NBN management credibility “shattered”: Turnbull


Broken glass

news The credibility of NBN Co’s management has been “shattered” by revelations that a third of the premises which its network rollout has passed with fibre can’t actually connect to the network yet, Shadow Communications Minister Malcolm Turnbull said this afternoon.

The National Broadband Network Company this afternoon confirmed it had met its revised targets for the rollout of its fibre network to the end of June, revealing that at the end of last month it had connected a total of 207,500 premises; a figure in the middle of its target range of between 190,000 and 220,000.

However, the company’s media release announcing the rollout figures (PDF) came with what appeared to be an indication that the company had changed the way it accounts for premises passed by its fibre infrastructure.

In its most recent corporate plan (PDF, page 36), the company defines its key ‘premises passed’ target as follows: “Premises are passed / covered when the shared network and service elements are installed, accepted, commissioned and ready for service which then enables an End-User to order and purchase a broadband service from their choice of retail service provider.”

However, in its media release today, NBN Co included the following more limited definition of the figure: “NBN Co uses the accepted industry definition of “Premises Passed”, that is homes and businesses passed by an active telecommunications network. This standard measure includes those complex premises that will receive services over the NBN outside of standard order lead times.”

Subsequently the Financial Review reported that of the 163,500 ‘brownfields’ premises which have been passed with fibre by NBN Co so far, more than 55,000 — or about a third — were not able to actually connect to the NBN yet. “In one part of South Perth, just 8.2 per cent of the premises, or 87 of 1057 premises, that NBN Co claimed had been “passed” by the fibre optic network were able to sign up,” the newspaper reported.

“The credibility of the management of the NBN is now shattered, with revelations that a third of existing premises ‘passed’ by fibre can’t actually connect to the network,” said Turnbull in a statement this afternoon responding to the news. “In South Perth, more than nine in 10 premises ‘passed’ cannot connect to the network. The NBN must now undergo a rigorous audit so that the public knows exactly where the project is up to, and how much it will cost in time and dollars to complete the project under Labor.”
Turnbull said that NBN Co had created a new definition of the ‘premises passed’ figure.

“Service Class 0 applies when “a premises that is not NBN serviceable . . . but is in the footprint of the NBN Co fibre network” – in other words, no ‘premises connection device’ has been installed,” the Liberal MP said. “This is inconsistent with the definition of a premise ‘passed’ in the NBN Corporate Plan (p.36): ‘Premises are passed / covered when the shared network and service elements are installed, accepted, commissioned and ready for service which then enables an End-User to order and purchase a broadband service from their choice of retail service provider.'”
“Between June 22 and June 30, the number of premises ‘passed’ by the NBN increased from 142,000 to 163,500.  However, it is clear that the vast majority of these new ‘premises’ cannot receive a service. The NBN Co’s abuse of the English language should not hide the real progress of this project.”

Turnbull added that global industry figures recently released showed that in the first quarter of 2013, there were 12 new fibre-to-the-node and fibre-to-the-basement connections installed for each new fibre-to-the-premise connection. The Coalition’s rival NBN policy would largely see fibre to the node technology used in the NBN rollout, instead of the technically superior fibre to the premises option preferred by Labor.

Turnbull also pointed out that NBN Co had also failed to meet its most recent target for the fixed wireless portion of the NBN rollout. It was rapidly adding users to its satellite network, but it may soon run out of capacity through that infrastructure.

“At the rate of new connections on the interim satellite service, the NBN is on track to meet the cap on users on the interim satellite service in late 2013 or early 2014,” said Turnbull. “Labor must now investigate increasing the interim satellite service cap as a matter of priority.”

Opinion/analysis to follow early next week.


  1. Thanks for keeping us updated Renai.
    Hey what’s this all about then? “Opinion/analysis to follow early next week.”
    If you are taking some time off, enjoy :)

      • Definitely looking forward to your analysis of NBN co’s new method of counting ‘premises passed’. It seems a bit stupid they’d adopt a new method, if only a tiny fraction of those people are able to connect to the NBN in a reasonable time period.

        What I’d like to know is – “what is the expected or average wait time, for someone who has their house counted as ‘premises passed’, and that customer being able to progress to the next stage of having the service physically connected?”. If the answer is an indefinite/unknown period of time, then the new method of counting premises passed does indeed seem misleading & for scoring political points only. I really hope that’s not the case.

        • @Simon

          It is almost exclusively MDUs. That is, apartments. Not houses. And the timeframe is mostly dependent on the strata boards of the various MDUs contacting, organising and allowing NBNCo. to connect their building to the network. NBNCo. can connect a detached dwelling with no permission. They cannot in MDUs. That is not NBNCo’s fault.

          These premises were always included in the count of ‘passed. Simply no one has actually bothered realising

  2. With respect, Renai, the currently used the current definition is what was also in the most recent corporate plan. Page 94 – Premises Passed.

    It is apparent the definition provided against the table on page 36, is different to the definition provided as per page 94.

    It would be disingenuous to suggest it’s “a new definition” by Turnbull, when the aforementioned document provides it previously.

    I’m not a fan of how they (NBNco) have split hairs; it’s just opened the door to yet more political spin, and is a bit of an own goal.

    • There’s a little irony at work here.

      Not too long ago, Malcolm Turnbull was all for promoting the valuable infrastructure of the existing HFC networks – which “cover” around 28% of the population.

      The interesting thing is that Turnbull was implying that when Telstra or Optus had “passed” the number of premises that it had, he was also agreeing with their definition – whether or not any service was or even COULD be connected.

      While I have a (defunct) Foxtel connection to my house, a friend who very much wants a Telstra cable internet service is unable to get one – even though the cable passes his home, and at least one neighbour already has Foxtel! Why? Because Telstra isn’t interested in hooking up new customers to cable.

      Yet he is one of those 28% – “passed” by cable, yet unable to connect.

      Mr Turnbull was happy to consider that 28% serviced, but not happy to apply a similar standard to NBN Co.

      The one difference? NBN Co WILL definitely connect you. The reality that you simply can’t hook up everyone at once shouldn’t overcast the fact that being passed by active fibre means you CAN get a connection. And if you’re in an MDU, it might take a little longer than if you live in a detached house.

      • Well, you can’t really comment on Liberal infrastructure projects I guess. How many decades ago did they build anything? Did they ever build anything?

      • That’s pretty inflammatory. Both Labor and the Coalition (and National before them) have histories of both success and failure in project outcomes.

        With respect, apart from appearing to be a dick, was there a point to your post, in relation to the topic?

        • I think he just wanted to make it clear to everyone, in case we weren’t already fully aware, that he is a “Liberal voter”. Not someone that usually votes Liberal, mind you, but a voter that self-identifies as a Liberal. The difference is largely but not wholly in the approach one takes to pronouncements by politicians – rather than be convinced by politicians’ arguments, he accepts those arguments as facts and fully involves himself in parroting those pronouncements to others. So, essentially, a “Liberal voter” is an unpaid footsoldier of the Liberal party in the Liberals’ bid for power. A “Liberal voter” does not vote Liberal because he wants the best outcomes for Australia, he wants the enemies of the Liberals to fail so that he can feel justified in voting Liberal.

      • As opposed to a Liberal Party-do-nothing-and-wait-for-Labor-to-do-something-and-then-whinge-about-the-cost-of-doing-things-backed-by-murdoch-globalist-bias type of project perhaps???

  3. I would like to know how many of those premises in South Perth passed are MDU’s, as there are alot of them there. Would explain it somewhat, as they still haven’t decided on what they’re doing with MDUs yet.

  4. Credibility shattered because exactly what they said would happen happened! Welcome to the Turnbull Zone.

  5. To really be on target they need to be doing a million a year. ~10M premises. 10 years. Simple.

    The “target” people are arguing over is laughably low. It’s more than four years since the NBN announcement.

    • “To really be on target they need to be doing a million a year. ~10M premises. 10 years. Simple.”
      Implying every premises takes the same amount of time to connect?

      “It’s more than four years since the NBN announcement.”
      Implying they started building it straight away?

      • No, not implying they should have started building straight away.

        However, Four years ago the work was going to be done in eight years. Half THAT time has elapsed already.

        Australia has been building houses faster than NBNCo has been connecting them. There are more premises to be connected now than when NBNCo started.

        • “However, Four years ago the work was going to be done in eight years.”
          No it wasn’t. They didn’t have a plan 4 years ago, they had little more than an idea. They didn’t even have an NBN Co when they magicked up that 8 year figure.

          “Australia has been building houses faster than NBNCo has been connecting them. There are more premises to be connected now than when NBNCo started.”
          Really don’t see how that’s relevant. You do realise they rollout by area right? So if there are more houses built in an area when they come to rollout to that area, they just connect those houses. It’s not rocket science.

          • The aim is to deliver a service to every house. While the rate of new house construction is faster than the rate of fibre delivery then there can be no sensible completion date for the project.

          • You fail to account for the rapid increase in progress and establishment time. You can’t just take number of premises decided by days since announcement date. If you did, those home builders are mighty incompetent, they take often months to build each room!

          • “The aim is to deliver a service to every house. While the rate of new house construction is faster than the rate of fibre delivery then there can be no sensible completion date for the project.”

            Your figures are a bit out of date.
            Building approvals are about 13k/month per ABS figures, giving about 40k premises for June qtr.
            NBN rollout figures show about 121k increase in premises passed over the June qtr.
            One of these figures is larger than the other, and not the way you seem to think they are.

            You might be right about active connections, which increased by only 21k over the qtr. But that would give a 50% broadband market share, about the current broadband market share per the ABS. But give the install tech’s some time to work and that will come up.

        • I suggest that your mathematical understanding of the situation may be flawed. If the rate of construction were constant and began from day one, then it is true that with half the time passed, half the job should be done. That is not the reality, however.

          It is more reflective of reality that the rate of construction increases as time goes on, with the gains in the construction rate great at first but steadily decreasing, so a shape that may approach something like y = log(x+1).

          The number of premises passed is the integral (area beneath the curve) of that rate of construction, so something like y = (x+1)log(x+1)-x.

          It is clear, then, that the great majority of completed construction occurs in the latter portion of the rollout timeframe. We aren’t there yet, but we’re getting there.

        • “Australia has been building houses faster than NBNCo has been connecting them”
          Wow, anyone with a business brain(like the pretenders who vote liberal) should be examining the contrasting investment dollars before making such an out-of-the-known-universe statement but liberal voters being liberal voters no one expects anything else… just so lol!! (Let me just clean the coffee off my screen, like whoah jebus!!!)

    • Pragmatic, may I introduce to you, the concept of logarithmic scale?

      No project of this type is linear in action, because there is a long lead-time in R&D, establishment and initial deployment; once kinks are ironed out, the speed escalates.

      This leads to a slow start, followed by accelerated progress. As we have seen. As we will continue to see.

  6. South Perth is pretty much medium rise buildings in most of the suburb ,so its not a suprise for there to have a slanted figure in that suburb. A suburb that for years had an exhcange that couldnt add any more phone lines and also some serious power transmission issues , at least whilst i lived in that area (we had a generator every 2nd street for over a year).

    NBN have a advantage to say they are passed when they havent actually connected them , but they also cant sit there waiting for MDU’s to sort out how they are willing to connect up and must move along.

    And the quicker they move to the bassendean FSM i’ll be connected so keep on skipping the MDUs :)

  7. Precisely what is the issue with connection? Isthere a ttechnical problem, or is it a legislative limitation whereby NBN Co cannot connect a MDU without Strata approval? If the latter, I would say it’s not only not NBN Co’s fault, but beyond their ability to control or even change. I would go so far as to call their definition of premises passed entirely reasonable in the circumstances – if they have passed a premises and have the technical capability to connect it but are unable to without Strata approval or because the owner declines, then NBN Co have met their obligations and should be able to include those premises as ‘passed’.

    Please point out if there is some technical or infrastructure limitation here and my assumptions are incorrect :-)

  8. The blinkered view that NBNCo can do no wrong is the greatest threat to the NBN.

    If you want the NBN you need to get NBNCo on track, or you won’t get a network.

    If you work at NBNCo you need to get NBNCo on track, or you won’t have a job.

    Spin can only get you so far.

    • They can and have done wrong. The problem is Turnbull and the media spend so much time criticising them using BS that there’s no room left for the real stuff.

      • What needs to be done to make this happen at the speed necessary?

        Legislative changes to overcome planning hurdles? Business changes to better motivate the workforce? Delivery changes such as increased use of arial cable? Technical changes to deliver a lesser service such as FTTC(or B) in places where that’s the quick way ahead? A breakup of NBNCo into utility-operated regional companies (the guys with all the cherrypickers and trained staff) who take a for-profit stake in the network they build while building to NBNCo standards? Something else?

        This isn’t Labor vs Libs. This is our nation seeing if we can get our act together.

        Rollout rate is king. Everything else is pontification. Perfect is the enemy of good. Perfect is the enemy of done.

        • “This isn’t Labor vs Libs. This is our nation seeing if we can get our act together.

          Well it shouldn’t be… unfortunately, as I said once again just yesterday…

          Personally, I have not encountered one person who’s opposition to the NBN can’t be traced back to either their political bigotry or financial selfishness (people who believe the NBN will affect their finances or that they may receive a better deal personally via the NBN’s alternative)

        • “What needs to be done to make this happen at the speed necessary?”
          I don’t think there is a reasonable way to make it go much faster. The only ways to do it would be to spend irresponsibly, or to get Telstra more involved which would probably be and expensive nightmare.

          FttC is not an option.
          FttB might be, but that’s not even sure to be faster and might cause problems down the line.

          The only realistic criticism that you can lay at the feet of NBN Co is they were too optimistic about how long it would take to get going, and maybe that it took longer than it should have to get going.

          • My criticism of NBNCo would be that they have chosen a plan that they cannot implement within the constraints of time and budget. At every turn they have made the “right” decisions, designing the perfect network.

            They need to make some concessions to the real world. Hanging GPON fibre from power poles would be a good first step. Where good ducts don’t exist underground is 10x the price and 10x slower than aerial cable.

          • If your really think their haven’t been concessions you really haven’t been paying attention.

            1) They have stopped at 93% for FTTH.
            2) They are using GPON over PtP fibre.
            3) They are, contrary to your assertions otherwise, running aerially where trenching isn’t practical, despite the higher risk profile and thus TCO of aerial.

            The perfect network would be all trenched all PtP fibre.

        • @Pragmatic

          I dont think you understand the minefield that is landlord legislation. Why do you think in over a decade Telstra/Optus haven’t pushed for changes?? They’re missing out on a 1/3 of possible connections for HFC. Why would they if it was easy to fix??

          If you change legislation surrounding MDUs you change EVERYTHING- electricity, water, gas, phone, security, everything. That is a MASSIVE kettle of fish that landlords would revolt over.

          NBNCo. is working with MDUs to the best of their ability. They’ve connected more MDUs to high speed broadband than any other single Telco ever has in Australia already. That’s saying something

          • All I am saying is that this is a project of unprecedented size and importance to Australia. All laws can be changed.

          • Can doesn’t mean should. Short and medium term inconvenience is the price we pay for long term sensible legislation. You don’t make sweeping law changes so you can win the next election, the payoff isn’t worth it, and any significant law change will always be resisted.

            People don’t like change. The fact their is opposition to the NBN even in informed circles proves this even further.

          • Keep in mind too that problematic MDU’s aren’t just because of BC laws, some buildings just were not designed to run multiple cables through them.

        • “Perfect is the enemy of good. Perfect is the enemy of done.”

          It’s worth noting that perfect is also the enemy of CRAP.

          The Labor NBN isn’t the perfect plan. It isn’t the crap plan. It’s the good one.

  9. You know what I’m tired of?
    In tired of people judging the progress of construction of a major infrastructure project by the percentage that’s fully complete, and completely ignoring the amount that’s, you know, under construction.
    It’s like judging the progress of a new airport runway by the number of planes that take off and land, or the progress on a bridge by the number of cars that cross it.

    You’re looking at the wrong numbers, folks.

    The NBN has 1.1 *million* premises currently under construction or complete. Now * that’s* progress…

    • you, sir, are shouting at the walls.

      Because a non-trivial number of people secretly want this project to fail, in a sort of misplaced “told you so!” mentality. We all really need this to succeed. And it’s hilarious that people seem to think there’s not enough pressure on NBNco.

      The entire established media in Australia, is egging them on to failure. It’s a very Australian thing to cut down perceived tall poppies.

      I expect NBNco to get the job done, and there’s more than enough pressure on them to see it happen. Dates may slip, things may go wrong but if they are primarily on target and getting the job done, on budget, then that’s really all you can hope for.

      Because whether the build is Fibre, or Copper, the same sorts of issues will occur.

      • That may be so, but letting the LNP define the metric to measure progress by is conceding the battleground before the first shots are fired. They want to be able to say the NBN has made almost no progress. Letting them talk only about premises complete is ignoring another million premises under construction, and doesn’t allow consideration of the next million that will start work on the next few years.

  10. However, it is clear that the vast majority of these new ‘premises’ cannot receive a service.

    Dear Malcolm

    33% is not a “vast majority”. Now give Joe his calculator back, and get back to work



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