This article is by Shadow Communications Minister Malcolm Turnbull and was published tonight in response to Delimiter’s article today on the superfast broadband report issued by the UK’s House of Lords this week (PDF). It first appeared on Turnbull’s website.
analysis Delimiter has published a curious response to a UK House of Lords report on broadband policy released this week.
There are three key takeaways from the study, each an unwelcome truth for supporters of Labor’s NBN policy. The Lords’ first point (pages 24-27) is that the overriding reason for policy intervention in the first place is to provide access to fast broadband in areas it won’t reach on purely commercial terms: “Government policy on broadband should be driven, above all, by the social benefits it can unleash, and the need to arrest and ultimately reduce a damaging digital divide.”
Yet in Australia, Labor denies public investment to upgrade broadband requires non-commercial economic or social ‘spillover’ benefits to add up, instead claiming the NBN is commercially viable (and its costs can therefore be kept off the Budget). It plans to overbuild commercial infrastructure capable of providing good broadband for years to come as well as upgrade non-commercial areas. And Labor has paid no attention to affordability – according to NBN Co, monthly revenue per user will double between 2012 and 2021, entrenching rather than reducing the digital divide.
The Lords’ second point (pages 31-34) is that broadband policy frequently falls into a “speed trap” – too much attention is paid to particular download or upload targets, and not enough to ensuring access is ubiquitous and affordable, or expanding the beneficial ways the network can be used: “We recommend that future broadband policy should not be built around precise speed targets end-users can expect to receive in the short-term, however attractive these may be for sloganeers.”
The Lords urged broadband policy to work to a horizon of at least ten years and include an upgrade path towards the eventual goal of FTTP. But lack of existing uses for the speeds offered by such a network pointed to a need to “set out an even bolder vision for broadband policy than is currently the case.” Again, the contrast with Australia is clear – our debate has focused intensely on the high speeds available over FTTP and their purported (but seldom demonstrated) benefits, and barely at all on the decade or longer many users must wait for adequate broadband.
Finally, the Lords’ recommended (referring to the UK’s specific circumstances) that government should for now focus on pushing open access fibre backhaul closer to users, and leave the private sector take care of the “last mile”: “We recommend… the Government undertake to produce detailed costings of our proposal, not least because our proposal removes the final mile—the most expensive per capita component of the network—from the costs requiring public subsidy.” (page 21).
This is the polar opposite to Australia’s NBN. The Lords provide three reasons for not offering public subsidies for the last mile:
- It is incredibly expensive – up to 75 per cent of costs.
- In the UK there is an emerging competitive private market in last mile infrastructure provision. Contrast this with Australia, where Labor’s NBN has been granted a statutory and contractual monopoly over the access network.
- Governments shouldn’t dictate which technology suits each community – local authorities, residents and businesses should invest in whatever matches their needs.
The report anticipates the “emergence of a new industry of infrastructure providers in the final mile who will be able to respond to local demand and compete effectively with their national cousins,” and points to an increasing number of such businesses “thriving in areas of the UK where open access to backhaul can be secured.” (page 26).
The British press and industry analysts published straightforward accounts of the House of Lords report and its implications. Informa, for instance, blogged it was a wake-up for those claiming only slow and costly FTTP broadband rollouts should be considered:
“Politicians’ fears that the UK will somehow be ‘left behind’ by nations with networks capable of delivering speeds of 100Mbps or more, such as Japan and South Korea, have eclipsed the very real problem of those served poorly – or not at all – by the free market for broadband services. The major flaw in their thinking is that no one really knows exactly how superfast speeds will benefit nations and citizens. Despite the fact that well over a hundred million homes are now subscribed to next-generation services, no applications that truly require the speeds only these new networks can provide have emerged.”
Yet in Australia, Delimiter managed to miss all of these points in what is an admirably clearly written report, and file a story headlined “UK Lords back universal fibre NBN”.
In truth the House of Lords report did not say anything at all about Australia’s NBN. It did include the following very clear statement about FTTP: “Given the impossibility, with current constraints on resources, of rolling out universal point-to-point FTTP, we recommend that Government policy should, as an intermediate step, aim to bring national fibre-optical connectivity…within the reach of every community.”
Bizarrely, while the report urges a technology-agnostic approach to last mile networks and vigorously rejects public subsidies, Delimiter claims the Lords’ recommendations about UK broadband policy align almost perfectly with Labor’s NBN: “The House of Lords’ conclusions mimic the Australian Labor Party’s NBN project in a number of areas; revolving around principles of wide-spread fibre connected as close to housing and business premises as possible, open access to that infrastructure and a focus on the long-term potential of telecommunications rather than on short to medium-term specific speeds.”
No less curiously, despite Delimiter’s avid reporting of ex-BT CTO Peter Cochrane’s claims that fibre-to-the-node was “one of the biggest mistakes humanity has made”, today’s story fails to note the report gave those comments absolutely no credence.
While the House of Lords report is focused on the particular circumstances of the UK, a rational observer might draw the conclusion that it also poses awkward questions for those arguing for the current NBN. But not Delimiter:
“This dynamic has implications for the Coalition’s rival NBN policy. One of the key questions which the Coalition in Australia has not answered yet is what its long-term plan is with respect to national telecommunications infrastructure — is it factoring in to its plan an eventual shift to FTTH and away from its FTTN plans? And if so, why not simply deploy FTTH straight away, given that the Government’s current NBN plan is currently projected to make a return on that investment? These are clearly the sorts of issues the UK Parliament has been grappling with; and they need to be addressed in Australia as well.”
Strange days indeed. Perhaps Delimiter read a different report to everyone else.
hey everyone,
I’ll likely respond to this more fully tomorrow (Saturday), but just a quick note that I don’t disagree with much of what Malcolm has written here.
At first glance I feel the angles are arguing cross-purposes — our article was primarily discussing the technical aspects of the Lords’ report (and was based on the overall summary the Lords wrote), whereas Malcolm appears to have focused more on the differing methods of government intervention recommended, and has gone into detail deeper in the report.
Because of this I don’t think either article is necessarily wrong — it seems to me that we’re basically discussing different things. This, I suspect, reflects the complexity of the Lords’ report — and is one of the things which makes it so interesting.
I’d be interested in reader views (following an in-depth reading of the report) on what they feel the overall conclusions of the report are.
Cheers,
Renai
” our article was primarily discussing the technical aspects of the Lords’ report (and was based on the overall summary the Lords wrote), whereas Malcolm appears to have focused more on the differing methods of government intervention recommended”
I don’t think you’ll ever see anyone from the Liberal party going into any sort of discussion on technical aspects. There’s no way they can ever win that argument with their blind political ideology that FTTP is unnecessary in Australia.
I don’t think Turnbull has a “blind political ideology” at all — in fact, I think he does a lot of independent research before forming policy-related views.
At certain points his views are necessarily constrained by the need to not come up with the exact same policy as Labor — but I think where this happens that he does his best to present reasonable alternatives from a Liberal viewpoint.
Are there others within the Coalition who do have blind political ideologies? Certainly. But I don’t think Turnbull is one of them. That’s what makes him such an interesting politician — presented with enough evidence on a certain subject, he will eventually change his mind on that subject to suit the evidence. He’s one of the only politicians I have ever met who will do this.
I’m sure this statement will be read with a great deal of cynicism on Delimiter; but bear in mind how much Turnbull has evolved Coalition telecommunications policy since he took on the Shadow Ministership. Coalition policy in this area is basically now unrecognisable compared from where it was when he started. And he’s done a great deal of research in that time; international study trips; familiarised himself with the various pieces of academic and commercial literature out there etc.
That may be true about Turnbull, but the blind political ideology will win out every time while Tony Abbott is leading the Coalition. Nothing will change in that lot until Turnbull replaces Abbott as leader.
“I’m sure this statement will be read with a great deal of cynicism on Delimiter”
I think you’d be surprised. I think even the most die-hard Labor voters have a certain amount of respect for Turnbull, but I think it’s clear to all that he’s reached the brick wall; he can no longer bring the coalition policy closer to the Labor one because they’re getting too similar already, which leaves him in the unenviable position of trying to find evidence that FttN is better even in situations that he knows it’s not.
And that is why to some he is coming off as having blind faith.
And of course made himself a multi-millionaire by investing in early startup ISP.
Didn’t do him any good on improving his technical knowledge. Money isn’t everything.
He clearly knew enough to make a significant and successful personal investment.
Any fool with a stash of cash could have done the same thing. It doesn’t take technical knowledge to throw money at the Internet and get something out of it.
No they couldn’t. There were a lot of people (“fools” in your parlance) throwing money at the Internet in 1995-2000. Ever heard of the dotcom bubble?
http://en.wikipedia.org/wiki/Dot-com_bubble
He sold just at the right time. Almost held on to it too long trying to get the right price. When the bubble burst the buyer went broke rather than him.
So? That wasn’t luck. Successful investing involves both knowing when to buy and when to sell.
Sometimes it’s “knowing”, sometimes it’s “guessing”, and sometimes it’s just “pure luck”.
Seriously, because MT made it rich from ISP investment, does it make him knowledgable on all things tech…?
So do we accept because he’s rich he is knowledgable?
In that case Paris H for PM!
Now back to the real issues… *sigh*
I agree, politicians should restrict themselves to policy, only technicians should be discussing and choosing technology that meets those policy objectives.
Governments should set policy that is technology independent, so both that the policy can be implemented with any technology that suitably meets the policy, and the policy can outlast any particular technologies as they become obsolete, and faster and cheaper ones become available.
A *policy objective* that the government should have have been oriented to defining minimums that are available to be made available to all Australians, and sponsored by the government when there is not enough of a commercial return for private industry to fulfill that need. For example, the policy should have had requirements such as:
* all Australians should have access to the national broadcaster’s VoD services, such as iView and SBS-on-Demand.
* all Australians should have access to tele-medicine services of a suitable quality for consultation such that physical visits to medical professionals are only necessary when the patient’s physical presence is required.
See, notice there’s no specific technologies mentioned, or even specific performance parameters that the variety of networking technologies need to meet. This sort of policy would then allow the technicians to chose the best and most cost effective technology to suit the policy objectivs. As iView and SBS increase their available resolutions, and therefore the required bandwidths, and the technologies that facilitate those resolutions become cheaper over time (because they always do), the policy objectives will continue to be met as the technology changes and evolves.
Ultimately, however, what limits what technologies people use is limited by how much they’re willing to pay. Research shows that most Australians limit their spend on wired broadband to $50 per month –
“Understanding the Trans-Tasman Broadband Value Gap: ISP Costs in Australia and New Zealand”
http://www.marketclarity.com.au/documents/market-clarity-understanding-the-trans-tasman-bb-gap-30-may-2012.pdf
So regardless of what speeds the *technology* the NBN is using can deliver, if the cost of the resulting Internet service is greater than $50 per month, most people won’t buy it. People might be spending more on telecommunications services per month these days than what they used to in the past, they’re spending that on wireless Internet access (i.e. smartphones, tablets etc.)
http://www.abs.gov.au/ausstats/abs@.nsf/Lookup/8153.0Chapter3Dec%202011
Regardless of what the government think or want Australians to do, Australians are each individually in charge of how they spend their own after tax money. So unless the government gives all Australians their Internet services for free (paid for out of taxes that the government are in charge of), Australians themselves will choose how much NBN or not they will buy. Have a look at the wired verses wireless technologies shown in the ABS graph for a clear trend on which direction that is going in.
@Mark S
While I certainly agree in general government should not dictate technical specifications, there is call for it IF they want to maximise their investment. In this case, FTTH will last minimum 25-30 years. While FTTN would last 10-15 years max.
Also, your allusion to the fact Australians are spending their ‘extra’ telecoms money on wireless doesn’t correlate with the numbers. Yes, mobile wireless is growing at a high rare. Namely this is because many have multiple wireless devices. However, if what you say is true, that people will ‘inky spend up to $50 on the NBN and the rest is going to wireless’ would we not be expecting a corresponding DROP in fixed line services?
We don’t. Fixed line is nearly at saturation, hence its slow growth….but it is STILL growing and our broadband speed KEEPS rising, suggesting people are buying faster plans. Faster plans doesn’t always mean, but certainly indicates more money is being spent.
People are willing to spend more money on broadband IF it comes with a corresponding increase in convenience/ease or productivity for their situation. Saying $50 is the limit it ceiling is VERY presumptuous and perhaps even a little disingenuous.
Second- because Telstra will likely build the Coalition’s FTTN, it is HIGHLY likely to be MORE expensive to access than the NBN.
Wireless and the NBN are complimentary in the majority of cases. Not competitive. The mix of spending is entirely dependent on the individual.
“Also, your allusion to the fact Australians are spending their ‘extra’ telecoms money on wireless doesn’t correlate with the numbers. Yes, mobile wireless is growing at a high rare. Namely this is because many have multiple wireless devices. However, if what you say is true, that people will ‘inky spend up to $50 on the NBN and the rest is going to wireless’ would we not be expecting a corresponding DROP in fixed line services?”
Where are your numbers that my allusion doesn’t correlate with? Can I have a reference please?
Regarding a drop in fixed line services, study the ABS graph, in particular the blue part (representing wireless services), verses the remaining parts, which in aggregate are fixed line services. Notice the trend since 2007?
However, I wasn’t saying that most people were changing where they spend their $50, but rather they have an upper limit of $50 per month they’re spending on fixed line services (Market Clarity report, you should read it if you haven’t). *If* they’re choosing to spend additional money on telecommunications services per month, it isn’t on fixed line services.
@Mark S
Where are your numbers that my allusion doesn’t correlate with? Can I have a reference please?
In that very ABS report Mark. You’ve read one graph, which is a graph showing the proportion of connections. There ARE indeed more wireless connections than fixed-line. I have explained this and many other analysts have too- you can ONLY have, in general, 1 fixed line connection per premises. Sometimes businesses have several, but businesses only make up some 2 million of the 12 million premises in Australia. So, the total possible fixed-line connections is a direct result of the number of premises which grows at between 1.4% and 2.5% a year. As I said, at 63% of all premises with a fixed line connection, some 15% vacant and some 13% wireless only (actually it’s about 7% wireless ONLY, the others are naked DSL and no phone line) there is limited growth potential for fixed line. Meanwhile, many people have MULTIPLE wireless accounts- personal phone, tablet, work phone, hotspot etc.
THIS is why the graph shows a “decreasing” amount of fixed-line. Because it is decreasing as a proportion of total connections. Total wireless connections are above 14 millon now….hence MORE than 1 wireless connection per premises, which makes perfect sense. There could even be, potentially, more wireless connections than people, because people can have, again, more than one wireless connection.
However, if you look at the numbers directly below, you will see DSL growing, slowly(listed in millions): 4458 in Dec 2010, 4493 in Jun 2011, 4553 in Dec 2011.
So, as I said, your assumption people are ditching their fixed lines for wireless is incorrect. Yes, they are getting MORE wireless than fixed line connections- that’s just sense, as they can have multiple wireless accounts, but usually only one fixed.
Secondly: Research shows that most Australians limit their spend on wired broadband to $50 per month
This is ONE study don’t forget. It is a good study and a enlightening one, but only 1. Let’s not get hung up on numbers from a single source. However, what you are referring to is ARPU on broadband services being $50.95, as a median, in Australia.
This means, by proportion, half of Australians spend MORE than $50.95 and half spend less, overall. That’s the definition of median, as compared to average. This means it is NOT at ALL a ceiling of what Australians pay- it is an adjusted average. It takes into account any number of things, including what it costs to maintain the PSTN network, which is growing substantially every year, as well as how people use their connection. These ARPU’s are growing modestly every year for fixed broadband (NBNCo Corporate plan, Page 37- Reference is direct from Company Financial reports), indicating people are spending MORE on broadband, while they drop every year for fixed line phonecalls- not surprising seeing as most people have cap plans on mobile. And the rise of VOIP. The distribution of spending is changing TOWARDS broadband in fixed lines, not away from it.
This report is about fixed line ONLY- there is no correlation to be drawn from mobile compared to broadband ARPU in this report. However, Telstra’s own reports suggest the ARPU on mobile is only slightly higher at around $60, declining slightly, as fixed broadband did for Telstra, over the last year due to competitive pressures . (http://www.telstra.com.au/abouttelstra/download/document/2011-Annual-Report.pdf – Page 17) So this indicates that while people spend marginally more on wireless, growth of fixed and wireless ARPU very much follows the same path. This indicates there is little validity to the point that people are spending more on wireless (growing wireless ARPU) while spending less on fixed (falling fixed broadband ARPU).
Finally, that $50.95 ARPU is GOOD news for the NBN- their average required ARPU to meet their business case goals? $34. And it is predicted to now be above that, due to higher takeup of higher speed tiers than originally predicted. I wouldn’t be surprised if the new Corporate Plan due next Wednesday will show a restated ARPU of around $38. This STRENGTHENS the case for the NBN as it is STILL lower than ARPU on copper at $50. This ARPU is predicted to grow by around 33% over the 20 year operating life of the NBN, or about 1.5% per year- not far off the current growth.
Your assumptions about the NBN being WORSE for customers because of ARPU is incorrect by these numbers. I know the study you are referring to well- Phil Dobby covered it in his Twisted Wire” podcast several months ago. The challenge lies not in the NBN being more expensive for customers, but more expensive for Telco’s. Hence why all the negotiations on CVC and backhaul via POI’s etc.
Perhaps people only spend $50 on fixed because they see no value in spending more.
For example (hypothetically) why change from cheaper 8mbps ADSL to more expensive 24Mbps ADSL2, when, due to distance from the exchange you will not receive 3x the speed and in fact, you’ll be lucky if you even get 8 on the 24 plan?
I get less than 6 on my ADSL2 20 plan!
With the NBN the difference will be stark and obvious. Plus as 7T has said, the upper speed tiers are already popular!
According to the AFR article I read this morning, only 38% of people are taking up higher than ADSL speeds on the NBN. Popular would have to at least be measured as >50%, if not closer to 80%+.
Ahhh, there’s your problem Mark S :D
AFR is a Fairfax site…..known for being a bit roundabout with the NBN. Sometimes they can be accurate, like SMH…other times completely loopy.
Search back in Delimiter’s own archives:
http://delimiter.com.au/2012/06/28/nbn-85-of-australians-want-50mbps-or-higher/
I don’t know what sources the AFR has….but they certainly seem to be….how shall we say…..overly optimistic on the negative in this instance?
Ahhh, I see, you mean this:
http://www.afr.com/p/national/melbourne_cafe_patrons_lap_up_free_Bo543c9qrd9IZpuhcvVuQJ
Of those that had, 38 per cent had picked the highest speed package of up to 100 megabits per second.
That’s not fair. 100Mbps is WELL over ADSL. That 38% doesn’t take into account the 50/20 plan OR, as most people who get ADSL2 can’t get anywhere NEAR 24Mbps, the 25/5 plan.
Again, this is the sort of disingenuity the press pedals. You read that as ONLY 38% uptake for higher speeds. But there are 2 tiers BELOW that that are STILL higher than ADSL. As Delimiter’s article showed, 85% want HIGHER than ADSL can offer them today.
@Mark S
You seem to be LOOKING for reasons to criticise the NBN. Or is that just the way I’m reading your responses?
Much of this has been covered umpteen times here at Delimiter and elsewhere over the past 2-3 years. Perhaps some questions?
The success or not of a product or service is ultimately dictated by whether people spend their money on it. Whenever you buy a product or service, you are voting for its success. Whenever you consider but don’t buy a product, you are voting for it’s failure.
The Telsyte survey is asking people what they want (or at least, that’s what the Delimiter article says – I’d like to see the actual report). The AFR article is not showing what people want, it’s showing what they’re actually willing to spend their money on.
I’m sorry Mark_S but you’re searching for things to be critical.
http://delimiter.com.au/2012/05/29/higher-100mbps-uptake-will-spur-nbn-price-cuts/
That 38% that the AFR report mentioned WAS from real world uptake. The Telsyte report only confirmed it. That’s 2 entirely separate pieces of information- one actual data and one a well know analyst doing a survey- telling us Australians are WANTING AND buying higher speeds.
I’m starting to wonder whether you will actually believe anything other than what you want to believe according to what you’ve read.
I agree 7T.
Unfortunately what most NBN critics seems to do, instead of looking at the entire picture, document, article or whatever and discussing the entire topic, is to find small bits to suit/criticise (sometimes way out of context) and ignore the more pertinent parts… I think that’s what’s happening here.
For example if NBNCo were to say something like… “Due to the longer than expected Telstra negotiations, political hurdles, contractual issues and many other reasons beyond our control, we are currently somewhat behind our Corp Plan forecast numbers, in relation to people actually using an NBN service. However having said that, as we were unable to use Telstra ducts, we have instead been rolling out in other areas and are ahead in other aspects of the roll out. Being so we anticipate the roll out will still be completed on schedule and on budget.
NBN critics take – NBNCo even admitted they are way behind schedule in relation to their own white elephant’s forecasts.
Much like quoting figures based upon 38% 100mbps usage, inferring they alone are the only better than ADSL figures and ignoring other less than 100mbps (25 and 50) but still better than ADSL2 NBN plans in-between.
This is disingenuous and not rationally evidence based correspondence.
And lets face it people currently on a 20 or 24mbps ADSL plan who only get 6 or 8mbps, may even be happy to go to a 12Mbps NBN plan, just for now, up their speed and also save money…
But even though better for such a consumer, of course, the critics would never even consider, let alone mention the possibility of such a positive NBN scenario.
What we need is factual info from both pro/anti-NBN people, so as to all have a clear indication and form a rational opinion… but unfortunately it will never be, due to (as I have encountered) people’s blind political brainwashing which dictates spin and selective quoting to be more important than fact.
38% take up rate of 100 megabits (read: 100+ dollar per month plans) is a bad thing?
Hell, if only those 38% took up internet access then we we wouldn barely need anyone else on the network to pay it off.
I don’t normally resort to this kind of thing but your argument drove me to it: LOL. (it’s about what your argument is worth)
“there is call for it IF they want to maximise their investment”
Why couldn’t they just ask for “something that fills the needs for X, Y, Z, and gives the best value for money long term”? That would still result in FTTP, without directly specifying any individual technology.
I have responded to Malcolm’s blog directly.
Needless to say this is a case of the reading party’s ability to automatically redact certain sentences of a report in an effort to apply their thinking to the conclusion….
“Bizarrely, while the report urges a technology-agnostic approach to last mile networks and vigorously rejects public subsidies, Delimiter claims the Lords’ recommendations about UK broadband policy align almost perfectly with Labor’s NBN: “The House of Lords’ conclusions mimic the Australian Labor Party’s NBN project in a number of areas; revolving around principles of wide-spread fibre connected as close to housing and business premises as possible, open access to that infrastructure and a focus on the long-term potential of telecommunications rather than on short to medium-term specific speeds.””
Well….that’s because it does. Literally the only difference is the proposal of making the ‘last mile’ open for all, including other service providers.
You’re right about Malcolm not being wrong. There isn’t much in this article that is blatantly misleading (well, it actually is a bit), but there are a lot more than just “three key takeaways from the study” and they are definitely not “an unwelcome truth for supporters of Labor’s NBN policy”.
My response to Malcolm:
“Malcolm, I’m serious mate, nobody is buying this facade. I understand you have to avoid adjusting the Coalitions Broadband Policy to mirror Labors NBN as much as possible lest you draw the ire of your overload Mr. Abbott and the agenda driven News Ltd, but the rest of us can see through what you’re doing.
we appreciate you’re in as precarious position and you believe political expediency is necessary, but please do not aim this rubbish towards the people who KNOW you’re not fair dinkem about what you say.
Let’s hope Labor dump Gillard and force the Coalitions hand to re-enstate you as O.L so you CAN be fair dinkem again.”
Sometimes bluntness is the order of the day.
hehe, overload, I love spelling mistakes that add value.
Sigh Honestly I don’t care what Malcolm is saying any more he has a policy and takes the bits that agree with him from an article and ignores the rest.
If you every try and engage him on topics which do not agree with his opinion sorry I Mean Liberal party Ideology He NEVER answers the question his relentless politicking is terrible his only goal is to lie enough that people think that the liberal policy will deliver them world class broadband when what it really delivers is a TRUE White Elephant and GIANT Subsidies to telco…. I mean TELSTRA to continue their PRIVATE MONOPOLY so we pay Telstra Billions with our taxes Then pay them Billions more for a Crappy FttN Network
Access to telstra wholesale’s is already MORE than the NBN and you want them to invest money which means HIGHER Prices for US
Higher than the NBN and there is NO RETURN ON OUR INVESTMENT by subsidising telstra
It is clear Liberal Party Policy is to waste BILLIONS of our Money to get an INFERIOR network at a HIGHER cost to end users.
+1
@AJ
While I share most of your thoughts exactly, just for clarity’s sake and not wanting to do a Malcolm, the NBN is actually more expensive in many cases to access than Telstra wholesale. The ULL price to access a customer’s copper only (ie have your own DSLAM) is $18, while the NBN starts at $24.
The cost to access a Telstra DSLAM line (LSS) is, I believe, $31. So in that case it IS cheaper to access the NBN.
A FttN network requires a single provider to work it is not possible to have multiple providers because the Nodes are to small and there is no need for many exchanges in that way FttN is more similar to the NBN than the current situation.
SO if there is only one provider Telstra Wholesale and that one provide right now costs $31 compared to $24 that does not even take into account how much they will put up the prices to access this new whiz bang network.
Absolutely AJ
We’ve no idea how much Telstra would charge if they built the FTTN. It is possible for other competitors to have nodes….but that would require splicing a customer’s line physically between nodes when they wanted a new provider….and you’d need several nodes in all cases….AND if you wanted anything over 50mbps more than 600m from the node, you’d have to have 2 copper pairs to use VDSL2.
Falls apart very quickly for them doesn’t it….
He has a policy?
No he has sign saying: “no”. (saves his voice you see – for when he needs to say “no” out-loud for those on the radio)
““We recommend that future broadband policy should not be built around precise speed targets end-users can expect to receive in the short-term, however attractive these may be for sloganeers.”
Isn’t this much more applicable as a problem with Malcolm’s approach to a broadband solution? He is constantly advocating what is needed NOW, but avoids (and removes from his twitter feed, yes I have seen numerous questions vanish) any question about future upgrades and requirements.
Malcolm’s plan is “built around precise speed targets end-users can expect to receive in the short-term”
with no answers forthcoming on future requirements.
Isn’t this the sort of thinking that they are critical of? Our goal is X Mb, we will deliver, with no thought for the future.
Yes NBNAccuracy
But don’t let facts get in the way of his argument!….
Here are some of the unpalatable things, for Mr Turnbull, that the House of Lords committee said in their report.
At para 112. “As an overriding principle, we recommend that Government strategy
and investment in broadband infrastructure should always be based
on a minimum ten year horizon and possibly beyond.”
“At Para 98 Neilsen’s law,(67) like Moore’s law,(68) extrapolates from past experience to predict the future. It has proved a remarkably accurate predictor of bandwidth capacity and demand. On this basis, we should expect that those who are satisfied with 2Mb/s today will demand ~8Mb/s in 2015 and ~64Mb/s by 2020, and so on. Our infrastructure must be designed to cope with this advancing demand.”
They said in designing the network speed shouldn’t be the major factor but they didn’t discount it either. In fact they said:
“Para 97 First broadband infrastructure is an asset of strategic, national value. It does
not itself bring about, but it does enable, meaningful social and economic
innovation and change; if we want to be ambitious for ourselves, we have to
be ambitious for it, and under any circumstances it should not hold us back.
In this respect, we agree with the FTTH Council Europe: “While the future
needs of society cannot really be fully anticipated, a network which has
theoretically almost infinite capacity is preferable to networks which are
already constrained.”
So we have the situation where we are being told that in 8 years people will demand about 64Mbps which is about the capacity of the fibre to the node system being talked about by Mr Turnbull that hasn’t even been started. There is no way that he is looking ten years ahead or even beyond. Mr Turnbull is totally ignoring also the encouragement from the committee to be ambitious and not hold back.
It is also notable that even the House of Lords acknowledges that broadband infrastructure is an asset and that it is of strategic importance like roads, rail and energy networks (Para 50) It surely is time for the Coalition to upgrade its perception of the importance of the Australian broadband network and to stop treating it as a political football.
I am sorry but Mr Turnbull’s efforts to use this report produced by the British for the British to bolster his proposal of a FTTN network are just not acceptable.
I’m not really sure that comparing the *economics* of network infrastructure in the UK with Australia really works, given the stark differences in population density and land area.
In the USA, where (outside of the major centres) there are similarities to Australia, the telcos are busy taking the legal and lobbying axe to “community networks” where they have been established.
My own local council is busy replacing storm water infrastructure: it would be great to stick a bundle of fibres in every trench but having read the telecomunications act and associate legislation a few times over the years, I can’t say I’d advocate trying to meet all the obligations.
Is the coalition suggesting that they intend to deregulate in this area?
With respect Mr Turnbull:
As a Network Engineer, I find your statement here disambiguous.
“The Lords urged broadband policy to work to a horizon of at least ten years and include an upgrade path towards the eventual goal of FTTP. But lack of existing uses for the speeds offered by such a network pointed to a need to “set out an even bolder vision for broadband policy than is currently the case.” Again, the contrast with Australia is clear – our debate has focused intensely on the high speeds available over FTTP and their purported (but seldom demonstrated) benefits, and barely at all on the decade or longer many users must wait for adequate broadband.”
While on one hand you’ve agreed with them that we need an upgrade path to FTTP, you’re yet to clarify what your FTTP migration will be. Not only this, you’ve done nothing to restate the benefits of using FTTN over FTTP outside of your claims that it will be less expensive in the short-term. While I agree that yes it would be cheaper, when it comes to a quotation for a customer – any business is going to look at both the long and short-term benefits. What will this path cost me? Will I need to upgrade? What will that cost me then? and What do I require to achieve my goals ? I dont feel confident you’ve correctly addressed this, beyond stating that we need it. We do need ‘A’ path to this, what you’ve provided isnt.
Considering the NBN would have provided a Competitive Wholesale ONLY National integrated ubiquitous scaleable business capable communications Platform for the Nations future at no eventual cost to the taxpayer and would have removed the need for taxpyer subsidies for the Rural sector in the future.
The only alternative solution from the Coalition would have to be on the basis of ACCC controlled open wholesale with choice of Cable TV or iptv and Video content providers, At NO COST WHATSOEVER to the taxpayer over the long term. NO TAXPAYER SUBSIDIES OR GIFTS. That can be achieved by licensing fees or bonuses funded by the licence fee pool. Cherry areas, high licensing fee, Rural, bonus payments. It can be worked out. The Wholesale costs to be no higher than the NBN wholesale cost overseen by the ACCC. That will release taxpayer Dollars
We will have a second rate degenerating over the years to a relatively primitive National Communications platform that will only ever be upgraded in a limited piecemeal fashion.
Oh well deja vu , the historical performance of the Coalition holds to form
“Yet in Australia, Labor denies public investment to upgrade broadband requires non-commercial economic or social ‘spillover’ benefits to add up, instead claiming the NBN is commercially viable (and its costs can therefore be kept off the Budget).”
Say what? Labor is constantly using non-tangible “social benefits” to explain the/a purpose of the NBN. The only reason they justify it as “commercially viable” is to shut the Liberals up, and the others who claim it is a waste of money.
Besides, if it can be shown to be “commercially viable” using standard accounting practices, is it even allowed to be put on the budget? It is no longer classed as an expense I presume, until such time as there is sufficient evidence to indicate otherwise. To lie about such things would have the Government and NBNco run afoul of ASIC.
As far as I understand it NBNCo can make a loss and still be off the books. (only when you decide to write-off the loss does the loss end up on the budget. Never the cost to build it, only the amount lost.
But I don’t really know any of this accounting stuff, this is from hoovering information (possibly badly!)
“according to NBN Co, monthly revenue per user will double between 2012 and 2021, entrenching rather than reducing the digital divide.”
LOL.
As opposed to a patchwork of networks some with fibre, some with ADSL2+ and some with FTTN.
Clearly the only plan the NBN Co should offer is 25Mbps otherwise heaven forbid some Australians might want to purchase premium 100Mbps+ services with lots of data and double the monthly revenue.
Oh an exactly how much cheaper for consumers is that FTTN plan going to be Malcom?
The only divide I’m seeing is the massive gulf between an actual rollout that is happening NOW, and some vague policy plan that hasn’t got over the first hurdle of planning.
I just realised – the whole Opposition “policy” is a smokescreen and the Shadow Minister is the stalking horse, that is why the “policy” is confusing, contradictory, and irrelevant. They *want* the NBN to be a raging success, so they can steal it from the people who paid for it (you and me), sell it off to commercial interests, and use the proceeds for electoral bribes and corporate welfare. Just as they did with Telstra. Instead of going back to the future, we’re “moving forward” to the past.
Malcolm Turnbull is the one politician I feel can be trusted, among the current bunch. Unfortunately he’s stuck having to run Tony Abbott’s line.
Malcolm, please quit the Libs and lead Labor to the next election?
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