news An influential advisor to Malcolm Turnbull has published a spirited defence of the Coalition’s controversial Multi-Technology Mix approach to the NBN, but without including key facts which show a stark difference between the MTM model and similar policies in comparable countries.
Robert Kenny is co-founder of Communications Chambers, a UK-based telecommunications analysis firm. The analyst has emerged as a critic of the Fibre to the Premises model which Labor initially set up the NBN to deploy.
Instead, Kenny has regularly supported the case for deploying other technologies, such as the HFC cable and Fibre to the Node mix which the Turnbull and Abbott administrations have forced the NBN company to adopt.
Kenny was viewed as a key third-party advisor to Turnbull personally when the Member for Wentworth was Shadow Communications Minister in the three years leading up to the 2013 Federal Election.
In a policy analysis published in 2013 (PDF), for example, Kenny argued strongly against Labor’s FTTP model for the NBN, and listed himself as “an advisor to Malcolm Turnbull”. When the Coalition took power in September 2013, Turnbull appointed Kenny to provide key analysis for the Vertigan review of the NBN.
Late last week, Kenny published an article in The Australian newspaper, again strongly supporting the Coalition’s MTM model. In the article (we recommend you click here for the full article), Kenny argued that Australia was not alone in pursuing a complex mix of technologies to upgrade national broadband infrastructure.
The analyst paid particular attention to the HFC cable and FTTN technologies at the heart of the MTM model, noting that both of these technologies were being deployed and upgraded around the globe, and that some countries, such as South Korea, actually had a mix of infrastructure being used, not dissimilar to the MTM vision.
As Shadow- and then Communications Minister, Turnbull made a number of the same points in arguing that the NBN should change its model.
However, as Turnbull has done in similar situations, Kenny also left key facts out of his NBN commentary.
The analyst is correct in his assertion that the technologies at the heart of the MTM model are being deployed globally and that some countries have a complex mix of technologies in use. However, Kenny failed to mention that no other country is pursuing a similar commercial model to Australia for deploying those technologies at a government level.
The pattern for NBN-style policy globally is two-fold.
In countries where the incumbent telco is still owned by the Government of that country, the country has tended to take a long-term view and force that telco to deploy the best possible FTTP infrastructure, with the view that this style of infrastructure will serve that country’s needs over the long term.
This is the model being pursued in both New Zealand and Singapore, where the FTTP option has emerged as dominant in terms of government policy. It may be viewed broadly as a ‘command and control’, heavy-handed policy approach to the broadband issue.
In countries where the government has already largely privatised the incumbent telco, those countries have tended to instead place regulatory controls on that telco, as well as incentivising it to upgrade broadband infrastructure, often using Fibre to the Node infrastructure.
This is the case throughout Europe, where countries such as the UK, France, Germany and others are deploying FTTN infrastructure, often alongside existing HFC cable networks.
This approach may be regarded broadly as a ‘light touch’, regulatory policy approach to the NBN issue.
However, Australia currently appears to be the only country globally where the Government of the day is pursuing a model of acquiring legacy telecommunications networks — copper and HFC cable — which were already owned by that country’s major telcos — and upgrading them at the cost of many billions of dollars, instead of deploying new FTTP infrastructure to meet the country’s long-term needs.
In addition, Australia currently appears to be the only country where the Government of the day is directly deploying a diverse combination of technologies that will result in citizens, sometimes in the same street, receiving fundamentally different broadband technologies.
That option has been viewed unfavourably in a number of countries, because it undercuts the concept of equality in public service delivery.
None of these issues were addressed by Kenny in his article.
Delimiter invited Turnbull to comment on this issue directly during the Coalition’s NBN policy launch in April 2013, asking the then-Shadow Communications Minister: “The Coalition has made a great deal of the fact that the Australian Government is the only government globally to be rolling out fibre to the home but won’t a Coalition government be the only government rolling out fibre to the node globally?”
In response, Turnbull confirmed a Coalition Government would be the only government to roll out FTTN globally — an issue not addressed in Kenny’s article. “The answer is you are right,” he said at the time.
The Member for Wentworth added that the Australian Government shouldn’t be building broadband infrastructure itself, and it wouldn’t have done so, if it had had the choice. However, Turnbull said, the Coalition had been forced into the NBN model by Labor’s policy choices on the issue.
I have highlighted this article published in The Australian by Robert Kenny last week because it is a perfect example of the kind of flawed thinking, and misleading argument that those supporting the MTM model for the NBN use.
Kenny has, in effect, cherry-picked his facts to provide justification for the Coalition’s MTM model.
Sure, the analyst is right that FTTN and HFC cable infrastructure is being deployed in many locations globally. That much is obvious to anyone, and it’s impossible to argue against that fact. And of course these technologies can provide faster speeds than the previous crop of broadband options.
However, what Kenny won’t tell his audience is that these technologies are not being deployed by governments globally. FTTN and HFC cable are primarily technologies being deployed by telcos such as BT or AT&T which are already well-established in the markets which they operate in, because they are former incumbent telcos in those markets. As such, the use of these technology represents a logical minor investment for these private sector entities in infrastructure which they already own.
Nobody wants FTTN or HFC cable when they could have FTTP. These are clearly inferior technologies. But incumbent telcos deploy these technologies to keep existing customers happy with gradual capacity upgrades on networks they are already connected to.
Governments, on the other hand, aren’t forced into the same nasty and limited incremental upgrade cycle. They can afford the capital investment to deploy FTTP in their own right, and they historically do prefer it, because of the long-term, country-wide benefits that these kind of infrastructure can bring. Governments in countries such as New Zealand and Singapore have been saying this for years. They can afford to take the long view on infrastructure.
What Turnbull is doing with the NBN right now — and what Kenny won’t admit, because he helped put this botched policy together — is trying to fit a square peg in a round hole.
It is, in essence trying to upgrade legacy networks owned by Telstra and Optus for them and short-changing Australia in the process, instead of following Labor’s approach and using the Government’s own capital resources to give Australia the best broadband available in the long-term and making a profit off that infrastructure several decades down the track.
But you won’t hear many members of the MTM cheersquad admit this fact. Because to do so would be to admit that they personally have been complicit in tearing down a government policy that could have resulted in a network that would serve Australia’s needs for the next century.