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National Broadband Network (NBN)

July 30, 2010

Posted during the 2010 Australian Federal Election on the day (30 July) Julia Gillard announced the National Broadband Network (NBN) footprint during campaigning in Perth.


The NBN was always going to be a political battleground, after all the Government doesn’t go and launch a new statutory businesses every day. In what may be a tight election, the NBN makes a perfect smokescreen, rallying point and opportunity for A-grade FUD (fear, uncertainty and doubt).

Personally, I am not trying to influence your vote, or in the post-election aftermath, your political view. After all, the Labor Government while giving the NBN with one hand wants to exert a level of unexplained and poorly thought-through filtering with the other. For me, this makes the electoral choice on this topic difficult. So let’s drop the ‘filtering’ discussion for a moment and look ONLY at the NBN. Let’s try to get behind some of the rhetoric, bullshit and downright lies.


Not many of us seem to think that a better digital infrastructure is a bad thing. After all, Australia has dropped to 50th in Akamai’s recent review of global internet performance (speed). Faster and better is good for individuals, good for business, good for international trade, good for Government, good for health, good for education and good for the general prosperity of Australia. Today, digital infrastructure is almost as important as physical infrastructure, you can debate the relativity but not the fact that it is crucial and getting increasing crucial all the time.

So why, the minute digital infrastructure’s importance is endorsed, is the next comment one that leads to an outcome of ‘no action’? The reasons are almost all agenda driven! Lets take a few.

Duplication – It is suggested that the NBN shouldn’t proceed in its current form because it duplicates other infrastructure. If that were really true, no one would be complaining about slow (or no) internet and we wouldn’t be the 50th placed economy in the world. It is the same as saying don’t add another lane to a freeway because its duplicating infrastructure. By the way, there is very little rural and regional fibre in Australia. Anyone who uses the duplication argument is ignorant, stupid, malicious or politically driven (no punches pulled).

Superseded – It is also suggested that we could wait for better technology, perhaps wireless. Well many of the counter-duplication comments apply here as well. So why not wait? Hold off until we are 100th in the world, and can no longer extract enough of our countries wealth to pay for major infrastructure. We managed to keep getting more bandwidth out of Copper Wires. Well Fibre Optic Cable has astronomical potential throughput and almost no escaping radio emission (radiation). As the technology in the complex electronics at the ends (terminations) of the cable runs improves, these elements can be progressively updated in a modular way without having to change the cable. Waiting for future innovation is not a wise move for a whole country and again is a poor argument for inaction. In most countries such an idea would be laughed at.

Expense – It is suggested that $48 billion or so is too expensive. Well that $2,1oo or so per person is really not a big cost compared to its benefit. The Victorian Government spent over $1 billion on the Myki ticketing system (about $200 per Victorian) on a public transport ticketing system that still doesn’t work as promised. There are significantly larger government expenditures that deliver far less outcome. Finally how much is it worth to be in the Top 20 of the World’s connected economies, compared to our current 50th or lower. Do I need to have another go at people who are using this argument.

Incompetence – Another argument, one that I quite like from a more perverse viewpoint, is that the Government can’t be trusted. When this one is delivered it is usually by one part of Government talking about another part of Government (but certainly not about themselves). Stepping away from the fun of this argument and in some cases real evidence (Myki, Insulation, Stolen Generation – it is a very long and distinguished list of failures), the reality is that NBN is a statutory business. The Government owns it but doesn’t RUN it. I have met the CEO, CFO and a number of other NBN staff. They are some of the smartest people I have ever met and clearly world class. Thankfully they are also trying to do a job and create outcomes and are removed from the political arguments and agendas. You could have more confidence in their ability than operations in most other parts of the political debate. Expecting results is not stupid, simply saying the NBN can’t deliver is! There is real evidence from the Tasmanian roll-out on how it will work and the scope of the benefit that will be delivered.


There are plenty of other equally stupid arguments that I think you can apply much the same analysis or simply review the evidence. There are also real and serious issues, equality of access, cost of final provisioning and a host of others that are about the nature of implementation not the existence of the program. I hope you agree the NBN is a worthy project. Now the filter on the other hand, that’s a topic for another day.

Please comment, and please also take a good look at NBN Co.

9 Comments leave one →
  1. Mat Brennan permalink
    July 30, 2010 5:10 AM

    The biggest controversy you are still to write about.

    But it’s easy enough to make the logical argument “well if they own the pipes then they control the usage”.

    I’m skeptic as to how it will change the way ISP’s operate and what sort of advantages it will bring to the consumer price.

  2. July 30, 2010 11:02 AM


    The “if they control the pipes then they control the usage” argument only potentially holds true while the government actually owns the pipes. Many people seem to forget an interesting part of the NBN proposal. The government will only only own it for five years after completion. They will then sell it off to the market where it is most likely to be purchased by a consortium of ISP and infrastructure investment funds.

    Why would they do this? The main reason is that sovereign ratings agencies are OK with government owning significant infrastructure assets during and for a short period after the completion but they frown upon (and downgrade bond ratings of) countries that hold on to such major assets.

  3. Ashish permalink
    August 7, 2010 7:33 AM

    Hear hear, there is a long list of examples where the government has had to step in and spur innovation in telecom. The splitting up of ma bell in the U.S comes to mind, our network infrastructure is too important to be controlled by monopolies.

    NBN, executed well, will certainly jump start innovation in Australia. Looking forward to it.


  4. Zebra permalink
    August 14, 2010 7:52 AM

    Here is a blogpost on the cost of the NBN. Works out at $10 per person per month for Labor’s plan or $2pppm+add-ons for Coalition’s.


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