serve the same purpose, but the impact to end users is quite different”

           I never said that the deal for teh end user wasn’t better, only that the line rental model never went away.
           A rose by any other name…

8. I still find it hillarious that any tech experts can back Coalition’s NBN when it’s just a DSL network, technology of the past.

   The whole “FTTN vs FTTP” argument is one big joke – why do consumers even care about backhaul, which is the only fibre part of Coalition’s NBN.

   Labor really missed an opportunity here and should have lebeled the alternative NBN as what it truly is from day 1, xDSL vs Fibre, NOT FTTN vs FTTP.

   • Every time Labor refers to FttN as ‘last century’s copper’ they get smashed by the MSM. Using xDSL would do the same thing – it IS disingenious to use that line, as its not xDSL, but FttN. Which is definitely a step forward.

     What I’m saying is that they are basically already calling it xDSL, by emphasising the reliance on the copper portion, without giving any respect to what will be the fiber portion.

     • FTTN is the network design. xDSL is the transport protocol. They are different things.

     • “its not xDSL, but FttN”

       The protocol used between the node and the customer IS xDSL.
       The coalition appears to be planning to used VDSL but that in no way changes what it is.

       The customer will have a bog standard xDSL modem in their house.

9. The one main points of the article I thought was that the cost proposed by the Coalition are unrealistically low. So, something will have to give. Will it be what the budget affords or will it be what is promised but at a much higher cost?

   The other was that any competition, as desired by the Coalition, can only be in highly profitable areas. This, no doubt, would have a huge impact on the ability of NBNco to recover cost as quickly as the current model allows.

   I was wondering if these well argued points would be enough to keep Fibroid away from the discussion. But never fear, here he is arguing minor points that detract from the important ones. I am surprised? Of Course no.

   Luckily, only a week and a half to go before the election. I hope that, then, we will be rid of the endless nitpicking.

10. “An example of facilities-based competition is the parallel hybrid-fibre-coaxial (HFC) networks owned by Telstra and Optus that run alongside each other on the power poles in many suburban streets in Sydney and Melbourne.”

    A much more obvious facilities-based competitor, and the elephant in the room when Turnbull claims he will get the copper for nothing, is that Telstra’s existing copper network would be a very powerful and ubiquitous competitor for any FTTN network, if only the government had not resumed it to build the FTTN!

    The copper is indeed only worth it’s scrap value minus recovery costs when up against a universal FTTP network, it is very valuable indeed against or part of any FTTN deployment.

11. Labors NBN is also not good enough. 100% fibre coverage not 93%, and proper active point-to-point fibre rather than shared passive fibre is the way to do it properly, and will be most future proof. It would also mean, those who’re wealthy enough, could upgrade their links to 10Gbps or 100Gbps if they’re willing to pay for the equipment on the ends of their dedicated fibres.

    If people argue this is unrealistic and too expensive, see the above article.

    • With the current NBN plan future profit beyond complete cost recovery means the revenue stream to the government could be used for further network expansion at zero cost to tax payers (even zero interest if they wait to accrue a fund large enough to cover expansion costs). No, it’s not the best network that could have possibly been built, but it is an enormous step forward, is fairly easily upgraded and is cost neutral to upgrade in the future.

      • No, it’s not the best network that could have possibly been built, but it is an enormous step forward, is fairly easily upgraded and is cost neutral to upgrade in the future

        I have no doubt what so ever, that at some time in the near (as in years) future, there will be complaints that it wasn’t enough :o)

    • “Labors NBN is also not good enough. 100% fibre coverage not 93%,” — a noble goal. One that can be reached with Labor’s plan but not LNP’s. To me at least its a key weakness of FttN. It adds a further hurdle to the technology we already know is going to happen.

      The argument for FttN is to leverage off existing tech that little more. So I expect the same logic to apply to FttN, in which case it will be to build FttH as the next stage. Pretty simple. But that just puts us several more years away from FttH being the default, and its only then that you can focus on covering the last 7%,

      I suspect that a FttH rollout will gradually expand to cater for much of that 7%, as NBN Co is turning a profit and able to direct that profit towards the remaining 7%. FttN will need to deal with 71% of users on FttN before it worries about them. Or at least the vast majority of them.

      How it will work with the final 3% on satellite, I have no idea, as the cost is prohibitive to run fiber the whole way, but at some point in the future I imagine all homes will have a full fibre run. Its just a matter of when for some of them at the extreme edges of capability.

      To put it another way, someone has to be last, and in the interests of cost effectiveness for the greater portion, the 7% is going to be it.. Who knows, it could be incredibly cost effective to run single user fiber lines by the time they are the only ones left.

      • Well they all got copper eventually, so if you can justify running a copper line you can justify running fibre, eventually, with the upside that the fibre will be able to carry services for maybe hundreds of years

        • The 7% are the problems, is the point I’m making. Break that down into the 4% on fixed wireless, and 3% on satellite, and one is clearly easier to manage than the other.

          Most of the 4% fixed wireless would actually be highly appropriate for FttN, which is one of the areas Labor’s plan can be improved. A lot of those small townships are clustered so small a node (or 2) in a central location can service the lot. Much better proposition than wireless with its congestion issues.

          And once you look at a small township as FttN capable, its relatively easy to upgrade them to FttH.

          Those wont be the problems for the most part, its the remaining 3% that arent clustered, or so far away that any rollout is at a prohibitive cost. Do you absorb those exceptions into the final costs, or do you look for alternatives?

          All I’m getting at is that while 100% is a noble goal, there will always be issues that make the last couple of percent relatively difficult. So is 97% a fair goal, in which case its just the fixed wireless clusters needing to be addressed?

          100% isnt a realistic goal. But 97% is. For both plans.

          • I can’t find the numbers at the moment, but getting the 7% on fibre as well pretty well doubled the cost of the project from memory.

          • I’m in complete agreement, for the initial rollout. But I would like to see fibre run to that last 7% eventually. Like I said, by all means, wait until accumulated profit from the NBN is such that it can cover further fibre deployments. Even if it costs another 45bn, I don’t see that as a huge problem if NBN revenue is sufficient to cover it. We need to consider the importance of getting the same level of ICT services to all of regional Australia in the same way that it was crucial to get them phone services early last century. The job just isn’t done unless all Australians have the same opportunities in fundamental infrastructure. We don’t begrudge them water or electricity, so why the opportunities for communications, business and education?

            Which, of course, is all a moot point if the Coalition gain power.

          • Trevor
            It took 90 years to get that copper pair to most premises, even then some have some wireless and satellite in the circuit

        • Well, at least until they sort out commercially viable Quantum communication for wireless wide-area networks

    • “100% fibre coverage not 93%”

      The problem is price goes up exponentially as you approach 100%.

      It is not possible to provide a 100% service. Some services would cost 10’s of millions each to connect to fibre. Imagine an isolated property, 1000km from the nearest existing fibre connect point.
      Conservatively you would need $20 million to lay the fibre, about 70 powered repeaters along the way, we will say solar since there wont be existing power of any kind, about $250k a pop, say another $17.5 million, along with sundry costs lets say $40 million per connection. Now lets multiply that by the thousands of remote properties like this and we are well in excess of the total budgeted cost of the 93%.

      In the real world, there is a finite amount of money to be spent on an infinite list of demands and a line has to be drawn and sadly, that means some people will fall just the wrong side of that line.
      Whether it is the number of dialysis machines at the hospital or how many people must live near each other to get fibre connections, somebody has to miss out.

12. As far as I’m concerned, the Liberal alternative is just a waste of time and money – They might as well leave it as is.
    Either do the job correctly or forget about it – dont waste the time and money.

13. You can’t argue value for money if the ‘best value’ solution is out of your price range, its that simple.

    I might get the best value for money and ‘possible’ returns on investment in the housing sector if I get mortgaged up to my eyeballs and buy into the 3 million + bracket; but when it comes time to sell if there are no buyers i’m totally screwed aren’t I.

    The coalition didn’t even want to employ an NBN strategy…period, but blind public demand meant they had to present a model of some sort, its our own fault. We should have supported the coalition more before they were forced to put in a competing strategy and no money would have been ‘wasted’ at all.

    • We’ve had decades of the “do nothing” approach, it’s time to fix it, even if it is the crap Liberal version ;o)

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