news Giant US telco Verizon has launched a 300Mbps broadband service with unlimited data quota included that uses the same fibre to the home technology as the National Broadband Network, stating that homes with multiple devices using high-bandwidth applications simultaneously need the extra speeds.
The telco has since 2005 been offering up to 150Mbps speeds on its FiOS network, which currently boasts some 3.8 million customers. It stretches across a number of major cities, reaching some 13.7 million homes in total, with the company planning future rollouts to a further 5 million homes. The company has previously offered 12Mbps, 25Mbps, 35Mbps and 150Mbps speed tiers, with upload speeds ranging up to 35Mbps.
However, in a statement issued on Wednesday this week, Verizon said it was responding to “consumer demand” for ultra-high-speed broadband services, and so would offer the new speed tiers.
“The new speeds, to be offered in stand-alone and bundled packages, are designed to address the burgeoning growth of bandwidth-intensive applications and the increase in the number of Internet-connected devices being used simultaneously in the same household,” the telco said. “The speeds will also support consumers who are watching more over-the-top video programming on TVs and portable devices, and accommodate the rise in Internet-enabled applications like video and audio streaming, home monitoring devices, video chat, multiplayer gaming and online backup services, all of which can simultaneously sap the strength of many home broadband connections.”
Bob Mudge, president of Verizon’s consumer and mass market business unit, characterised the broadband speed increases as a “societal and technological necessity,” as secure network applications enable consumers to enjoy a “borderless lifestyle” in which they can connect to the content they care about, anytime and anywhere.
“The ways we used the Internet and watched TV over the past 10 to 15 years have dramatically shifted,” said Mudge. “With the emergence of smartphones, smart TVs, Blu-ray players, tablets and gaming consoles that also serve as over-the-top devices, consumers need more bandwidth to receive the highest-quality experience.”
Verizon said the higher speeds would provide customers with “sustained speed and reliability of service”. In contrast, the company said, rival companies operating HFC cable networks only offered “intermittent speed boosts” as their networks were not completely fibre-optic.
“Our top FiOS speed will be twice as fast as anything America has ever seen,” said Mike Ritter, chief marketing officer for Verizon’s consumer and mass market business unit. “High-speed Internet no longer is just for techies, as more than half of our residential consumers already use at least a 20Mbps Internet connection. Streaming online video on an all-fiber-optic connection providing faster speeds is better and more reliable during peak Internet usage hours.
“As recently as 2005, video was less than 10 percent of Web traffic,” said Ritter. “By the end of this year, we expect it to be 50 percent, growing to 90 percent in just a few years.” Today, the average home has seven Internet-connected devices. With the continuing increase of devices in the home using a wired or Wi-Fi Internet connection, the average home by 2015 will have between nine and 15 Internet-connected devices, said Ritter.
Verizon currently charges its customers between US$74.99 (for its 24Mbps plan) and US$199.99 (for its 150Mbps plan) for its fibre to the home broadband services, and it also has additional bundled packages featuring telephone and video services. It is not as common in the US for telcos to set quota limits on broadband downloads, unlike in Australia, where it is more normal for such limits to be set. NBN Co plans to eventually offer services up to 1Gbps on Australia’s own NBN, but the network is currently limited to 100Mbps.
opinion/analysis
It’s interesting to see that US telco Verizon, which has many millions of fibre to the home customers, believes both that they’re demanding speeds up to 300Mbps, and also that they’re willing to pay several hundred dollars a month for such broadband speeds.
This kind of thinking — which I think is not too far from the commercial reality in Australia as well — runs directly contra to the kind of limited thinking around the NBN fibre in Australia that dominates so much of the debate. Clearly, there is demand for these kinds of services from a similar customer base in the US, and just as similarly, those customers are willing to pay top dollar. This is something which I think the Australian telecommunications industry needs to pay attention to.
This is not future prognostication. This is a real company, with a similar customer base to the NBN, with exactly the same technology, and with millions of existing and active connections. The similarity to what Australia is planning locally — even down to the comparison with the HFC cable networks — is pretty exact, apart from the fact that Verizon is not an infrastructure monopoly — it has competitors, such as the aforementioned cable networks. And Verizon is thinking about the future — not about how many of its customers merely want to buy basic voice telephony services.
Image credit (table): Verizon
300/65 and unlimited data? I’m officially jealous.The NBN will eventually bring us just as great speed of course, but I hate the fact that data caps are the norm in Australia. I’m finding 150GB a month restrictive on ADSL2, so I’m going to need 4x that on a 100mbps plan.
I know Simon, how unfair hey? Except they’re bound to cut back, as they’ve started doing on mobile already.
Sure, as we all know, fibre can handle WAY more throughput than mobile wireless, but keeping up with backbone and hardware that can handle that will be pretty pricey if they’re all still unlimited in a few years when video REALLY takes off.
Great example of what I keep saying to people though- Just because YOU don’t use or want 100Mbps, doesn’t mean there isn’t a roaring market out there for it.
To echo Michael….You listening Malcolm?!
“Verizon said it was responding to “consumer demand””
Listening Malcolm? You FTTN isn’t going to give us this. Ever.
@Micheal Wyres
Verizon certainly is responding to consumer demand but let’s get some perspective on where the true demand is in the USA, the may well have 3.8 million FiOS customers but that is swamped into oblivion by its 94.1 million wireless customers.
alian:
We actually aren’t talking about wireless vs wired, so if you want to start your tired argument about wireless vs wired, I’m surprised you’ve not brought out the ABS stats and distorted them again.
No, we’re actually talking about existing FIOS customers wanting faster and faster speeds on their FIOS (fibre) connections.
These are speeds they are demanding that will not be available on FTTN.
Which is what I said.
Nice try, but #fail.
I was just updating where Verizons customer base is relative to FiOS, I could also update you with USA figures of 26% and rising of wireless only residences, but naa that won’t happen here, only USA FTTH figures can be used here because you only want trends that fit your pro Labor NBN agenda.
#facepalm
You’re incorrigible…
Yes it’s interesting that the so called Verizon customer demand for 300Mbps FTTH translates directly into what will happen In Australia on the NBN but the increasing trend to wireless only residences in the USA does not.
*Facepalm* indeed.
Oh, FFS.
So we don’t need MT’s FTTN then!
Glad we got that sorted
Increased trend in wireless enabled devices, phones, ebooks, etc. Got tonnes myself. Total data usage fixed line increasing at a faster rate than mobile. I guess they don’t count the number of 3G devices that are used wirelessly on a home network.
26% wireless… ergo 74% fixed, even following the initial boom in tech gadgets.
Next.
26% wireess only means 74% HAVE a wired connection.
In my house there are 5 x 3G based wireless devices.
95% of the data to these deives would be over the WiFi link to the fixed broadband connection in the house.
Mobility is nice to have, but far too expensive and unreliable as the sole connection for the vast majority of users.
Logic failure confirmed.
Population > Premises.
300mbps down??? This is really weird. I was told that even 100mbps is too much and Verizon is launching a plan with 3 times this speed???
Well seems AU > USA once more anyway, 300mbps does sound great but personally I’d be happy to sacrifice some of that for more upload speed. NBNco’s 250/100mbps plan will be more balanced… Bring on the fibre!
<<<< Verizon currently charges its customers between US$74.99 (for its 24Mbps plan) and US$199.99 (for its 150Mbps plan) for its fibre to the home broadband services
Just think — the Verizon footprint is basically the US-equivalent of "Sydney, Melbourne, Brisbane, Adelaide & Perth", i.e. a carefully circumscribed roll-out to major US cities (where the cost per premise is lowest).
And they need to charge $200 for the ~100mbit tier for basic broadband access alone to make the numbers stack up.
Compare this to NBNco's 93% footprint where the more remote percentiles cost up to three times more to hook up than the capital cities.
If you think $200 is expensive, just imagine the amount that NBN ISPs will have to charge to allow NBNco to recoup their substantially higher cost base.
Tony Abbott is dead right about retail prices under a 93% FTTP NBN.
Curb Your Enthusiasm….Really?
Have you looked at any of the prices for the NBN? Our 100Mbps plans start at $79.95
Have you read any of the documents surrounding the NBN and the fact that it will be a WHOLESALE government owned network that only has to return 7% profit before ploughing money back in to raise service and lower prices? THIS is how it can subsidise prices to where it is more expensive. If you’re actually interested in seeing fact, have a read of this by Michael Myers, an IT expert and regular poster here:
http://www.itnews.com.au/News/302835,what-is-a-halted-nbn-worth.aspx?utm_source=feed&utm_medium=rss&utm_campaign=iTnews+All+Articles+feed
Have you ACTUALLY taken any effort in researching ANYTHING you just said? Or are you simply regurgitating Abbott FUD?
No, thought not.
Look, we’re pretty much look on people who spout this sort of stuff in the pro-NBN sphere as anathema, but seriously, if you actually want to talk pros and cons, rather than this political nonsense, please, let us know. We’re all happy to.
Michael Myers? He was in the Austin Powers movies, and not me.
:o)
LOL! Dammit! I MEANT Wyres….Stupid spelling check brain!
Sorry Michael!
This article?
http://www.itnews.com.au/News/302835,what-is-a-halted-nbn-worth.aspx?utm_source=feed&utm_medium=rss&utm_campaign=iTnews+All+Articles+feed
In fact, the perfect textbook example of this cross-subsidy is currently under construction in Australia, and you may have heard of it. It’s called the National Broadband Network.
Any student of economic policy will tell you cross-subsidies are detrimental to economic efficiency.
1/ Telstra once proposed to implement uniform wholesale pricing for the CAN to the ACCC — it was rejected outright on the grounds that cross-subsidies are economically inefficient.
2/ Productivity Commission report on greenfields issue recommended the Fed Government use direct budget subsidies to deliver infrastructure policy in regional areas.
Cross-subsidies are bad economic policy — end of story.
Just like the retail network I helped build six or seven years ago, the fibre connections that make up the vast majority of the NBN will actually cost NBN Co a lot less than $24.00 a month each customer to supply. It would not surprise me if the actual cost per connection is less than half of that amount.
Michael claims the cost of fibre connections is “less than half of that amount ($24)”:
1/ Average wholesale revenue on the CAN is $33-35 — producing an asset valuation (or capital base) of ~$10bn. NBNco’s fibre network alone will cost well over $20bn. How can you service a capital base which is at least twice as large as the CAN at wholesale rates of less than half those of the CAN? You cannot suspend the laws of simple arithmetic.
2/ Assuming zero principal repayments, $12/mth annualised ($144) at 7% cost of funding will service a loan principal (or capital base) of approx. $2,057. (Factoring in asset depreciation and OPEX would make the realistic figure much lower.) Seriously? The average capital cost of laying fibre to 93% of premises in Australia is a measly $2,000? That’s funny — according to the McKinsey Report, only the first 10 percentiles would fall anywhere near the sub-$2000 mark.
Absolute rubbish.
Mike Quigley said at Senate Estimates last week that not completing the network would leave the company in situation without a purpose, and without hope of privatisation. Nobody would likely come forward to buy the satellite and wireless networks.
Bullshit. Every asset has a price — offering it at fair market value will elicit buyers. What he really means to say is that no one will buy the satellite and wireless networks at NBNco’s build cost.The second inference is that the negative discrepancy in book value and fair market value of these assets will be offset by a positive discrepancy for the fibre network. Hence:
. . .they are just not viable on their own without the subsidy provided by the fibre portion of the network.
So, the logic here is that the 93% FTTP network will cross-subsidise the 7% wireless/satellite networks. However, we also know the cost of pushing fibre to the regional extremities of the 93% fibre footprint is up to three times more expensive than the metro portions. So, you guessed it — not only are fibre subscribers cross-subsidising wireless/satellite users, metro fibre subscribers are also cross-subsidising regional fibre users.
The logical question that follows is — if metro fibre subscribers are subsidising everyone else, who is subsiding them (as well as giving the Government an overall 7% ROI on its equity investment)?
Answer: no-one — metro broadband prices HAVE TO RISE (substantially).
Labor is trying to sell us a free lunch — there’s no such thing as a free lunch.
Communications minister Stephen Conroy added, “essentially it would transfer back onto the budget because by definition it is no longer an investment. So the entire cost would transfer back onto the budget.”
Bullshit. The budgetary impact would be restricted to the writedown of asset values to fair market value.
Further, it was revealed at Estimates that take-up of the higher speed tiers – and therefore higher average revenues per user on the NBN – is so far well ahead of initial expectations that the fibre network may well become even more viable than first envisaged.
NBNco could give everyone 1Gbit tomorrow at 13:1 contention ratio, and it wouldn’t improve the viability of the NBN by one iota unless there is a corresponding improvement in ARPU ahead of budget expectations.
So, what did Quigley reveal at Senate Estimates?: “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.”
“$29.55” — that’s less than copper wholesale ARPU. In short, there is absolutely no evidence that the NBN will bring in more revenue than originally envisaged in the Corporate Plan. Faster take-up of higher speed tiers, by itself, has no impact on project viability unless there is a corresponding acceleration in network revenue.
Given that it won’t be viable to sell the satellite and wireless networks, will Turnbull’s proposed solution – use of fibre-to-the-node technology – generate enough revenue to support them? It won’t cost as much to build but it won’t return the same revenues of the fibre network either.
The capital cost of FTTP is at least three times that of FTTN — does anyone seriously suggest that the average household is prepared to fork out three times greater in wholesale charges for FTTP services (relative to FTTN) when there are no generalized residential applications for 100mbit in existence?
They just may find themselves in a situation where they can’t afford to…
blah, blah, blah… the whole article is complete, unmitigated nonsense from start to finish.
“2/ Assuming zero principal repayments, $12/mth annualised ($144) at 7% cost of funding will service a loan principal (or capital base) of approx. $2,057”
That would be all valid if they were servicing a debt with 7% cost of funding. Since the Australian bond rate is 2.88% your argument is garbage.
In the original Corporate Plan, the project is described as having an internal rate of return (lRR) of 7%.
Subsequent to the SAU agreement, the new Corporate Plan will be based on the revised and refined “cost of funding” measure which is the “plain vanilla WACC”. In an ACCC submission, NBNco’s proposed WACC is 9.1%.
So, “7%” is very generous — you’re wrong.
(You can’t just look at the government bond rate, there are risk premiums involved.)
I’m sorry Curb, but YOU are wrong.
WACC is risk, as you have said. That is NOT taken into account for funding FROM THE GOVERNMENT. The funding from the private sector involves the WACC.
So, in fact, the total “funding rate” if you like, would be a weighted average of $27B @ 2.88% and $13B @ 9.1%….which equals 4.9%….
Try reading ACCC documents instead of making stuff up.
WACCt = rft + 350 basis points
Where rft is the risk free rate of interest calculated as the average yield on 10 year
Commonwealth Government Securities averaged over the final 20 days of
the preceding financial year; and
we refer to the 350 basis points as the „set WACC risk premium‟.
http://www.nbnco.com.au/assets/documents/report-on-wacc-component-of-nbn-co-sau.pdf
So….that’d be 2.88% + 3.5%….or 6.38%. Higher than mine, but lower than your “generous” 7%
pg 14
I was going to keep going, noting the clear difference in there to simply using the WACC as the be-all and end-all for calculating debt risk and the ACTUAL way it is calculated.
But I just can’t be bothered. I’ve been up since 4am.
Curb, you don’t ACTUALLY care about any real world objectives. That’s quite obvious- the statistics and economics are all that matter to you.
Fantastic. Go be a banker, or an investment analyst. You can cause our next GFC.
Meanwhile, I’ll trust the Telco industry, some of the best Telco experts in the world (including Quigley who is so excited about the chance to build such a brilliant engineering network project as the NBN he gave his first YEAR’S salary to charity) and the business arena at large who all clearly want the NBN and believe it is viable.
No doubt you’ll take this as a win of your argument. Feel free.
Of course Verizon doesn’t need to raise prices because its infrastructure costs are too high.
‘Verizon customers should expect to pay more for Fios and their wireless service, as the company looks for ways to increase revenue to justify its spending on its infrastructure.’
http://news.cnet.com/8301-1035_3-57435906-94/verizon-plans-price-hikes-for-fios-wireless-users/
oh dear, yes they do, lucky the NBN is being paid for by the sucker taxpayer funded sinkhole eh?
7% return and 70& uptake? – tell them they are dreaming.
They shouldn’t need to raise them at all, they are already sky high.
<<<<Shammo said the company currently has no plans to build out the Fios service to new areas, but he said that if the service becomes profitable, the company may re-examine its options.
Just as I thought, they are losing money on their FiOS roll-out.
Well this is what they charge for their current highest FiOS speed 150/35 Mbps.
http://www22.verizon.com/home/fiosinternet/ultimate
The 300Mbps will be higher charge than that, so in reality it’s a business plan because they will be the only ones that can afford it, and I bet it’s only select lucrative CBD areas where they are making it available.
Yes it’s such a shame they have to resort to such high prices. When the US catch on to having one wholesale infrastructure to make their BB viable. Their market driven, infrastructure level competition isn’t working for them. We should learn from that.
Perhaps we could also learn from the USA where the Obama administration has announced their version of a Government supported NBN – it’s 4G wireless.
Or you could of course take the NBN critics advice and “move there” ;-)
Stop trying to make a case that the NBN has to pay a theoretical interest rate used for risk management calculation. Fine if it was private investors, they want to see a return on income that is appropriate to the risk. The government however isn’t, and has stated on numerous occasions, expecting a ROI for many years to come. And the actual payments to be made for the capital are the interest rates.
So, you’re saying NBNco’s submission to the ACCC is a fake submission?
LOL
NBN cheerleaders have an “entrenched monopoly” on self-delusion.
I did say it was fake at all. It includes WACC to show risk profile. The government isn’t expecting them to pay 7% pr so on the loan like a private company would want as a return for invested capital. They aren’t expecting a return for many years.
I am saying your use of the WACC as a COST to the NBN is bogus.
Curb You Enthusiasm
Firstly, hi Reality Check *waves*- Yes, the Bold and Italics gave it away….
“Any student of economic policy will tell you cross-subsidies are detrimental to economic efficiency.”
That’s the economic efficiency of the market I’m assuming you mean, because I can’t possibly see how it is econo…..oh wait, you mean because it doesn’t make the Telco’s so much MONEY? Yes, because that’s ultimately what Australian consumers want- not better broadband, they want their industry to make higher profit margins. In that case, yes, yes it is inefficient….but it’s very efficient for consumers, cause no matter where you live, you get the same price. Fair? Depends on your upbringing I suppose. Those of us who were taught to respect their fellow man realise that city folk paying a few dollars more a month so the rest of the folk outside the city don’t have to pay HUNDREDS of dollars a month is a pretty fair exchange. And apparently the Australian Government believes this too. It has been there mandate, no matter which side of politics, to ensure social equity in a widely dispersed population.
Oh, and by the way, this is the “economically efficient” market which currently has Telstra charging by access, regardless of speed, for broadband EVERYWHERE, meaning it is essentially cross-subsidising the entire country for RSP’s. The only difference it has for pricing is Zone 1, and Zone 2/3 on exchanges. And guess how these zones differ? By how much competitive DSLAM infrastructure is at the exchange. So essentially, if there is lots, Telstra dials down the wholesale charges, so it can squeeze competitors, all the while knowing that the VAST majority of its’ ESA’s (over 1500) have little to no competition and so it can charge, essentially, what it likes for wholesale access. In this way, Telsra is SUBSIDISING its’ own network BACKWARDS- ie the competitive areas that produce least ARPU are subsidised by the non-competitive areas which do…..yes, yes,Curb Your Enthusiasm, this is a MCUH more efficient market than one in which ALL areas have EQUAL competition and therefore consumers win out and the market doesn’t. Thanks for your utterly selfish point of view there pertaining to increased profits.
Also: http://www.businessspectator.com.au/bs.nsf/Article/NBN-Telstra-broadband-fibre-Conroy-Optus-competiti-pd20110622-J2SXK?opendocument
Side not to anyone who reads that- I don’t know where they get their info but “about 10 to 15 per cent of Australians live outside urban areas” is untrue. According to the governments own figures, almost 30% of people live in regional or rural areas….
“1/ Telstra once proposed to implement uniform wholesale pricing for the CAN to the ACCC — it was rejected outright on the grounds that cross-subsidies are economically inefficient.”
– Firstly, reference or GTFO. Secondly, I would hazard a guess the reason the ACCC rejected it was that Telstra had a very good profit projection if this was to be done, enabling them to cherry pick areas for HFC/Fibre upgrade and remove competition as the CAN can’t compete with those technologies. But again, until I have a reference, no dice.
“2/ Productivity Commission report on greenfields issue recommended the Fed Government use direct budget subsidies to deliver infrastructure policy in regional areas.”
Ummmmm…
“Recommendation:
Investments in items of social or economic infrastructure that provide benefits in
common across the wider community should desirably be funded out of
borrowings and serviced through rates, taxes or usage charges.”
http://www.pc.gov.au/__data/assets/pdf_file/0016/56302/housing.pdf
ie. exactly what NBN are doing….
What were you saying?…. “Cross-subsidies are bad economic policy — end of story.”
Quite obviously not….
“1/ Average wholesale revenue on the CAN is $33-35 — producing an asset valuation (or capital base) of ~$10bn. NBNco’s fibre network alone will cost well over $20bn. How can you service a capital base which is at least twice as large as the CAN at wholesale rates of less than half those of the CAN? You cannot suspend the laws of simple arithmetic.”
The CAN is run on old technology (both figuratively and literally), it is subsequently more expensive to maintain. Many articles have indicated it costs Telstra almost $1 Billion just to maintain it, let alone servicing fees. The fibre will cost significantly LESS than that to provide the SAME SERVICE ie. the 12Mbps service, which will service all those people who only want phone and basic internet; quite a few of which have no choice of anything else on the CAN. What is amazing is that, with all your economic prowess, you seem to have forgotten a rule in economics: Significant capital outlay can be offset by lower ongoing costs…..
If people want MORE service, they buy higher tiers which have higher wholesale costs, which INCREASES ARPU above that of the CAN!! This is the ENTIRE POINT of the Corporate Plan!! There’s no suspension of arithmetic. You’re trying to equate 2 formulae that don’t equal one another, because the CAN CAN’T increase its’ ARPU, due to physics.
“2/ Assuming zero principal repayments, $12/mth annualised ($144) at 7% cost of funding will service a loan principal (or capital base) of approx. $2,057. (Factoring in asset depreciation and OPEX would make the realistic figure much lower.) Seriously? The average capital cost of laying fibre to 93% of premises in Australia is a measly $2,000? That’s funny — according to the McKinsey Report, only the first 10 percentiles would fall anywhere near the sub-$2000 mark.”
So, as Noddy has already pointed out, at 2.88% cost of funding….I’m not gonna bother working it out. The point is moot.
“Bullshit. Every asset has a price — offering it at fair market value will elicit buyers. What he really means to say is that no one will buy the satellite and wireless networks at NBNco’s build cost. The second inference is that the negative discrepancy in book value and fair market value of these assets will be offset by a positive discrepancy for the fibre network. Hence:
. . .they are just not viable on their own without the subsidy provided by the fibre portion of the network”
Exactly the point….they’re not viable in operation and therefore no one will buy them because they can’t produce a decent return without the rest of the NBN subsidising them, regardless of “fair market value”, hence loss of capital if the NBN is cancelled…..I don’t see your point? You just went round in a big circle….
“So, the logic here is that the 93% FTTP network will cross-subsidise the 7% wireless/satellite networks. However, we also know the cost of pushing fibre to the regional extremities of the 93% fibre footprint is up to three times more expensive than the metro portions. So, you guessed it — not only are fibre subscribers cross-subsidising wireless/satellite users, metro fibre subscribers are also cross-subsidising regional fibre users.
The logical question that follows is — if metro fibre subscribers are subsidising everyone else, who is subsiding them (as well as giving the Government an overall 7% ROI on its equity investment)?
Answer: no-one — metro broadband prices HAVE TO RISE (substantially).
Labor is trying to sell us a free lunch — there’s no such thing as a free lunch.”
Curb, your constant knocking of the Corporate Plan, based around increased HIGHER service uptake, rather than dead level playing field with the current CAN, is baffling. Business at large has accepted it as conservative, at its’ ROI of 7%. If you disagree, that’s fine. You’re against the flow, but there are always people that can’t see things till they fall on their heads. You’re repeating all this so people will think you’ve “done your research”….all this “research” has been done by NBNCo. and they have found that the ROI is not only viable but likely to be higher, therefore they will be able to plough the extra return BACK INTO the NBN to DECREASE costs as their mandate is public provision of service NOT commercial return- shown by the recent numbers coming out that HIGHER tier plans are MORE popular than NBNCo. thought = better ROI.
This idea you have that metro broadband prices have to rise is ridiculous; NBN prices have been set already and are cheaper or the same cost as current plans that have the SAME SERVICE and your economic rubbish is just a way to hide it because, commercially (ie. profit above 15%), the NBN isn’t at ALL well planned to return profits- BUT IT ISN’T COMMERCIAL!!
There IS no such thing as a free lunch- but when the lunch is provided to you at cost plus a modest 7% profit, it is considerably cheaper than McDonalds who make ~ 20% profits.
“Bullshit. The budgetary impact would be restricted to the writedown of asset values to fair market value.”
Language….No, the total cost would depend entirely on how much of the current infrastructure was able to produce an ROI….ie. if the NBN no longer existed as an entity, as the Coalition have indicated will happen, the ROI is non-existant and therefore the ENTIRE capital MUST be put on budget, because it is no longer giving a return.
Again with your commercial market- this isn’t commercial market, it’s government. Would the asset value be different than capital spent?Yes, as you say, it would be written down to fair market value- that DOESN’T change the fact that the capital was ACTUALLY outlayed and MUST appear on budget if the ROI is non-existant; ie. it is now no longer CAPEX for a company owned by government, it is taxpayer funded subsidy. Money is money- you can try and hide it all you want, but the money was ACTUALLY spent and because the ROI isn’t produced, you can’t make the money disappear with accounting tricks that apply to a company, not a government.
“So, what did Quigley reveal at Senate Estimates?: “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.”
“$29.55″ — that’s less than copper wholesale ARPU. In short, there is absolutely no evidence that the NBN will bring in more revenue than originally envisaged in the Corporate Plan.”
Of COURSE it’s less than the CAN- they’ve only got, what, 8000 people on it!! And many of them are on Satellite which has a very low ARPU! It’s a build in progress. To say it will receive the same ARPU now as when the VAST majority are connected is ridiculous.
“Faster take-up of higher speed tiers, by itself, has no impact on project viability unless there is a corresponding acceleration in network revenue.”
THIS IS WHAT THE CORPORATE PLAN WORKS ON. Higher ARPU from higher tier uptake. You’re spouting dribble now.
“The capital cost of FTTP is at least three times that of FTTN — does anyone seriously suggest that the average household is prepared to fork out three times greater in wholesale charges for FTTP services (relative to FTTN) when there are no generalized residential applications for 100mbit in existence?”
Where is your data that says FTTN will be 3 times cheaper in wholesale costs than FTTP? Oh, that’s right, you don’t have any, because you are simply basing it on capital outlay only. THIS. IS. NOT. COMMERCIAL. MARKET. I don’t know how many times I’ve said this and it doesn’t seem to penetrate.
The Coalition are so tied up in the business case, which is still solid, if underwhelming, and they have utter contempt for the actual SERVICE NBN will provide. “no generalised applications for 100Mbps”….and yet 34% of current fibre connections are 100Mbps…..You REALLY don’t want to get it do you? Australians have disposable income. Australians LOVE the internet; look at any growth forecasts and Australia is WAY up in the higher growth figures of the world for internet use. THEY WANT FASTER INTERNET!!
The fact that the market cannot provide evidence of applications for 100Mbps is as much a consequence of the market itself not PROVIDING the applications, because the current CAN is unable ANYWHERE to give that speed to the vast majority of Australians and only 35% of Australians are able to POSSIBLY receive it from HFC (when it isn’t too congested to get above 50). The applications don’t exist because the INFRASTRUCTURE isn’t good enough for enough people to make those applications viable!!
All you “economists” look at is ROI, ROI, ROI. You can’t see your NOSE for the $$$ in front of your eyes. Australia NEEDS better telecommunications infrastructure and the market be BLOODY damned if they don’t like it. The market only cares about profits, the Australian people want better service the market won’t provide cause it doesn’t make profit, because of the sorry state of the infrastructure!
Stop with the “market economics” rubbish and actually be a consumer for once. If the supply is given, the demand will suck it up. You’re just so used to trickling supply out to make HUGE profits off the demand, government intervention for the sake of fair charging of the consumer gives you hives! The business plan works on a BACKWARDS timetable to normal commercial investment, but that’s not a problem because it has the largest, most risk free backer in the country- THE GOVERNMENT!
P.S 1) Sorry for the novel people, but most of that was so much rubbish, I just couldn’t leave it alone.
2) Curb/Reality Check whoever you are- please stop with the bolding- I have to remove the every time I quote you. It doesn’t accentuate your point better than just using capitals like the rest of us.
“THIS IS WHAT THE CORPORATE PLAN WORKS ON. Higher ARPU from higher tier uptake. You’re spouting dribble now.”
If you were paying attention, the first movers tended to be the ones opting for the high tiers (which presumably is why they were first movers at all, because they wanted a faster link). The real reason the APRU is low is because the NBN is currently offering special deals on the CVC usage charges, and at some future stage they will have to stop the special deals and start pushing up the prices.
“If you were paying attention, the first movers tended to be the ones opting for the high tiers (which presumably is why they were first movers at all, because they wanted a faster link). The real reason the APRU is low is because the NBN is currently offering special deals on the CVC usage charges, and at some future stage they will have to stop the special deals and start pushing up the prices.”
Tel, where is your evidence all the people who’ve chosen high tiers are “first movers”?
That is indeed one reason the ARPU is lower right now, because of the CVC subsidy which allows better competition for smaller players while the market is young. It will disappear, but it is only for the first 150Mbps. Even with 121 POI’s, that will be a small amount of the required throughput of most POI’s, so it will make little to no difference to prices once it’s gone in the later stages of the NBN build.
Firstly CUE I find it uncanny how similar you, 1% poster and ToshP300 are. Are you triplets?
Secondly, all your stupid, hand-picked number crunching has all been answered before and until you realise the NBN ISN’T just about numbers (no matter how you want those to add up – and we know your approach) well you miss the point entirely, either accidentally or intentionally. Particularly if you actually believe NBNCo’s approach is wasteful and the Oppositions, subsidies isn’t?
And in relation to cross subsidies –
“To ensure prices to end users in rural and regional Australia are comparable to those for similar services in metropolitan areas, the operator(s) of these wireless broadband networks will be required to provide a service over the network at a price comparable to similar DSL services in metropolitan areas.11 The requirement will apply for the life of the contract (expected to be fifteen years).”
This was part of the Coalition’s Broadband and Telecommunications policy gong into the 2010 election.
The Lib/Nat coalition have to support some pork for the rural areas because they are a coalition and the National Party insist on it. Exactly the same as the Winsor/Oakshot/Green/ALP coalition must do.
Err, but your mate told us (above) and I quote. “cross-subsidies are bad economic policy — end of story.”
Apparently they are only so when Labor says and pure as driven snow when the Libs say…
Curious but typical logic from you few.
So to remind you, we are here to discuss, tech and the NBN.
“Any student of economic policy will tell you cross-subsidies are detrimental to economic efficiency.”
They will also tell you that the market is “self correcting” and any boom/busts/bubbles you may see are figments of your imagination.
They will also tell you that supply and demand are completely unrelated. The best way to increase sales is to reduce wages across the board, ipso facto, if you reduced everyone in Australia’s wage to zero, they would purchase an infinite amount of goods with their zero income.
In the real world, cross-subsidies are essential. How many highways, railways etc would get built if governments did not finance them via tax revenue.
How “efficient” would our economy be if highways and railways were completely absent.
“And they need to charge $200 for the ~100mbit tier for basic broadband access alone to make the numbers stack up.”
NBNco > Verizon. AU > USA. Thanks for confirming that.
“Tony Abbott is dead right about retail prices under a 93% FTTP NBN.”
Except he’s dead wrong.
Who’s offering unlimited data at 100mbps in Australia?
No one Nich. It won’t happen. Our Telco industry doesn’t, rightly, believe in that.
Look what it’s done to the US industry.
It’s available right now in Australia, you just don’t want to pay for it.
Incorrect Tel. The only major ISP to offer Unlimited downloads (and if you read their T’s&C’s I’ve no doubt there will be a fair use charge) in Australia is TPG.
And their network covers only some parts of the cities. I do not live in a city.
Also, you’re right, I wouldn’t pay for unlimited. Why? Not because I don’t think you could ever go above quotas ever, you could, but because on ADSL2+ speeds, unlimited data makes little sense. Unless you were torrenting 24/7 at FULL ADSL2+ speeds, it is ALREADY difficult to go over the 1TB caps we’re seeing on the higher plans.
At 100Mbps speeds, it will take considerably less with applications such as HD movie streaming and full cloud storage solutions LIKE THEY HAVE IN THE US.
Australians don’t take unlimited not because they don’t want to pay, but because most wouldn’t USE more than 1TB at the speeds they have.
‘Incorrect Tel. The only major ISP to offer Unlimited downloads (and if you read their T’s&C’s I’ve no doubt there will be a fair use charge) in Australia is TPG.’
Incorrect seven_tech, Dodo, Exetel, Primus and Club Telco all offer unlimited plans.
And each will cancel your account if you start using it as “unlimited”. In reality use more than a couple of hundred gig and they send you a warning.
http://thebernoullitrial.wordpress.com/2010/08/07/australian-isp-market-share-2009-2010/
Really?
Seems to me the largest 4 ISP’s are, in order:
Telstra, Optus, Iinet, TPG
All others have 2.5% or less of market share. Not what I would call MAJOR ISP’s. And that was the point I was making. Sure other ISP’s offer it, but they do so to try and gain market share. These 4 above make up more than 75% of the market….I think I’ll stick with them as the major ISP’s.
Err and how much will we (well 40% of us) be paying for Tony’s greatly inferior FTTN.
Perhaps we should all move to a Verizon area in the US?
You anti-NBN circus performers are precious.
Maybe the fact that it is unlimited has something to do with their pricing ?, plus they are capitalising on the demand and are charging a premium price. it is called the market rules
I ain’t saying the NBN is nirvana but I am sick of “my country the quarry”. There has to be more.
Not to a Liberal unfortunately
“Verizon said the higher speeds would provide customers with “sustained speed and reliability of service”. In contrast, the company said, rival companies operating HFC cable networks only offered “intermittent speed boosts” as their networks were not completely fibre-optic.
“Our top FiOS speed will be twice as fast as anything America has ever seen,” said Mike Ritter, chief marketing officer for Verizon’s consumer and mass market business unit. “High-speed Internet no longer is just for techies, as more than half of our residential consumers already use at least a 20Mbps Internet connection. Streaming online video on an all-fiber-optic connection providing faster speeds is better and more reliable during peak Internet usage hours.”
Malcolm, take note
Problem with Verizon is they roll out to areas that will maximise there profits, which is what you’d expect a private company to do. Usually high-density middle income suburbs etc. This leaves a lot of Americans in a worse condition then some Australian’s, Think 1.5mbps ADSL or less, bad 3g coverage or nothing at all.
This is why I’m all for the 93% FTTP NBN, it leaves no man behind. Once it’s built, companies can innovate and rollout cloud services, video streaming services and other benefits yet to be seen. Knowing that the worst connection available to Australian’s in the city will be 12mbp/s fibre.
Wake up Malcolm Turnbull and the Liberal Party!
Unfortunately I think whatever the coalition plan to do if they win the election, the Verizon model could still come to Australia, but exactly as it has done in the USA….. across high value, high income CBD’s and inner city suburbs.
One of the key facts about the NBN is that it wouldn’t discriminate between geographical locations.
< < < <the Verizon model could still come to Australia
Here's the rub:
The US telco market couldn't be more different than Australia. The major telcos like Verizon and AT&T exhibit extensive horizontal and vertical integration. Also, importantly, there is negligible "line sharing" or third-party access to their networks.
When a telco such as Verizon builds or upgrades its network, they are able to reach directly into the retail value chain experimenting with various retail product and marketing strategies to recover capital invested. Also, because they don't have to "share" their networks like Telstra does, they are assured of capturing most of the retail value that's generated from the new infrastructure built with their own capital.
These characteristics of the US market incentivise telcos such as Verizon to take risks and build new infrastructure even when demand isn't there at the moment. If they were instead forced to share whatever new retail value is generated from these risky investments with other retail players that don't have any skin in the game, they wouldn't bother because having to hand over retail margin to other non-contributing third-parties reduces the scope and likelihood of capital recovery.
Under an alternative open access regime such as we have here in Australia, Comcast would simply wait for Verizon to upgrade its network and then seek third-party access to experiment building new retail value chains off Verizon's new network instead of taking the massive capital risk of upgrading its own network. Similarly, Verizon would be faced with the same incentives to hold off upgrading its own network and instead seek access to any new Comcast infrastructure.
The end result would be what we have here — nothing gets built because "open access" and regulatory gaming ensures that a huge chunk of the potential benefits from risky infrastructure investing are dissipated and are not available to maximise the chances of capital recovery for the risk-taker.
It's precisely because there's limited scope for third-party access that US telcos are engaged in a competitive "arms race" to upgrade their infrastructure to offer consumers better products than what they currently require to protect their retail market share.
Actual take-up of Verizon FiOS is not that crash-hot. Verizon is raising speed tiers across the various price points probably in competitive response to cable competitors to promote greater retail uptake. You guys are making a mountain out of a molehill of "marketing spiel" to promote their newly-enhanced speed tiers. To argue that demand is strong, you would need to show evidence either of rising ARPU or expansion of FiOS footprint.
In fact, it wouldn't surprise me if Verizon is incurring a capital loss on its FiOS roll-out to date and is cross-subsiding its fixed-line investments with profits from mobile and other divisions.
There's a reason why major telcos around the world all exhibit extensive horizontal and vertical integration. It's an efficient form of risk diversification to hedge against rapid technological and consumer behaviour changes; and it's an organisational structure that best facilitates risky and expensive capital investment. Instead, here in Australia, we're busy demonising big Telstra and calling for it to be hung, drawn and quartered.
Curb, you’re comparison between the US and Australia fails to take into account one hugely significant thing: numbers. Which I’m surprised at, because that’s what you seem to enjoy…
Let’s take a look at Verizon’s FiOS should we?
So, under current numbers we have FiOs serves 3.7 Million customers, out of a total base of up to 13.7 Million. The FiOs network, then, for a country of 280 Million people is very modest, as you say.
But let’s translate those numbers down to Australian size- Australia has a pop of 23 Million, less than 1/10th of the US. So, if Verizon were in Aust. they’d have a possible customer base of….about 1.2 Million people, and an actual connection base of….300 000 people….less than the connections on the Optus HFC network.
And who hasn’t invested ANY significant money in their HFC cable since early 2001?….Optus. Why? IT’S NOT PROFITABLE. You’re analysis works excellently for the US, China, Europe and Latin America. They have VASTLY larger populations, but country’s around the same area. Australia DOESN’T. And THAT is why Telstra is so big and competition of infrastructure WILL NOT WORK in Australia, because the risk of so few people means ANY major risk, such as building larger sections of FTTP, like FiOs, has almost NO chance of significantly increasing revenue. Why? Sheer numbers. Verizon can take the seemingly large risk of an expensive upgrade to FiOS to its’ relatively small base of 13.7 Million people, because it has a total customer base of 107.7 MILLION people!! That’s 4 TIMES the population of Australia!!!!
http://www.nytimes.com/2011/10/22/technology/verizon-profit-jumps.html
Your analysis makes NO sense in Australia. Who has produced the most amount of innovative (that’s being generous to call them innovative) infrastructure applications in Australia? Telstra. BigPond movies, Foxtel HD (PayTV is ANOTHER story as well), T-box. All these, because the customer base on its’ fixed line is in the vicinity of 9 Million and its’ mobile base is closer to 13 Million. These are TOTAL customer bases LESS than that of FiOs’s TOTAL reach! Telstra has introduced these because it has the customer base that supports them.
Companies like iinet and Internode, can only introduce innovation-over-existing-infrastructure products (Voip, Fetch-Tv), because there is NO money in building their own infrastructure (other than DSLAM’s over Telstra cables). Otherwise, why would we have not seen iinet and Internode laying their own HFC or even fibre? Same reason only Optus has laid theirs against Telstra- there are not the sheer NUMBERS to support high risk ventures like that in Australia. It has nothing to do with regulation of the infrastructure. You could deregulate the infrastructure as much as you want, as we have tried, and their STILL wouldn’t be enough profit incentive for companies to rollout their own infrastructure, because Telstra holds 70% of the market overall and the customer base they could gain for the MASSIVE CAPEX required to rollout competing infrastructure would be too small to mitigate the risk.
THIS is why the government had to step in with the NBN. It could see there was going to be no competition in infrastructure because Australia’s density IS TOO SMALL. So they said “Alright then, WE’LL put in the infrastructure and ANYONE can use it equally”. That way, if the infrastructure is good enough (ie FTTP) then ALL ISP’s can compete on innovative-over-existing-infrastructure products, removing the infrastructure providers advantage to owning it all.
Your analysis of US vs Aus makes no sense. And it’s already why providers in Australia STARTED with data caps, rather than rolling them in now, much to the disgust of their customers, as is happening in the US; their networks here in Australia CAN’T handle that data, because the CAPEX for the hardware to handle it is too much to see profit on the too small existing customer base. We are too small a population in too large an area to have competing telecommunications infrastructure . If you can’t see that, maybe you need to go live in the US where you can make money off your “ideas”
What you fail to understand is under copper, voice is the anchor product and ADSL is sold as a supplementary source of revenue. So, while Telstra may have 50% of the national broadband market, their total fixed-line revenue share is much higher due to their dominating presence in voice (and the fact that voice penetration is much higher than broadband).
All this changes under the bandwidth abundance of Next Generation Networks, where broadband becomes the anchor product and voice is a low-value retail add-on. So, under any future NBN regime, Telstra’s share of total fixed-line revenues will collapse down to its market share in broadband (50%), which becomes the new revenue anchor.
Also, bear in mind, Telstra’s broadband market share in the lucrative metro areas is only 30%. In the new era of superfast networks, almost 70% of total fixed-line revenues in the metro markets are up for grabs by companies other than Telstra.
This idea that Telstra has cornered too large a share of the market for infrastructure competition to take place is complete nonsense. (Also, the cost calculations and issues of financial viability associated with infrastructure building revolve around “unit costs” and not total costs.)
I don’t disagree with your assertions around Telstra’s voice dominance Curb. It will certainly fallback under the NBN…that’s half the point. But they aren’t doing anything about it. ALL other competitors INCLUDING Optus, offer naked plans….but not Telstra. Why? Because Telstra KNOWS the “Mum and Dad” and “Grandma and Grandpa” customers don’t understand this VOIPy thingy and so they can gain $30 extra out of them a month….for doing nothing.
“Also, bear in mind, Telstra’s broadband market share in the lucrative metro areas is only 30%.”
Yes, it may be, but the other 70%, if not on Optus (and let’s fact it, with Optus’ TOTAL customer base on HFC being 400 000, it’s NOT a big market share of the 13 odd Million in the cities) ALL have to “hire” Telstra’s copper. Which means, even when Telstra ISN’T gaining customers direct it STILL makes money off the copper, hence THE MONOPOLY.
“This idea that Telstra has cornered too large a share of the market for infrastructure competition to take place is complete nonsense.”
Really. Pray tell, where is the competing infrastructure then? And don’t give me Optus, or your greenfields or your TransACT. Their TOTAL market share is less than 10%. THIS statement is rubbish. If it were true, we would have infrastructure competitors with dozens of % market share between them. But we don’t.
“(Also, the cost calculations and issues of financial viability associated with infrastructure building revolve around “unit costs” and not total costs.)”
Yes and the unit cost to provide fibre in Australia is at about $2000/premises averaged. This is nearly twice as high as the US (at between $1100 and 1300) and nearly 3 times higher than countries like Hong Kong and Japan (at between $600 and $800). This includes all premises, not just those slated for fibre. Those just slated for fibre brings it back to $1500/premises, STILL higher than most of the world. The financial viability IS NOT THERE. Please, SHOW me the companies lining up to rollout HFC, FTTN or even FTTH?? There aren’t any, because Telstra has too much of the market right now AND because it is too expensive “per unit”.
??????
Sorry, I’m not going to waste my time responding to someone who continually embellishes his posts with made-up fictitious numbers and is clearly disinterested in discussing issues with an honest mind.
LOL, now I’ve heard it all.
ROFL Do you believe you own BS?
Noddy,
On behalf of the nation, my deepest apologies to you and your family that our education system has failed you.
God bless you.
It doesn’t take much to see through your fudged up arguments.
“Lets assume this, and if we pull this figure out of thin air and apply a theoretical figure and ignore the actual one….”
That’s what I love about the anti-NBN crusaders. They all have their own little pet theories that they’ve put so much work into about how and why the NBN will fail then the real facts come in smack them in the face, it puts them in a spin so then they have to revise everything (no wonder they are so bitter and angry) it just gets even more convoluted when they have to rely on even more “ifs” “buts” and “maybes”. And just wait for the next corporate plan lol.
@ Hubert
Which real facts? The 18% overall take-up rate (as diligently calculated by Mathew), or the measly $29 ARPU on brand new NBN fibre?
Can’t wait for the new Corporate Plan to be released — Malcolm will have a field day… LOL
Wonder how long it will take Australia’s worst Communications Minister ever to release it…. last time it only took a veto threat on NBN legislation by Xenophon. . . . LOL
Labor clearly has nothing to hide… oh, no. . . . LMAO
Please curb your idiocy for one second, you realise are now relying on the interpretations from someone who is notorious for getting it wrong every single time. With the release of a new corporate plan it doesn’t change anything at all, we already know what Turnbull is going to say (he is pre-programmed) we already know what MM will say (he is pre-programmed and is no too bright) and we know what you are going to say (your comments in this article are not getting any better).
Newsflash: It makes no difference what so ever, if the last two years is anything to go by I’m sure you and the rest of the luddites will just spout some more ill-informed nonsense and have an other hissy fit when you realise you are wrong yet again. The cycle continues… want a cookie?
@HC
‘you realise are now relying on the interpretations from someone who is notorious for getting it wrong every single time’
Not that you or anyone else for that matter has proved them wrong, but apparently just merely saying it over and over is all that is required.
“Not that you or anyone else for that matter has proved them wrong”
You obviously haven’t been paying attention but I don’t expect you to. Perhaps you missed the fact that the most popular plan on the NBN is the 100/40mbps just as I predicted. The anti-NBN zealots were wrong, I was right. Get over it.
And yes we know your boring worn out argument about “NBN Co is subsidising the true costs blah blah blah” so it’s now time for you to answer the question about when the prices will rise and how much they will rise by, and you will also have to prove if this has any effect on the take up numbers for the higher speed plans. Go.
“On behalf of the nation, my deepest apologies to you and your family that our education system has failed you.”
What a condescending statement to make, especially coming from someone who obviously fails to recognise the limitations of Economics as a discipline.
l agree — we should shut down or stop funding all our business schools and stop them teaching commercial case studies of how things actually work in the real world.
Instead, how about a new Conroy Quigley New School of Public Enterprise?. . . . extolling the virtues of “Free Costless Infrastructure Theory”.. . .
You spectacularly missed the point and then you could help yourself.
You had to throw in a little political cheap shot and in doing so exhibited what you are obviously very talented at doing: cherry picking whatever suit your argument.
I believe that was a clear *yes* Noddy…
Please, enlighten me Curb, what numbers am I making up?
Correction also, my first sentence of the last paragraph should read:
“Yes and the unit cost to provide the NBN in Australia is at about $2000/premises averaged.”
“This idea that Telstra has cornered too large a share of the market for infrastructure competition to take place is complete nonsense. ”
Where have you been living for the last 15 years… under a rock? I’d point to documented factual cases of Telstra anti-competitive behavior, market monopolization, discriminatory business practices if I thought it would help you open your eyes but they appear to be so wide shut it would not make any difference.
*shakes head*
Yea, funny how most of the infrastructure rent goes to one company because everyone is busy raping the same piece of infrastructure. Can’t blame them really — why build competing infrastructure when you can access the incumbent’s at below replacement cost? Heck, it’s even cheaper for Optus to hook-up new subscribers to Telstra’s network than their own HFC!
And, damn Telstra! — you are not supposed to offer any resistance when you’re being raped; just keep those legs wide open, honey! How dare you hang on to your remaining 30% metro market share? Hand those cherries over!
Obviously, the only reason infrastructure competition works in other countries is because those countries never had “incumbents” that had “entrenched monopolies”. Telstra needs to build competing infrastructure and then hand them over to its competitors so they can “compete” — that’s obviously how telco markets work overseas.
“Can’t blame them really — why build competing infrastructure when you can access the incumbent’s at below replacement cost? Heck, it’s even cheaper for Optus to hook-up new subscribers to Telstra’s network than their own HFC!”
Wasn’t it a conditition of the sale of Telstra and being given control of the copper network that they provide access to others? So they accept it on those conditions and now you are crying foul?
“And, damn Telstra! — you are not supposed to offer any resistance when you’re being raped”
No, it was concentual. Another thing they were meant to do as a condition of sale is maintain that network. Sacking most of the staff who maintain it and letting it run down? Aren’t they raping their own network?
@ Noddy… And the fact that Telstra were fined $18m (iirc) for not allowing legal access proves they BROKE THE LAW and perhaps ergo their OWNERSHIP RIGHTS…
Wonder by them doing so, how network seizure would have gone down in a court of law?
Not that I am advocating or agreeing with this… But when silly fanbois makes silly comments as CYE did, sometimes reality bites.
But seriously with every comment you handful of anti-NBN posters here show your immovable allegiances to both the Coalition and Telstra. Obviously the former wins out, because even Telstra realise the NBN is a boon for all Aussies and RSP’ (including them self)…!
“There’s a reason why major telcos around the world all exhibit extensive horizontal and vertical integration”
Because most were the incumbents sitting on a gold mine, trying desperately to cling to their monopolies, like Telstra?
Look, nobody wants your precious Telstra hung, drawn and quartered, my the fanboi theatrics… we simply want them separated, to make it fairer.
But I do agree, you can rob from Peter to pay Paul in a vertically integrated situation. So since that risk aversion is impossible with separation, better leave it to the government, eh?
That way it’s fair all round. No risk for poor Telstra (sarcasm) and an even playing field for those not with the incumbent’s benefits
So what’s the problem?
How is structural separation going to make any difference? – Telstra have eight years to separate, you would hope the NBN has some hold by then in what ever form it is Labor or Coalition, so we are separating Telstra in the future scenario where residences will be forced off their copper infrastructure onto the new monopoly NBN Co infrastructure – why?
You think ISP’s will be all still clamoring for a better deal on Telstra Wholesale copper based DSL, PSTN and ULL in 2020?
LOL
Telstra have 8 years to separate.
And had the magic number been 8 months…?
You’d still be here whinging, but that it’s too soon.
*sigh*
You still have not answered the question, how will the separation of Telstra in eight years into separate wholesale and retail companies in a fixed line wholesale infrastructure scenario dominated by the NBN Co make one bit of difference to you or me?
1 vitally important way apart from anything alain:
NBNCo. are hiring Telstra’s ducts/holes/exchanges. Those ducts, once Telstra is separated will go to NCD department (wholesale) of Telstra. NBNCo. can then continue renewing leases for these ducts/holes/exchanges
If Telstra were to remain UNseparated, no doubt they would continue putting up the price, seeing as without the ducts/holes/exchanges, optic fibre in the ground or aerially really isn’t any good if you can’t access it…..
I can think of a few more, but I’m busy
So a structurally separated Telstra Wholesale Company with its own separate shareholder base it has to make profits for would not raise duct prices when the contract is up for renewal with the NBN Co but a operationally separated Telstra Wholesale company which is what we have now would – why?
As usual alain, you slip into childish mode and either accidentally or intentionally miss the point.
So, the point of the this part of the NBN (Telstra’s separation) is to rid us of the “current situation, which would have continued indefinitely”. I.e. Telstra having unhealthy control over Australia’s comms.
Without the NBN (and as I understand the Coalition plan, a somewhat similar future we have to look forward to, if they gain government) Telstra would have continued on their merry way with their control over Australia’s comms via their last mile network BUT also continued retailing as well. This to rational people (who aren’t political and Telstra stakeholders) equates to a HUGE conflict of interest.
However, until full migration occurs (over your 8 year period), Telstra will of course still be in control of the copper, so really WTF?
I should have clarified, the sentence was meant to read:
“If Telstra were to remain UNseparated, no doubt they would continue putting up the price, WHILE CONTINUING TO CHARGE TELSTRA RETAIL THE SAME, THUS ALLOWING TELSTRA A COMPETITIVE ADVANTAGE ONCE THEIR NON-COMPETITION CLAUSE FINISHES IN 10 YEARS, seeing as without the ducts/holes/exchanges, optic fibre in the ground or aerially really isn’t any good if you can’t access it…..”
From the lol files.
Not so long ago (like yesterday) some of the NBN critics were “still” telling us, we don’t and won’t need 100Mbps.
Now the argument is look what Verizon is doing, to argue private enterprise will do it
So private companies will now deliver… err, what we don’t need, won’r t need and even more?
*rolls eyes*
They’re just following Turnbulls example
http://i.imgur.com/mTxJW.jpg
:-)
Ha! Scumbag Turnbull!
That’s brilliant, I’m putting that up on Facebook.
Here’s another http://i.qkme.me/357d08.jpg
I’ll see your white elephant and raise you a wireless network.
http://i.imgur.com/Rpc1L.jpg
More here: http://delimiter.com.au/forum/national-broadband-network/345-turnbull-nbn.html
:-)
LOL!
HC, we should start an NBN parody site. Have sections- Scumbag Turnbull, Confused Conroy (“Nude” DSL), The Magnificent Abbott and his Amazing Political Backflips!….
Well if nothing else this puts a whopping hole in the old FTTN will be good enough argument.
Could somebody please email this to the liberal parties village idiot.
You know the liberal party leader that wants to destroy the NBN.
Just shows how wrong and lacking in future vision this guy really is.
We would sb, but seeing as Tony has admitted he’s “no Bill Gates” it would be easier to email it to Turnbull, seeing as he’d understand it.
Problem with that is, he has to support an idea, FTTN, he doesn’t believe in, because of his party. Why oh WHY Malcolm are you are Liberal!!??
Surely a private company rolling out fiber without government to hold their hand is impossible?
What’s going on here?
Only in Australia to residential areas. But we have already seen this. It has already been proven that there is zero infrastructure competition at this level, because there is no incentive to do to with an entrenched monopoly. So, your comment is a rather poor troll.
So you are saying that Opticomm never existed?
OPENetworks never existed?
Comverge Networks never existed?
… and the various others that strangely managed to connect more than 100,000 homes to fiber before the NBN prevented them connecting any more and thus moved the new houses back to Telstra copper connections.
Sound like this fibre networking is a lucrative business after all, imagine how successful a nation wide network would be with so much demand.
Yeah I am sure any of those companies listed above would not mind the taxpayer bankrolling their expansion into 93% of Australian residences and not only that bankrolling the shut down of all competitor fixed line infrastructure.
“blah blah blah taxpayer blah blah blah bankrolling blah blah blah I want copper to stay”
Stop your whining.
No one wants to do it if they aren’t the *monopoly* – there is plenty of failed (write-down) overbuild rollouts (HFC wars, TransACT, NCable, list goes on)
In the US I think these networks pretty much live off the near-universal penetration of pay TV. Imagine what would’ve happened here had Telstra been prevented from building their own HFC in the 90s..
Correct Matthew. No one wants to do it. That is why the government is stepping in.
The US telco’s DEFINITELY live off PayTV. Think about all the US shows you’ve ever seen that refer to “cable”. And if anyone has been to the US, you’ll know cableTV is almost ubiquitous. With over 300 MILLION people already buying cableTV, they’ve got a pretty decent stand on high risk ventures.
As you’ve said, had Telstra NOT put in the HFC, their payTV penetration would be considerably lower and they’d have much less revenue. Why else would they want to buyout Foxtel AND Austar? They’re not going to buy them out if they aren’t going to make money from them. They’re doing it because it allows them to bundle payTV in with net and phone, all across their HFC, which they’ve done nothing other than LITERALLY flip a switch for DOCSIS3.0 on for 10 years. It gives them more revenue for a once off capital investment. All they have to do then is watch the money roll in.
With the NBN in place, then they’d have to actually *gasp* work for their fixed line customers, as they’ve done in mobile.
Yes, and they are paying for it. Without access to low interest rate loans and the need to generate commercial ROI their prices are way higher than the NBN’s
Ask yourself why loans should have an interest rate at all? Surely the natural rate of interest should be zero and anyone who wants money just has to ask for it. I’m in favour, I’m fed up with working for a living.
If you can get a 0% loan, go for it. I hear Japan has plenty on offer.
Doesn’t change the fact that NBNCo had access to extremely low rate loans. Way lower than Verison can get. Maybe the US can just print some money for them, that is their usual way of raising capital.
What loans has the NBN Co raised and with who?
Bonds!
Educate yourself, please/
What bonds, how do I apply?
Here…
http://www.rba.gov.au/fin-services/bond-facility/#what-bonds-can-i-buy
Or from AMP who quite like them…
http://www.ampcapital.com.au/funds/infrastructure/core-infrastructure-fund.asp?_channel=2
http://www.bloomberg.com/news/2010-08-19/buy-utility-bonds-on-headwinds-for-global-economic-recovery-amp-says.html
Shall I hold your hand too?
Alex you must have met alians friend Stony Silence :-)
What’s the link between those bonds and taxpayer money pouring into the NBN build?
Dear sweet mercy save us all. alain, you asked where the loans were; you were told they were in bonds. You have asked where the bonds were; you’ve been given links to them to buy if you wish.
You’ve now stated, “What’s the link between those bonds and taxpayer money pouring into the NBN build?”
Which truly shows you DO NOT understand how the NBN is funded. It is NOT funded by taxpayer (ie TAXES) contribution, nor is it “free money”. The money is raised by companies and overseas governments BUYING those bonds, usually at a term of 10 years, though there are shorter and longer maturity bonds, and the money raised, is subsequently spent ON THE NBN as well as other government required equity spending. The interest on those bonds is known, for the set period and is paid at maturity of the bond. That money is usually carefully invested so it is available, for the known bonds payable at a particular maturity date, to be paid when the various bonds mature. The current rate for 10 year government bonds is 2.88%. Crappy, in terms of decent investment, however they’re that low because they are considered SUCH A LOW RISK INVESTMENT. Companies and other governments buy them KNOWING and almost guaranteeing a certain interest maturity payout at a specific time, so finances can be balanced across high risk, such as stocks, medium risk, such as gold and minerals and low risk, like the cash bonds issued to pay for the NBN.
If you cannot understand this, choose not to, or simply refuse to admit you are wrong BUGGER OFF!!
@seven tech
So let me get this right you are saying 100% of all NBN funding comes from bonds and nothing from taxpayer funds?
Please link me to a trust deed for a bond offering which has “NBNco” stamped as the offeror on the first page.
I never said such a thing alain. You asked where the loans were coming from. Currently, from government bonds. Once NBN picks up pace and needs more capital, it will seek interested parties. At a ROI of 7% it is not exactly eyebrow raising, but it is decent, low-medium risk return for entities like super funds, transport infrastructure companies and even the average large corporation looking to diversify risk.
You may not believe they will get the funding. I do. Neither of us can say otherwise until NBN seeks funding external from the government. One thing I do know however, is that the money DOESN’T come from the taxpayer.
Curb, you will not get one. There are VERY few bonds issued by a government under specific infrastructure. “Australia bonds” are the closest we get.
Don’t like it? Talk to the guys at Treasury, I’m sure they’ll be happy…..no wait that’s not the word….not care at all. Yes that’s it.
‘I never said such a thing alain’
Sorry you are starting to back pedal all over the place, you never said what exactly?
alain, please stop with the smart-arse, it’s wearing and achieves nothing. I am not backpedalling on anything and you know it.
You asked the question “So let me get this right you are saying 100% of all NBN funding comes from bonds and nothing from taxpayer funds?”
I answered, “I never said such a thing”
You may have taken it as an “inference” that I did not mention the $13 Billion slated from private equity, but I simply did not mention it because we were talking of bonds. But I never said, nor meant, 100% of the NBN would be funded by the government.
However, you STILL do not admit, seeing as $27Billion comes from government bonds (ie NOT the taxpayer) and $13 Billion comes from private investment (ie NOT the taxpayer) That we, as TAXPAYERS are not paying for the NBN with taxes.
@ alain, I epect explaining to one who has immovable motives such as your good self, to be a forlorn exercise, but I’ll give it a shot anyway…
Funding is NOT coming from general taxation, i.e. income tax revenue – so no, not from us taxpayers!
From the Parliamentary Library website… http://www.aph.gov.au/library
______
NBN funding sources and timing…
“During the NBN rollout, the Government will retain full ownership of NBN Co and funding will initially come from government equity. NBN Co will be funded via this equity until it has sufficient cash flows to support private sector debt. Government equity will be partly financed through the issuance of Aussie Infrastructure Bonds (AIBs). The 2011–12 Budget Strategy and Outlook states that AIBs will not be required until 2011–12, as Government equity will be met until then from the Building Australia Fund. Consequently, in 2011–12, the Government expects that $2.7 billion of the Government’s investment will be financed by AIBs.”
______
Another…
______
NBN funding…
Potential Government funding sources –
The potential sources from which the Government can obtain funding to then allocate to the NBN include:
General government revenue (for example, taxation revenue)
Borrowings (for example, through the issuance or sale of Government securities/debt),
Existing assets (for example, existing Government funds).
Combined, the potential funding sources available to the government represent a resource pool from which it can then allocate funding to the NBN. The funding allocation to the NBN is derived from summation of all identified allocations. These identified allocations are attributed to the following:
Identified NBN funding sources and allocations
• Building Australia Fund (BAF)
• Contingency reserve account
• Existing and/or additional issuance of Commonwealth Government securities (CGSs) as part of the Government’s general debt pool, and
• The proposed future issuance of NBN specific Aussie Infrastructure Bonds (AIBs).
_________
You will note – and argue all you like about The Contingency Reserve and BAF (which includes funds from the sale of Telstra iirc) as I’m sure you will “need to” – but let’s READ IT AGAIN, together…
GENERAL GOVERNMENT REVENUE (FOR EXAMPLE TAXATION REVENUE) IS NOT AN IDENTIFIED SOURCE OF NBN FUNDING.
So no more childish questions please, it’s all there.
FYI – CYE, as you should already know, NBN specific bonds are not currently available. So invalid argument or cheap shot….
As such, part of the past and current general issuance bonds/securities has been/is being channelled into the NBN build.
http://delimiter.com.au/2010/05/11/budget-2010-govt-to-issue-300m-of-nbn-bonds/
“The budget papers added the NBN bonds would not be separately identified from normal Commonwealth Government Securities at the time they were issued”…
http://www.smh.com.au/business/government-goes-global-to-raise-3b-needed-for-national-network-20110710-1h91o.html
“However, investors who buy Australian government bonds will not know that their money is going towards NBN Co’s fibre-to-the-home project because the government’s financing arm is rolling the infrastructure bonds into its general issuance program”.
Iirc NBNCo plan on issuing NBN specific bonds in 2015. Once the NBN is out of the initial developments stages (and of course if the NBN isn’t vandalised by a new government headed by idiotic, ideological, ultra-conservatives).
Of course the stark difference as pointed out by many with the Verizon 300Mbps rollout in the USA and the NBN here the USA taxpayer doesn’t wear the risk, Verizon does, and it get to choose within which areas of the USA it will offer it, it won’t offer it into areas that their research has shown won’t make a buck or where there is too much existing competition from other carriers.
I don’t mind Verizon or any Telco coming into Australia and offering 300MP’s FTTH then I can choose if I want it or not knowing I didn’t pay for it with my taxes anyway – and if costs exceed revenue I don’t care.
That’s what happened with Telstra and Optus when they selectively rolled out HFC into the lucrative high density areas of our main capital cities offering the highest speed BB available, the problem was most punters the HFC passed were happy with ADSL speeds or wireless BB and are still are.
Those residences that are happy with HFC will be have to be ‘happy’ with the NBN, that’s because the HFC BB is being switched off by giving billions to their respective owners by our Government forcing HFC BB residents onto the NBN, that helps the NBN justify its existence – see ‘everyone needs it’.
That’s right — not only do Optus HFC subscribers have to pay the cost of a brand new fibre connection, they also have to subsidise all those money-losing satellite, fixed wireless, and regional fibre subscribers.
To add insult to injury, they will also have to pay NBNco back the $800mln in HFC buyout costs for the “privilege” of being denied usage of newly-upgraded 100mbit HFC.
Oh, and I forgot the Government’s 9.8% equity return on top of all that.
Ditto for Telstra broadband subscribers — what a deal for consumers!
Three cheers for Rod Sims and the ACCC!
Hip, hip, hurray!
(We’re the laughing stock of the world.)
That’s right, throw figures around to show how it is more expensive. But, shhh, don’t mention reality, because in reality the plans a cheaper.
Especially when the NBN Co is subsidising the true costs with a CVC rebate per residence because the ISP’s said ‘waa that’s too expensive’.
Will that be detrimental for NBN Co revenue?, sure it will, but hey we have to get the punters to buy it somehow, especially in the pre ‘shut down of competition era’ of high speed choices.
“Especially when the NBN Co is subsidising the true costs blah blah blah”
When will prices rise and how much will they rise by. Answer the question or get out.
“especially in the pre ‘shut down of competition era’ of high speed choices.”
What “high speed choices” are being shut down?
Remind me again when HFC was going to be rolled out in the Illawarra? Or Newcastle, or (and willing to be corrected on this one, admit its a stab in the dark) the Gold Coast.
The key players (Optus and Telstra) had their honeypots, they had absolutely no interest in rolling out infrastructure elsewhere. You’re beloved competition failed. Simple as that.
With NBN, that competition has been reset to an even playing field. No duopoly dictating the rules, there are more players. Surely, thats better for your beloved competition, isnt it? 5 companies competting nationally for the retail aspects has to be better than 2.
You missed the argument altogether, deliberately I suspect, the point was HFC BB didn’t make money because residences didn’t need HFC speeds otherwise Telstra and Optus would have had 100% take-up, even in 2012.
It galls the NBN lobby that residences are happy with ADSL and ADSL2+ in 2012 and beyond, I keep asking what residences that have FTTH today can do that HFC or ADSL2+ residences cannot, it’s met with a stony silence.
HFC would have had 100% take up in those areas if the ADSL was forcibly shut down, that’s how the NBN will work.
So for the umpteenth time I will ask the unanswered question alain.
Why do you care that HFC which you openly admit is not needed or wanted, will be shut down? You can’t keep having it both ways.
No you haven’t been met with stony silence at all, I have many times asked of you, using your “own logic” what can you do on ADSL that you can’t do on dial-up?
Ergo, are you using dial up to back your own claims? If not you answer your own, rather ridiculously childish question.
‘Why do you care that HFC which you openly admit is not needed or wanted, will be shut down? You can’t keep having it both ways.’
That’s not the argument., you know that so you pretend it’s about something else that you made up then make a ludicrous statement based on a blatant falsehood ‘You can’t keep having it both ways’.
‘I have many times asked of you, using your “own logic” what can you do on ADSL that you can’t do on dial-up?’
The jump from dial-up to ASL2+ is the same as the jump from ADSL2+ and HFC, especially 100Mbps HFC to NBN FTTH – really?
That’s not using my ‘own logic’ at all, that doesn’t have any comparison logic.
Yes, that’s about it. The jump to FTTH is of those orders of magnitude. Those old technologies will not get to 10Gb+ speeds to the home. Currently, like ADSL offered 1.5Mb max and HFC was not offering 100Mb (peak) in the begining FTTH is offering plans up to 100Mb.
Why do I need FTTH for email and voice calls?
You don’t. Are you really so short sighted you cannot see future increaes? Where you one of the people who stuck to dialup because there was no need for more? Did time move on and data volumes increase til dialup was virtually useless? Well it’s going to happen again and it would be good if it had room for even further growth. 50 years is a long time. 50 years ago ICs contained a few transisters, like 3or 4 of them. Now they contain 3-4 billion, a 1,000,000,000 times increase. 30 years ago 128KB was a lot of memory, now a lot of memory is something like 32GB, a 256,000 increase. 10-12 years ago, 56Kb was a fast modem, now it’s 24Mb, a 5000 times increase.
Somehow magically growth is going to halt? Well it has for 10 years in broadband, data volumes and computer capabilities have not and 24Mb peak is becoming a big bottleneck and that is if you are lucky, most get under 6Mb and can’t even stream a movie.
Sorry, 56Kb to 24Mb is 500 times increase
@Noddy
So let’s look at your 10-12 years time frame on BB technology being made redundant by application demand, so in the year 2000 did anyone predict that HFC and ADSL2+ would be inadequate in 2012 and beyond?
‘and 24Mb peak is becoming a big bottleneck and that is if you are lucky,’
It is? – in that case it makes you wonder why everyone that can only get up to 24Mbps speeds on ADSL2+, and I agree the national average is much lower at 8-9 Mbps are not on HFC if it is available to them.
“So let’s look at your 10-12 years time frame on BB technology being made redundant by application demand, so in the year 2000 did anyone predict that HFC and ADSL2+ would be inadequate in 2012 and beyond?”
I am sure some thought it would be adequate some thought it wouldn’t be. I am sure some thought it’d be good for 50 years, but a lot of people put their foot in their mouths predicting something will be sufficient, they are invariably wrong and their 640K is obsolete in a few years.
What time frame do you put on ADSL2+ and HFC before they are near useless? 10 years maybe? About the time of the rollout? Some people are already hitting limits and investing in bonded DSL and 100Mb HFC, if they are available just to meet their needs. In 10-12 years time you don’t see ADSL2+ as the equivalent of dial up? History has proved those sort of predictions wrong over and over.
“It is? – in that case it makes you wonder why everyone that can only get up to 24Mbps speeds on ADSL2+, and I agree the national average is much lower at 8-9 Mbps are not on HFC if it is available to them.”
It is not available to that many people. Even if the cable runs past your place it may not be available. Once connected 100Mb also isn’t the speed you get unless you do all your usage at 4am
Or are you saying a small percentage of the population is the majority because you happen to have cable?
Anyway, even if you do get 100Mb on cable, that’s a speed increase of 4x, only about 100x more to go over the next 10-20 years. Oh, isn’t that strange, that is exactly what FTTN promised, 1Gb then 10Gb, and at a stretch, cutting HFC into small lengths and running extra fibre to boxes to service that HFC will make, what 300Mb, aww how sad. Anyway, this thread is probably getting a bit long for your Commodore PET, better get another 16K for it alain
“Why do I need FTTH for email and voice calls?”
You don’t, so get a mobile and stop your whining while the rest of us make use of the faster speeds now. When you are done having your tantrum you can join us any time you like since NBN fibre is rolling out to 93% of Australia you’ll be able to do this when you eventually change your mind. Thank those that are can see beyond a few years for the conveniences you will enjoy.
Erp typo, FTTH promised 1Gb and 10Gb speeds in the next 10-20 years. FTTN offers a dead end like HFC.
ROFL…
alain you just told us HFC is not popular and “didn’t make money”.
Yet you also say it shouldn’t be shut down.
That is at best, idiocy!
Alain writes “It galls the NBN lobby that residences are happy with ADSL and ADSL2+ in 2012 and beyond, I keep asking what residences that have FTTH today can do that HFC or ADSL2+ residences cannot, it’s met with a stony silence.”
Try this:
Residence A has 100mbit FTTH with two adults and two teenagers living there. There are two desktop computers, two laptops and two ipads all internet enabled. Let’s say three of the four are all on the internet doing their thing at the same time, downloading whatever/youtubing/streaming a rental movie/browsing/facebook/plus anything else at the time. With 100mbit FTTH, no problem as there is plenty of bandwidth to go around so speeds are NOT impacted.
Residence B has ADSL2+ up to 24mbit (most likely throughput speed of 10mbit or less) with two adults and two teenagers living there. There are two desktop computers, two laptops and two ipads all internet enabled. Let’s say three of the four are all on the internet doing their thing at the same time, downloading whatever/youtubing/streaming a rental movie/browsing/facebook/plus anything else at the time. With ADSL2+ up to 24mbit (most likely throughput speed of 10mbit or less), huge problem as there is a huge lack of bandwidth to go around so speeds are GREATLY impacted.
So one or two of them are told to “get off” and wait their turn. This scenario would also repeat itself on many HFC customers as the vast majority don’t get anywhere near 100mbit throughput on their connections.
And the 100mbit current top speed tier is only the beginning with 1000mbit speeds (and higher) in the future. I’m scheduled to get FTTH starting in March 2014 and look forward to the whole family being on at the same time with my 100mbit FTTH connection. BTW I live in a regional center of 21000 people.
Bring on the NBN and stop pussy footing around.
@Avid Gamer
But we can rig up Residence A-B scenarios all day depending on the outcome we want for our agenda.
How about we say Residence B wants a infrastructure facility for voice calls and occasional emails and is currently using 1500/256 and a Telstra Homeline PSTN plan and its fine, see I rigged it for the outcome I wanted.
The point is of course why do residences that can get HFC choose ADSL and why do residences that can get ADSL2+ stay on ADSL1 1500/256 or lower?
Some don’t have a choice. Some took out their plan years ago and don’t realise they can get more for less. 1.5Mb is not cheaper than ADSL2+ so there is no reason other than ignorance or unvailability to not upgrade.
But of course there could be a totally legitimate and valid reason but you don’t really want to go there – they don’t need greater speeds than 1500/256.
But how much of the population uses copper ONLY for email and phone?
More to the point, how much of the population do you see continuing to only use a telcoms line for only email and voice in the next 20+ years.
In my opinion, basing national telcoms infrastructure planning on the needs of the older generation (which is who I presume you’re refering to) is backwards and shortsighted.
Maybe there are people that don’t but who cares if the alternatives aren’t more expensive? Do you only buy cars that can do 100km/p because more is a waste even if they are the same price or cheaper?
you are right mike even my late grandmother (bless her) was using the internet for more than just emails and all these things will be be taken for granted in 20 yrs if not sooner
I’m not missing any part of your ‘argument’ alain, just asking a question of you. You ask “what residences that have FTTH today can do that HFC or ADSL2+ residences cannot”, and I ask in return what about the premises that dont have FTTH or HFC?
When am I going to get HFC or FTTH under your idealology? I’m rural, living in a region of around 450k, yet the best connection I can get delivers 6Mps. Shared with just ONE computer, I lag, and do not get what I expect or need from that connection.
Is that too subtle? I WANT A FASTER CONNECTION. Very very simple. Yet under your mentality, its tough luck to me. Should I go out and pay thousands to get a dedicated fibre line run from the local exchange to my house to deliver that connection?
Its not a rural village of 50 people, its the 8th or 9th largest city in the country. I also listed the biggest and 2nd biggest non capitals as well, they’er in the same situation – ignored by HFC and FTTH so far. So again, when would I have seen HFC if the NBN hadnt come along? A question I have repeatedly asked, and been ignored every time. Again, competition failing to deliver outside its cherry picked honey pots.
When was I going to get better than the ridiculous connection I ‘enjoy’ currently? Its not a hard question.
That leads to what you rabbit on about – what does it deliver thats better than current HFC or FTTH clients. The answer is pretty simple, I’m surprised even you hadnt figured it out yet. Not much from the clients point of view.
Missing something so simple, I’m surprised you dont work for the Liberal party. Or maybe you do… But you miss the point the NBN crew keep stating. If you’re going to be supplying that same level of service, because those that went part way refuse to keep going, its just as easy to replace what they have when you get there.
What does that mean? In laymans terms, at some point the technology in place right now will be replaced so its the same as every one else. Its consistent. So servicing for starters will be guaranteed to be the same as for everyone else. Upgrading will be the same as for everyone else. Things like churning from one ISP to another will be the same as for everyone else.
Those 3 simple things alone give benefits.
Could they be left in place? Certainly, I’m not saying they couldnt. But that just muddies the water, so why leave the temptation? Ask yourself this. If there are 400,000 people on Optus, being encouraged to upgrade to NBN, what does Optus do if just half change to fibre? They suddenly have HFC running past 2 or 3 million people, with at best 10% connecting. How is that profitable for them to maintain? Nobody is going to step backwards, are they?
Happily, for me, I can ask the questions, knowing the answer. I get NBN by about the middle of next year, so the answer under Labor is July 2013. My local exchange is starting its build next month, I will connect to a 50Mps or 100Mps connection, depending on cost. Probably 100Mps, I can get that and a phone line for what I’m currently paying, with only a small drop in bandwidth which I dont use anyway.
alain, I think there is a failure to comprehend
“You missed the argument altogether, deliberately I suspect, the point was HFC BB didn’t make money because residences didn’t need HFC speeds otherwise Telstra and Optus would have had 100% take-up, even in 2012.”
The HFC was designed in the early 90’s for Cable Television and Telephony with isdn level broadband. NOT for BROADBAND. As such even by upping the node feeder to provide the “up to 100Mb” it is still limited by contention. Note they have more customers than BB customers on the HFC. They are Foxtel only subscribers.
As many have stated, Even though the HFC is running down the street, so often Optus or Telstra refuse to connect on HFC,(As happened with myself and several neighbours), instead insisting on ADSL instead as that node is overloaded during peak times.
So IT IS NOT that customers don’t want better than ADSL, Rather the HFC cannot provide and is denied to try and maintain a reasonable standard. The percentage connected would be the max percentage for reasonable service determined by the operator.
The nodes and feeder fibres will need to be tripled, What is involved in doing that “minor upgrade”
“To add insult to injury, they will also have to pay NBNco back the $800mln in HFC buyout costs”
yep imo that’s actually the worst part of the NBN, paying so much money for utter rubbish. It makes no sense at all to pay this price for redundant technology, it isn’t even capable of 1000/400mbps speeds like fibre.
“(We’re the laughing stock of the world.)”
We will if we roll out FttN and still rely on the redundant copper for broadband.
@ CYE, by we’re the laughing stock of the world, was that in relation to your and the previous comment you replied to?
If so, yes.
“and it get to choose within which areas of the USA it will offer it, it won’t offer it into areas that their research has shown won’t make a buck or where there is too much existing competition from other carriers.”
Now you know why the NBN exists.
“I don’t mind Verizon or any Telco coming into Australia and offering 300MP’s FTTH then I can choose if I want it or not knowing I didn’t pay for it with my taxes anyway”
Still whining about taxpayers, moving on…
“the problem was most punters the HFC passed were happy with ADSL speeds or wireless BB and are still are.”
lol makes you wonder why they are now offering 100mbps plans at all.
People watch cable tv and can download any movies they want to watch in america via netflix etc which is why people need such large pipes.
Never going to happen over here
I would like to issue a challenge to anti-NBN devotees.
In order to show that you are not totally subservient to Tony Abbott’s one sided arguments about everything, try and come up with something positive about the NBN. Just a little something, just to show that the world is not totally black or white.
I am sure, for instance, that your are not always disingenuous, poor debaters, or condescending. I have no doubt you have some redeeming traits.
That reply constitutes ‘great debate’ does it?
Jeez that was easy eh?
Unfortunately for you, yes.
Communication that is one sided does not represent a debate, merely, a biased or uneducated statement.
As a bonus, long established research in persuasive communication, has repeatedly shown that two sided arguments are more likely to be taken on board that one sided ones.
But then again, it your aim is to ‘destroy’ rather than debate, then you are on a winner with one sided arguments.
Finally, I was going to say ” no need for sarcasm” but then again looking at this effort, I realised you really need the practice.
Well instead of theorising with glib meaningless throwaway lines engage me in the debate on the subject matter in hand as others are doing disputing any of the points I have made so it’s not so as you assert ‘one-sided’.
All you have asserted is meaningless, unsubstantiated drivel alain and as soon as you are questioned you can’t escape quick enough.
Yet you show up elsewhere blurting out the same BS…
NEWSFLASH – this is an evidence based forum not a political Fudfest.
So how is that bond link going then?
Good…
You’re not paying attention again.
http://delimiter.com.au/2012/06/01/us-telco-verizon-launches-300mbps-unlimited-fibre/#comment-438825
Don’t forget to answer my question ;-)
I did.
You did, what in your world or actual reality?
You missed this question:
http://delimiter.com.au/2012/06/01/us-telco-verizon-launches-300mbps-unlimited-fibre/#comment-438241
Twice. I can only conclude you are avoiding it just as you are avoiding every other question asked of you.
Again, you are showing a lack of understanding of what a debate should be.
It is not about dimwits each pushing the own one sided point views. This ends up being a meaningless exercise. I realise this is the norm in politics but it is hardly great evidence of debate.
The reason I could not be bothered to debate you is simply because it is futile.
I am yet to see you concede any point or any positive about the NBN, no matter how logical or benign. This is a great approach in high school debating contests but a waste of energy in the real world.
By the way, you responded to my post, deriding the point I was making rather than rebutting it.
Quit while you are behind.
I concur observer.
If they aren’t 100% biased (as we acknowledege the NBN isn’t perfect) they could do it easily. because realistically, the NBN can’t possibly be 100% wrong.
And… if they can’t find even one positive, it shows they are exactly as you said, political minions.
FYI however – I have done likewise in the past (due to their blind NBN hatred) and asked them for “their” NBN alternative, for us to peruse, but so far nothing, zero, zilch…. but continued NBN FUD of course.
Again reaffriming their minion status.
I’d suggest, the normally mouth few will go suspiciously quiet.
Funny thing observer I was considering posing this exact same question in the Delimiter forum at one stage but I quickly realised it would be pointless. You see the main problem is the majority of the anti-NBN crusaders are only against it for political and emotional reasons unfortunately overriding any logical reasons. They do know the NBN is the best option we have (explains why many coalition members are in favor of it now) but they can’t see past that at all. Asking this question is like asking a creationist to look at evidence that supports the theory of evolution. They are not going to understand it and deride it as much as they can since it challenges their fundamental beliefs.
I find it laughable that national broadband naysayers like “Curb Your Enthusiasm”, who is not prepared to put his name to his assertions, refuse to recognise that cross-subsidy of wholesale infrastructure by a government operator is the economically optimal solution when universal and uniform service availability is a natural good for the society and the economy.
It is different from Telstra’s request for taxpayers to subsidise its profit.
And remember that we are talking about 85% paying a little more so that the most costly 15% have a service.
When regional areas have the service, city businesses benefit from rural customers being able to use their low-cost sales channels, health budgets benefit by relief of demand on hospital beds and reducing travel to be reimbursed by governments and insurers, familiies stay in touch more cheaply. These are real benefits to the 85% as well as the outlying parties.
So if it cost $10 to build per person for that 85%, and $15 to build for the remaining 15%, are you saying that its OK for that 85% to pay an extra 75c to subsidise the remainint 15% so they all pay the same?
For shame! Thats like expecting that 15% to pay the same as the 85% for milk even though they make it all. Oh, wait…
The math isnt hard.
85 x 10 = 850
15 x 15 = 225
850 +225 = 1075
1075/100 = 10.75
Dont worry Francis, I agree with you totally. Urbanites expect parity when they get the benefit, but not the other way around. Most city folk dont realise its the rural crowd that sort of supplies all the meat, vegies, fruit, milk, etc, subsidising in exactly the same way that city folk do for urban developed products. Like technology.
Another indirect benefit of cross-subsidising rural areas is that by doing so, the pressures on regional residents/businesses to move into urban centres is reduced. Our cities are getting too big and regional areas have enough trouble keeping their populations growing as is, without introducing another huge incentive to move away.
Under Labor’s NBN, people and businesses in places like Armidale in NSW or Shepparton in VIC will have access to exactly the same quality of services for the same price as those in Sydney or Melbourne. Something like that would never happen under the US-style free market broadband setup.
Wow, it literally took me 40 mins to read all that. I’ve only been out for the day!
Curb and alain particularly, but also any anti-NBNers out there with this attitude evident, I would ask you this simple question:
Can you tell me what is the Coalition’s BB plan?
– I would like to know what % of premises will get 100Mbps, 50Mbps, 24Mbps, 12Mbps or less.
– I would like to know how they are going to achieve this in the same or less time than the NBN, given they must wait until AT LEAST July 2014 to (possibly) gain control of the senate to change legislation surrounding the NBN.
– I would like to know an ESTIMATE of the cost (I am fully aware without treasury access, it is difficult, but large accounting firms can give estimates….although maybe after last time I see why they’re hesitant….$10 Billion black hole anyone?…) INCLUDING any cost associated with finishing the NBN where it stands, renegotiating contracts, the CBA they insist on AND what the ACTUAL cost of rollout will be.
All these I have answers for on the NBN. If you can answer any of them satisfactorily (not subjectively, OBJECTIVELY. ie, an attempt to explain how you got to that number/assumption I will accept) I will believe you are willing to debate on the NBN.
Until then, you cannot under any circumstance argue against the NBN on the premise of a “better” alternative, as there would BE no alternative to compare it to. And “the growth of the current market” is not a valid answer. The market has failed the majority of Australians. Whether you are willing to accept that is irrelevant. It has been proven by anecdotal, parliamentary, legislative and independent evidence.
You may continue to argue against the monetary outlay of the NBN. Although I’m not sure that would prove anything as if we do nothing, we do indeed spend nothing….and get nothing for it.
Please do not insult Regional Australia again, as you have been doing. You would not be eating cheap meat, milk, bread and many other items without them. Yes, you could eat, at about twice or 3 times the price. They deserve fast ubiquitous BB access, just as you do.
Thankyou
P.S I forgot Fruit and Vegetables….man, no wonder I’m getting fat!
Other than what has been stated already I don’t know what the Coalition Policy is and in June 2012 I don’t really care because there is not a election due until the second half of 2013.
A couple of points that bear repeating because you have asked the direct question, Labor went into the 2007 election with one plan and changed their minds after they won and implemented something different, so with that precedent set the Coalition could announce a plan in say June 2013 wait till they get into power and implement something different – you ok with that because that’s how the current Labor NBN scheme started.
Update:
There you go, that’s the direction the Coalition are heading in.
http://delimiter.com.au/2012/06/05/coalition-will-complete-nbn-objective-says-turnbull/
What direction alain? There IS NO INFORMATION in this. It says “we will continue the mandate of the NBN, but faster and quicker”. The NBN, changed at ALL from full FTTH to FTTN, which is undoubtedly their plan, otherwise it couldn’t be cheaper, would not uphold its’ mandate BY DESIGN. If less people than already are included in the 93% don’t get FTTH, the digital divide gets bigger and more and more Australian’s get stuck with no upgrade path whatsoever.
I’m glad you don’t care your political party has no policy for what you’re arguing so fervently for right now….it shows you don’t ACTUALLY care what the policy is, you’ll vote for them anyway.
Well don’t vote for them if there is no more detail forthcoming that you agree with going into the 2013 election, it doesn’t particularly bother me the full detail of Coalition policy has not been published in June 2012.
BTW between you me and the gate post Coalition NBN policy will make no difference whatever to the election outcome, and you all know that, but hey for the purposes of keeping the discussion alive going into the next election we can all pretend eh?
“BTW between you me and the gate post Coalition NBN policy will make no difference whatever to the election outcome, and you all know that, but hey for the purposes of keeping the discussion alive going into the next election we can all pretend eh?”
Stop talking rubbish alain. ALL policies make a difference, if they didn’t, we wouldn’t have independents and Greens. EVERYONE would vote for the economic way of doing things or the socialist way of doing things. There would be only 2 parties…..oh but wait, that’s right, we had a hung parliament…..
The fact that you don’t care about your party’s policy shows how much of a total political sap you are. I will not be voting for Labor because I like Labor, the same as if I were to vote Coalition. I LIKE their policies, including the NBN, the carbon tax AND eHealth. Should the Coalition change their tune on any of these, I would subsequently re-evaluate.
I do NOT vote on loyalty. Why? Have you LOOKED at the people we’re voting for?? Why on this large, round, mainly sane planet would I give THEM my loyalty??!!
“Other than what has been stated already I don’t know what the Coalition Policy is and in June 2012 I don’t really care because there is not a election due until the second half of 2013.”
But haven’t you have argued the Coalition’s plan is better, even though you just admitted you didn’t even know their plan…? ROFL.
Malcolm pats alain on head.
BTW, if the Coalition gain power with one broadband option but, like Labor, find out through due dilligence and expert advice that their plan is foolish and change their minds, I will congratulate them, not ridicule them.
Changing one’s mind for the absolute better, is ok, in fact prudent and advantageous. You ought to give it a try…even once!
But haven’t you have argued the Coalition’s plan is better, even though you just admitted you didn’t even know their plan…?
No, I said ‘other than what has been stated already’, they have added a bit more today with that article by Renai, but it still won’t be their final 2013 election policy and they have heaps of time to tweak it or change it 100% if they want.
I’ll review it pre-election 2013 like every voter with a objective view should, it is possible to vote for Labor but not agree with their NBN policy, and also vote for the Coalition because the NBN is irrelevant as to why you voted .
BTW If a election was held this Saturday the Coalition would win without adding anything to their NBN policy, they could even win announcing they don’t even have a ‘NBN’ policy and they will wing it later, that’s the unfortunate truth for the pro NBN supporters who swamp web sites like this with their spin, but it’s the grim reality.
Oh you haven’t said that.
So you have just bagged the current NBN plan 24/7, for no reason then, as YOU have had no better alternative to judge it by! Thanks for the frank admission of your obvious, anti-NBN motives.
Although looking at Turnbull’s latest NBN succumbing, he’ll make you look very silly indeed if he keeps edging towards total NBN capitulation…!
Luckily for us NBN supporters there isn’t an election this weekend so invalid point and wishful daydreaming imo.
And I still ascertain the NBN may survive due to people’s disliking of Abbott (again any odds on the next election being fought between 2 different leaders to those currently in charge)?
Well you say the NBN might survive because of the dislike of Abbott, but according to the latest Age/Neilson poll Preferred PM has Gillard at 44% and Abbott at 46%, so on that basis you could quite easily say the NBN won’t survive because of the dislike of Gillard.
You need to look at the primary percentage and two party preferred percentages to determine who might win Government at the next election, if the current polling trend continues, and it has for quite a while now with minimal shift in percentages, Labor has to be very worried.
*sigh*, for someone who hasn’t said he’ll vote Coalition, with all that quacking and waddling, one would suspect – “duck”.
Anyway, you miss my point in again jumping to the defence of the party you may not vote for.
Yes Labor is on the nose, yes Gillard is on the nose – we all know that. But even so, Abbott is more unliked now than he ever has been and although (if as you say is correct) he’s ahead in the disapproval rating, I beieve his approval rating is behind Gillard.
When Labor were in the same cosy polling position the Coalition now are in, a few years back, Rudd’s popularity was at all time highs in the polls (+70% iirc) and disaapproval rating minimal.
instead of getting all defensive, just admit Abbott is still a liability and Labor’s best chance of re-election. But bring in Turnbull and Labor are gone (unless they reincarnate Rudd…lol).
*bangs hands against ears* la la la la la!!! Too much politics!!! la la la la
:D
Sorry, hate this crap. THIS is why Australia is behind in many areas, because of this bollocks we go through pandering to the lowest common denominator.
No alain, I wasn’t insulting you, it was a general observation, not specific.
“BTW If a election was held this Saturday the Coalition would win without adding anything to their NBN policy, they could even win announcing they don’t even have a ‘NBN’ policy”
LOL You read it here everyone, the coalition dont have to put together a broadband policy at all. They dont actually have to care about improving broadband speeds because blind zealots like alian here will vote for them REGARDLESS… of course the rest of us have higher standards.
“and they will wing it later”
Winging is what they’ve been doing so far so I wouldn’t expect this to change either…
I have never said I would vote for the Coalition ‘regardless’.
LOL…
Yep, it’s certainly not going to be FOR their broadband plan, you’ve just admitted they dont need one for your vote. So no more FttN patchwork endorsements from you please.
“BTW If a election was held this Saturday the Coalition would win without adding anything to their NBN policy, they could even win announcing they don’t even have a ‘NBN’ policy and they will wing it later, that’s the unfortunate truth for the pro NBN supporters who swamp web sites like this with their spin, but it’s the grim reality.”
That’s the….10th? time you’ve stated that? I notice Abbott is getting very close to being as unpopular a leader as Gillard however and, as you say, there’s still over a year to go….
This “unfortunate truth”….yes, so why are you bothering to try and “correct” our “reality” then if it doesn’t matter? Are you bored?
“Perhaps we could also learn from the USA where the Obama administration has announced their version of a Government supported NBN – it’s 4G wireless.”
Ahh, check your sources alain. This BB “policy” is ACTUALLY part of a larger overreaching policy. The wireless segment accounts for 10% of the total cost….not exactly an NBN “based” on 4G wireless….
Seems to be all about wireless to me.
‘WASHINGTON—President Barack Obama will today detail his plan to win the future by catalyzing the buildout of high-speed wireless services that will enable businesses to grow faster, students to learn more, and public safety officials to access state-of-the-art, secure, nationwide, and interoperable mobile communications.’
http://www.whitehouse.gov/the-press-office/2011/02/10/president-obama-details-plan-win-future-through-expanded-wireless-access
That’s great, with wireless networks like this on the rise we can shut down old redundant copper networks with no consequences. We can also replace those copper networks with fibre and improve fixed line and wireless services in one go.
Sorry USA policy is not about shutting down existing working infrastructure either copper or HFC by giving their owners billions to do so so that their own Government policy has a chance of survival by forcing residences onto it, Australia is unique in the world doing that.
“Sorry USA policy is not about shutting down existing working infrastructure either copper or HFC ”
It makes no difference, you are so sure 4G is all anyone needs so shutting them down would actually be a good idea not a bad one…
“forcing residences onto it”
Currently I am forced to use copper, I would LOVE to be forced to use fibre and the rest of Australia would too, Sorry but YOU are in a minority against the NBN.
“Australia is unique in the world doing that.”
Australia is doing the right thing, you should be happy about this, stop your whining.
“Seems to be all about wireless to me.”
alain, you are choosing, once again, to filter out what you don’t want to hear. There is NO mention WHATSOEVER of fixed-line infrastructure in this release because IT IS NOT A BROADBAND POLICY. It is a MOBILE WIRELESS policy. The US are struggling under the lack of available spectrum and this is Obama’s fix.
How about you google US fixed-line broadband and read some numbers….13.5Million on FTTH already, about 13% of ALL premises….and that was in 2010….
http://www.budde.com.au/Research/2010-USA-Telecoms-Wireless-Broadband-and-Forecasts.html
4G wireless is not about USA broadband policy really? – hey you better let Telstra know, they are spending billions on their LTE rollout and it’s only going to be used for voice calls and SMS.
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