Turnbull knows the MTM NBN won’t cut it, says Budde


news Malcolm Turnbull deliberately kept the Coalition’s Multi-Technology Mix from being mentioned in this week’s National Innovation and Science Agenda because the Prime Minister knows the model won’t meet Australia’s innovation needs, veteran telecommunications analyst Paul Budde said this week.

On Monday morning Prime Minister Malcolm Turnbull released a huge list of new policy initiatives relating to technology, innovation and entrepreneurship, as part of the Federal Government’s National Science and Innovation Agenda statement.

However, the document mentions the NBN just once, noting that the Government is investing in traditional infrastructure. This lack of consideration for the NBN as part of the package comes despite the fact that the NBN’s high-speed broadband infrastructure will underpin almost all of the other policies announced as part of the package.

Turnbull faced questions on the issue several times during the launch proceedings — firstly in the press conference to announce the innovation package, and then later that night from 7:30 host Leigh Sales. The thrust of both questions was whether the Coalition’s MTM vision for the NBN — which uses legacy technologies such as copper and HFC cables — could support the innovation package.

In a blog post published yesterday (we recommend you click here for the full post), veteran telecommunications analyst Paul Budde — who has been a long-term critic of the MTM NBN model — said Turnbull was aware the MTM model wouldn’t be good enough for Australia’s needs.

“He knows that the Multi-Technology Mix is not going to cut it when you want to boost innovation and create a ‘Silicon Valley’ Down-Under,” wrote Budde.

“If he believes in his version of the NBN he would have used it as a spearhead of his innovation policy, since in the end this policy should be all about implementing the innovations that are already available to us and the many others that will be developed in the future … they all depend on a first-class digital infrastructure to deliver innovations to businesses and the broader Australian society …”

“He is continually saying that Australian people are smart – and that is true – he is fully aware that the majority of the people in Australia don’t support his financial concerns re the NBN. Instead they would like to see a first-class broadband network rather than a second-class one. Do it once and do it right.”

Over the weekend, the Financial Review newspaper reported that the Turnbull Government was in talks to sell the bulk of the NBN to Telstra for as little as $20 billion.

The article was flatly rejected as “wrong” by Communications Minister Mitch Fifield, who said the Government had no plans to sell the NBN.

However, Budde said the fact that Turnbull didn’t mention the NBN as part of the innovation package was “another indication that he doesn’t seem to believe in it, and this makes the discussion on the possible sale of the NBN even more likely.”

“It look like the NBN policy is rapidly becoming a millstone around the neck of the government, and in that context, for political reasons alone, it makes sense for it to look for a way to get out of the hole it has dug itself into,” Budde wrote.

I agree with Paul Budde — Turnbull is clearly aware that the MTM NBN will not meet Australia’s future needs for long. The MTM was a political solution to a technological problem.

I agree with Shadow Communications Minister Jason Clare on this one. I believe we will see Turnbull pivot from Fibre to the Node to Fibre to the Distribution Point (with G.Fast) for the 2016 Federal Election. Then I think we will see increasing attempts to sell off portions of the NBN after that as we come closer to the network being finished by 2020.

Image credit: Office of Malcolm Turnbull


  1. “The MTM was a political solution to a technological problem.”

    The problems with political problems is the cost to rectify ones own mistakes is greater than the cost pushed onto others that you’ll pay for.

    • I’m not even sure there was a technological problem. The problem was purely political in that the Labor party came up with a popular technological solution to a problem. the Liberal party wanted to win the next election and came up with a shitty solution in 2010 and basically lost the votes of two conservative MP’s because of it. In 2013 they basically made the NBN a minor issue, people thought they were getting something as good but in reality got a mess that will need to be upgraded in the near future, but not too near to affect ones political future.

      I have no doubt if Turnbull was leader of the opposition instead of Abbott, the NBN would have stayed as FTTP and the politics would have been played out over things like the schedule and costs (as the were) and locations for the next part of the rollouts.

  2. Malcolm appears on 7.30 to talk about expenditure of $1 billion and nothing else if he can get away with it. He spends $56+ billion on another aspect of “innovation” and he prefers it not be mentioned.

    The comparison speaks for itself.

    • Indeed it does, it’s disgraceful what he and Abbott has done to the NBN!

      At the next change of gov we need a royal commission.

  3. Fttdp is the only way he can dig himself out of the grave he dug fit himself.

  4. Awaiting attack on Budde as “fibre zealot”… by copper throwback, rad cons….

    about………. now

    • Rizz it funny how the copper clan calls us fibre zealots but we are happy for the NBN to use FTTB and FTTdp due to the mess that Turnbull has created. We would have preferred the FTTP as all the evidence of it is cheaper faster and more affordable MTM has now and truely gone out the window.

      But those copper clans keep make up excuses for all the blowouts that have happen under Turnbull.

      • Indeed, I’ll take the solution thoughtfully created in Conrovia over the solution bludgeoned into existence in TurnBullshitistan any day of the week!

        • DerekO
          It’s turnbullstein as he is trying to bring the dead 5 min till midnight copper back to life lol.

      • JasonK,

        ” We would have preferred the FTTP as all the evidence of it is cheaper faster and more affordable MTM has now and truely gone out the window.”

        The evidence was never there in the first place.

        • Reality
          April 2013 $29B 2016 all by then
          Nov 2013 $41B 2020 4.5M premises by 2016
          Oct 2015 $56B 2020 2.5M premises by 2016

          • Detour really you said there was no evidence but 3 difference cost and time frames in 2 years is not evidence. Doesn’t help Reality being in denial. Or according to you the pre election policy and the SR doesn’t exist anymore.

          • Jason that’s simply the illogical ideological again seeing facts as mere detours or distractions, regarding their perpetual crusade.

  5. @Joel C – No. The problems with political problems is the electorate will wind up carrying the cost of rectifying them. That’s you and me, chum.

  6. Honest question, even if (big if) Morrow & Turnbull said they were going to do FTTdp
    would you vote for them next federal election?

    Just wondering :)

    • FK no, After near 3 years of blatant liberal lies and attacks on those who can least afford it, I’ll be voting any colour but Blue!!!

    • It would also be a vote for university deregulation, increases to the GST and a signal that it was absolutely ok to break every election promise and then act in the most ironic and hypocritical way by cutting off their first term prime minister in a show of ‘disunity’ which was considered a cardinal sin by them only a few years ago.

    • Well Turnbull said with a straight face before the last election that everyone in Australia will be connected to the NBN before the end of 2016. He well and truly would have known this to be an impossible feat, so no, I wouldn’t vote for him for that alone.

  7. Turnbull didn’t mention the well known and established Coalition NBN policy, a model everybody is fully aware of and what the MtM mix is since 2013 in his this month technology and innovation speech, which was all about NEW funding announcements and NEW policy direction.

    The amazing conclusion is therefore he doesn’t believe in it. – huh?

    umm ok

    • Which policy is reality the $29B one the $41B on or the now upto $56B.

      But the all the innovation requires a good underlying broadband network. Considering NBN is only required to deliver an up to 25Mbps once a day really shows how bad this $56B network really is.

      • So no innovation in the USA, United Kingdom, France, Germany, Austria and Taiwan, all users of MtM infrastructure.

        • Here’s some ‘innovation’ using HFC.

          “Speaking here on Tuesday, Salinger announced that Comcast Corp. (Nasdaq: CMCSA, CMCSK) is now testing DOCSIS 3.1 in the field. “The target for us is to be in the field establishing network readiness in 2015,” he said. “Our overall goal is to be able to deploy DOCSIS 3.1 and gigabit-per-second in a broad scale starting in 2016.”


          This is the USA’s largest internet provider, but what would they know.

          • But alain,

            We don’t need such speeds (you told us this for years and your Coalition and their reviews said so, “so it must be true” – *sigh*) but look at these speeds… ROFL, precious.

            And by 2016 how ironic… I wonder if that will be like Malcolm’s 2020 err, 2016 too and if they will have HFC better then Optus’ (glue factory HFC) to use their turbo charger on man… you know the blower which will bring HFC up to (like that – up to) nowhere even fucking near the capability of fibre…

            And then the all important cost of these upgrades… once again lessening the gap between, the cost of the vastly superior FttP and cheap and nasty FRAUDBAND with pointless add ons.


            Anyway, with that in mind, remember just a few days ago when you boasted the “Coalitions FttP” (yes the one you forgot was arranged by Quigley and the others) roll out was going along nicely.

            No you don’t remember?

            Well you did…

            But it’s not surprising you don’t remember, considering all of those endless hypocritical contradictions of yours. As such I don’t think you could remember what you said a few minutes ago let alone a few days ago…

            You’re welcome.

          • yes Reality they are building Gbps networks what are we building an up to 25mbps network why would any innovators would want to stay or come here?

          • Alain, I have no idea what your point is. Comcast own the HFC already, they are not deploying NEW HFC as the entire HFC industry knows that this is far more expensive than FTTP.
            On the other hand, Turnbull is deploying new HFC by purchasing the existing HFC. You are comparing apples and oranges and again making no sense.
            If you look at new deployments, they are all FTTP around the world…except of course in Australia.

          • Chas,

            You do realise that Telstra and Optus would have got the same $11b and $800m under Labor, where the HFC BB function was to be turned off and overbuilt with FTTP?

            Have a deep think about that in the context of your comment about the Coalition having to ‘purchase the HFC’.

          • Reality
            But now there is more additional cost to NBN the was the responsibility of Telstra cost of pits and ducts remediation any upgrades Telstra does be gore the change over NBN pays for. So now the cost is $11B & 800M +.

            Have a deep think about that.
            But then there pre election policy was going to let Optus and Telstra compete against NBN with there HFC not purchased it.

          • Derek O,

            ” let’s ignore what else Comcast are doing, building FTTP to 18 million premises!”

            So that’s ok then, the USA are using MtM, Australia is also rolling out FTTP but even better not to cherry picked areas for use of the infrastructure builders customers.

          • Jason K aka Rizz,

            ‘So now the cost is $11B & 800M +.’

            So how much extra is that in $$ and explain how FTTP is cheaper, I missed that all important calculation, oh that’s right in the NBN Co modelling scenario of the leaked PDF about the Optus HFC the most costly option to overbuild Otus HFC (assuming it ALL needs to be) was brownfields FTTP.

          • Alain,

            The price of $800 Million was for the customers and transition WITHOUT the massive costs of the network itself and the (now evident to all) huge cost of rebuilding and deploying that network.
            It’s why most companies often just lease things instead of buying them outright. Leasing would certainly make more sense than buying a whole network that was well past its used-by date and trying to spend the same amount again to fix it up so that you can have a few years reprieve and kick the can down the road.

            I don’t think you understand how this business thing actually works mate…
            The only reason to actually purchase the network would have been to resell it after you were done with it…obviously nobody else is stupid enough to buy a worn out HFC network, even an “upgraded” one.

          • Chas, he gets it but he’s ignoring it because it doesn’t fit in with his Conservative idiotology.

          • Chas,

            ‘The price of $800 Million was for the customers and transition WITHOUT the massive costs of the network itself and the (now evident to all) huge cost of rebuilding and deploying that network.’

            What huge cost??, I am not aware of it and why is a FTTP overbuild cheaper than the so called unknown ‘huge cost of rebuilding and deploying that network.’

            Who says the network has to be rebuilt, tell us how much overbuilding it with FTTP will be, and why is FTTP the cheapest option?

            “It’s why most companies often just lease things instead of buying them outright. Leasing would certainly make more sense than buying a whole network that was well past its used-by date”

            So you spend $11B and $800M and Telstra and Optus say to the Coalition NBN Co you can have the copper and HFC infrastructure included, and you say no thanks I will pay those amounts to you anyway and pay you more on top of that to lease them, just because you want to throw money away.

            ‘and trying to spend the same amount again to fix it up’

            Who said you need to spend that amount again to fix it up?

          • Let me spell it out (after all it is harder than the last one that stumped you, which was of course 1 + 1 = ?) so…

            $11B + $800m + no additional costs = $11.8B

            $11B + $800m + DOCSIS 3.1 (you raved about above) + replacement HFC + replacement copper + maintenance of HFC + maintenance of copper + extra power costs etc > $11.8B.

            So you tell us alain, which costs less in this regard…?

            You’re welcome.

          • @Reality

            FTTP overbuild cheaper than the so called unknown ‘huge cost of rebuilding and deploying that network.’

            It’d be cheaper for the same reasons it’s cheaper to use FTTP in Greenfields, the actual cost to build is the same, but the copper incurs much higher on going costs.

    • “a model everybody is fully aware of and what the MtM mix is since 2013”

      Aware of, oh you mean like…

      * the “PROMISED” fully costed and ready to go, $29.5B MTM network, err, not actually ready and much higher than $29.5B
      * the UPTO $15B blow out of the “cheaper”, vastly inferior product
      * the 4 year hold up, initially promised to all Aussies by 2016
      * the copper to be replaced by copper
      * Optus’ HFC being shot
      And the list goes on…

      NO we weren’t aware (but all just fine by you – WTF) of all the lies behind the empty election promises, but sadly seeing this completely fucked up FRAUDBAND disaster, we are now…

      And what about that essential and transparent CBA, YOU required to decide the best avenue for us to take, following 2013? You know the fully transparent CBA to be carried out by the independent PC?

      Oh we weren’t aware of their further “alterations to their pre-election position/promises” here either. You know, the independent PC being replaced by – an anti-FttP advocate (pun intended alain/advocate), Lib donator and pro bono buddy (but this time at $1.5m to the taxpayer)… for their “independent CBA… wink”.

      Keep beating alain.

      You’re welcome

    • If the government announced they were spending $1bn constructing a new industrial Park with premises for 100,000 workers, to be completed in 1yr, on the outskirts of Sydney, that had no public transport facilities to it or planned for it and the only access was a single lane road that was already fairly congested, and they explicitly said they were not going to upgrade access, saying it was already more than sufficient, what do you think the response would be? Outrage? Disbelief? Or everyone would think it was perfectly reasonable?

      The idea that you can have an innovation initiative that is designed to:
      A) promote and develop innovation, entrepreneurialism and highly skilled world class thinkers
      B) make the innovation sector and environment in Australia so attractive that world class innovative people and startups will stay here instead of heading overseas, and
      C) will be so attractive that it will attract world class innovative thinkers, entrepreneurs and companies to *move here* instead of other favourable innovation and startup hubs like Silicon Valley,

      without delivering world class infrastructure upon which people can build their innovative startups is patently ridiculous. You can avoid the facts all you like – conservatives are world class reality avoided. But back in the real world we’re concerned about this abject failure of logic.

      • Uninvited Guest,

        “without delivering world class infrastructure upon which people can build their innovative startups is patently ridiculous.”

        FTTP has been rolled out in Australia for many years, first by the Telstra Velocity program and others like Opticomm, then NBN FTTP from 2010 on.

        So how are all these the ‘innovative startups’ going that are exclusive to these areas?

    • No indeed. What he spent time on was letting us know how innovative the liberal government was by returning the money they cut from the CSIRO when they came into power.

      I’m guessing however that you won’t see the contradiction there either.

  8. I’d be interested in what Budde would suggest for multi-user dwellings to 2020, body corporates, given how for example TPG has got FTTB/ VDSL2 (at AUD/$70 for 50 to 100/ 20 Mbps), and pretty sure I read somewhere nbn/ NBN is looking to use VDSL2 en-route to G.Fast.
    “Quarter acre blocks” …? At the next election I expect lotsa FTTdp is so different from FTTx or HFC messaging.
    Greenfields get fibre (if shared, sounds like multiplexed copper, 10G/ NG/ PON2 on the way, P2P cost differential for something to last a generation apparently 10 precent), tick.
    Upgrading HFC bought from Telstra, tick. See AFR about selling portions of nbn/ NBN …
    Regional and beyond get wireless, tick. (Expanding mobile terrestrial wireless to cover more landmass, tick. I also note SingTel Optus has a 50 GB of 4G LTE-Advanced plan out for AUD/$70, probably okay if not gaming or Netflixing.)
    Applying lessons from privatising Telecom/ OTC (or other “natural monopolies”), or offloading Aussat, tick.
    Anytime governance/ policy gets too close to supply/ services (nbn/ NBN, school halls, pink batts) or by eg picking winners instead of enabling standards etc, demand foots the bill.

    • John
      I believe Paul would be fine with FTTB due to the short copper length it’s pretty much FTTdp due to how short and easy for the upgrade to g.fast.

      The problem with FTTN is we don’t have the population density for it to do the speeds and % of people to get those speeds Turnbull has claimed. The other problem is g.fast works over 200-300m max. The new copper NBN is buying is to put between the node and pillar and the average length is 350m so puts g.fast is out of the question. Unless they go FTTdp which requires more work and fibre closer to the premises after they deploy FTTN or they ditch FTTN and go FTTdp.

  9. “The MTM was a political solution to a technological problem.” – nicely put.

  10. Turnbull has been running from questions regarding the NBN since his election, a dozen appearances on Q&A not a single NBN question ever asked.

    • Go back the last two years – Turnbull is almost never asked about the NBN – in fact, when on Q&A Turnbull has almost never been asked questions about the Communications portfolio at all.

  11. The only real hope of saving face Malcolm now has, is to make the nbn actually approach what he promised (not using FTTN, but rather FTTdp), make back what was invested and then sell it.

    Though much like the original Telecom sale, I think selling it off would be a huge mistake, either they’d create another Telstra monster, or we’d get saddled with the “Baby Bell” issues the US has.

    It’s be a lot smarter to keep it as a GBE and treat it as just another public utility.

    • You’re assuming he feels like this is an issue he needs to save face over. Given the comprehensive lack of analysis of Turnbull’s performance over the past five years by the media, even by the Guardian who you think might actually bother to look, the NBN is a non-issue as far as public opinion and an election result are concerned. Turnbull will only care about saving face if the majority of the country turn against him as a result of it.

      • I look forward to the media analysis of the revitalised Labor NBN policy for 2016, assuming they get to see one.

        • Looking forward for another cost blowout what’s the count 2 in 2 years oh wait CP change acording to you so we can expect another $10B cost blowout next year.

        • More of the same/endless procession of… it was never ok for the last mob but absolutely fine, applauded and welcomed, from this mob… absolute mindless hypocrisy from alain…

          But of course, I am simply stating the obvious… we have learnt that’s what he shamelessly and desperately aways does.

          Mixed with laughable BS and ridiculous contradictions, of course.

          • Yes Rizz.
            We have reality here now claiming the CP16 is the pre election policy. Trying to rewrite history again lol

          • Or Hotcakes labor can’t take the coalition approach of saying they could do FTTP with in 3 years and done for $29B. Becuase according to Reality it’s ok CP’s change.

    • Im with you mate, i think it’s a stupid idea to sell it. Keep it, feed profits back to government seeing as they complain so much about lost revenue over the past few years..

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