The Australian Labor party have just announced the detail on a revised NBN policy they’ll take to the election. The plan differs significantly from their original, ambitious NBN plan to delivery FTTP NBN to 93% of Australians, largely as a result of how far the project has progressed under the current Government.
In the latest weekly report from NBN Co, we know as of Thursday 2 June 2016, there are now 2,587,411 premises that are capable of getting a service (including satellite) and just north of 1 million premises that are customers on the NBN. With the project deep into the rollout of the ‘cheaper and faster’ mixed-mode option, the prospect of ripping up the copper and laying a majority fibre network is now not viable. Not only would it be incredibly expensive in a time where the budget is tight, but we can never get back the years spent rolling out FTTN.
During a press conference this morning, opposition leader Bill Shorten attacked the Government for letting Australia drop from 30th to 60th in the world in regards to the list of countries ranked on internet speeds.
Shadow Minister for Communications, Jason Claire says AT&T in the US and providers in New Zealand are going back over the FTTN networks and upgrading them to FTTP. While it is certainly possible to rebuild the network, there was an opportunity for Australia to build this high-speed internet network once, we have now missed that opportunity.
The capital expenditure of Labor’s NBN will cost an additional $3.4 billion, but the operating expenditure costs are $1.2 billion less. Claire claims that once all the nodes are operational, the cost to run them annually is $60 Million to run. In the modelling they’ve done, they predict a 19% reduction in costs of rolling out FTTP, which he says is conservative, compared to gains made by Chorus in New Zealand, which has seen around 29% decrease in the last 12 months.
The Labor plan equates to 39% of homes and businesses being connected with FTTP, this compares to just 20% under the Coalition’s plan.
Labor’s NBN policy now has the completion date scheduled for June 30th, 2022, but as we know from history, dates on this project, from both sides are incredibly fluid and another change to Government will surely add to delays.
Those following the NBN will remember Turnbull’s pitch to deliver the NBN cheaper and faster was based heavily on the fact the capital works required to run and connect fibre to every street and every home, getting approval and actually digging up gardens, was costly. Labor believes they will be able to cost match the Government’s model and achieve ‘up to 2 Million’ more FTTP connected premises, by lower ongoing operating costs, thanks to those areas serviced by fibre, avoiding the cost of powering node cabinets installed in each street.
The price of the updated model is said to match the current Government cost to the tax payer which was $29.5 Billion plus private investment, for a total of $56-57 Billion.
Many users in city areas are currently on internet services delivered by HFC (Hybrid Fibre Coax) which in theory can deliver up to 100Mbps. These networks were built out by private providers, Optus and Telstra and the original plan was to upgrade these to the faster fibre connections, however Labor have now confirmed they won’t be upgrading these networks to fibre.
Whatever side of politics you land on, what you should be asking is why, after tax payers have funded this project to the tune of billions of dollars, are less than half of available premises, actually taking up a service on the NBN ? Everyone loves faster internet right? So why would anyone say no, when they get the knock on the door, offering the service? Customers in existing internet contracts have the option to upgrade pretty seamlessly to an NBN plan, without attracting a break contract fee, as long as they stay with the same provider, so it can’t be that.
Is it possible that given so much of the NBN publicity has been around the policy differences, that the message about the possibilities available on faster internet connections (both up and down), hasn’t reached everyday consumers?
One thing that is certain, is the claims that all homes would have a minimum of 25 Mbps by the end of this year (2016) will not be met by the Government.
In an example of exactly what’s wrong with politics, Prime Minister Malcolm Turnbull replied to the Labor announcement with this, a declaration the finances are wrong, white not detailing how the cost changes are wrong, instead simply labelling them as ‘shortenomics’.
Prime Minsiter, this is playing politics with an issue that is far too important and certainly isn’t treating votes as adults like we were promised. If Australia as a country and Australians as citizens are going to win on the global stage, from the fruits of the NBN investment, we need to find productive middle ground on NBN strategy and actually make meaningful impacts on availability, connectivity speeds and uptake rates, rather than off-the-cuff politics that immediately oppose.
— Sky News Australia (@SkyNewsAust) June 13, 2016
For more information, you can read the Labor NBN policy here.