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Much cheaper NBN wins it by a whisker

By on September 9th, 2010 

Twisted Wire

Phil Dobbie

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The green light has been turned back on for the NBN, perhaps because the Independents were told the cost to the taxpayer was considerably less than $43 billion.

There are no certainties for a minority government, particularly this one. Can we really expect Tony Windsor and Rob Oakeshott to spend the next three years siding with Labor, particularly if it means supporting decisions unpopular with their electorate?

In the New South Wales seats of Lyne and New England the local press is rife with criticism for what is seen by many as backing the wrong horse. It's understandable. In New England the Labor Party attracted just 8 per cent of the vote. Could the Independents be forced to shift their allegiances and drive us back to the ballot box?

If that happens the whole NBN project could still be wound up, says Ovum research director David Kennedy. CEO of the Communications Alliance John Stanton is more optimistic, but sees a need for an education process to sell the benefits to the public and the politicians.

Fortunately for the NBN it appears to have more support than the mining tax, but the debate continues to rage about whether it's worth $43 billion. Associate editor of Business Spectator Robert Gottliebsen, however, says the need to argue that case is likely to disappear. He explains how the real cost to the taxpayer will be considerably less, which will remove the big question about whether it's worth the investment.

You'll also hear from David Ellery, editor of the Northern Daily Leader, and Janine Graham, editor of the Port Macquarie News, who reflect on public opinion in Tony Windsor and Rob Oakeshott's electorates.

Senator Scott Ludlam, the Greens spokesperson on telecommunications, is also on the program with his read on how the NBN will progress from here.

Running time: 27 minutes, 26 seconds

Talkback

I would appreciate it if you could explain, that because the NBN will generate a return, the money can be raised through debt and therefore cannot be spent elsewhere - e.g. roads.

NPSF3000NPSF3000 September 9th, 2010
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The anti NBN crowd often argue that Australia will effectively be puring 43 billion bucks into the water by building this "white elephant". First of all you dont just spend 43 billion creating an asset for it to be worthless. The govt has stated that it will sell the NBN 5 years after the project has been completed. The reports mentions that by this time it will be worth 46 billion bucks in total. However there will be 16 billion of debt incurred as a result. This makes it a net asset valued ay 30.5 billion bucks. It doesnt matter which way you nudge the figures in the report to promote your own agenda/argument a reciprocal asset value will be there. At first glance 43 bn looks a big figure however if you cite 43 bn as being the cost then one must also believe that 30.5 bn will thus be recouped down the track. So from this very perspective or argument the real projected cost of the NBN infrastructure and labor will thus only be appox 13 billion spent over a perid of 13 years. That is pretty damn good value considering we are talking about a world leading infrastructure here!

kanavelkanavel September 9th, 2010
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True, but the pro NBN crowd need to look at this government's track record on delivering major projects on time and on budget. You cannot seriously take their word on this thing costing 43 Billion.

mwil19mwil19 September 9th, 2010
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Speaking of political leanings... It was said to be $26B!

RSRS September 9th, 2010
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Next time you plagiarise someone elses comments like that (with the whole mass copy/paste) it is generally polite to link the source article you got it from so others can read it.

That info was taken from an article by Nick Ross over on the ABC's Drum site

Http://www.abc.net.au/news/stories/2010/08/20/2989172.htm

JimmyJackJimmyJack September 10th, 2010
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the "white elephant" is that in 13 years time everyone will be wireless. 6G or some such. Any your NBN co will be a 30billion co that no one will want to buy.

walmillardwalmillard September 9th, 2010
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It's easy to throw comments like that out there. It seems sort of reasonable on the face of it doesn't it? Things are always improving. It's harder to put evidence behind it though.

Even if you avoid future gazing and theory.... I'm seeing small to medium businesses today whose productivity is hurting today from the maximum upload speeds on offer from ADSL2+ (it's not all about downloads people!). The best wireless on offer today including Telstra's newest efforts (up to 42mbps) still doesn't compete with ADSL2+ (very variable performance and almost never hits the declared maximum speeds).

So we get to future gazing for what wireless might be like in 13 years on "6G". The problem is that today the fastest speeds down a single strand of fibre are thousands of times faster than the best wireless demonstrated so far (and fibre less prone to wild fluctuations in performance). That's a big gap to make up even assuming that fibre won't improve.

I've seen even mainstream media commentators claim that fibre will be obsolete before the network is finished. That's the biggest pile of horse poo I've ever heard. Just like wireless and everything else, our fibre network will improve (without replacing the cable in the ground). It's already a massive amount faster and more reliable. It's a matter of replacing the equipment at the ends of the cable to improve it (no different to the exchange and modem upgrades we've seen for DSL in the last 10 years).

Mobility is important. It will become increasingly so. To declare that "wireless is the future" to try to halt fibre deployment is very short sighted. Fixed line and wireless will continue to coexist and many people will have both types of connections (as I do now)

neil_mcneil_mc September 9th, 2010
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Even all the spectrum in the world added together is hundreds of times slower than a single hairline strand of Fiber.

100,000,000,000Mbps = Fiber speed record.
1,200,000Mbps = Wireless speed record

That was just one pair of Fiber, you could easily add extra pairs to double, triple, whatever that number - the wireless record was done in the middle of nowhere with absolutely zero radio interfeerance, and used practically all available spectrum - which isnt possible in 'real world' situations.

Real world Fiber is delivering 69,000,000Mbps. Several countries have 1Gbps to the house available all over the place. Said places get 1Gbps whenever they want it, uncongested.

Real world wireless however is delivering, well, ask anyone who actually uses wireless and you'll hear some pretty colorful language.

Look I agree wireless has it's uses - it's great for mobility, but it ends there, it's not great for stability, speed, latency, wireless even uses ridiculous amounts more power to run.

The NBN is 100% Wireless and Satelitte coverage, and 93% fiber - so you have nothing to worry about if you want fast open access wireless.

DuidekaDuideka September 9th, 2010
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The nature of wireless is that any frequency band is inherently "capped" - there is a maximum ability to carry data regardless of the technology used - 6G or not. Once there, the only way to increase the nominal capacity is to increase the number of towers so that each services fewer consumers and hence each consumer gets a bigger bite at the overall stream of data.

Optical fibre doesn't have that limit and so its limitaton is the level of technology needed top get data onto and off the fibre - and that is doubling every year or two.

For a better explanation see http://www.smh.com.au/opinion/politics/back-on-the-superhighway-20100908-15199.html

Marshall2Marshall2 September 9th, 2010
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I cannot imagine any sort of wireless technology being more superior than fiber. This is because that wireless is a shared medium whereas fiber is dedicated. As you have more wireless clients hogging up the spectrum, congestion happens.
You can't beat the laws of physics.

xtaticxtatic September 9th, 2010
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its not about 1 thing being "superior" than the other. its about what people want. No one is going to "get on" the nbn from their current dsl adsl HFC or cable. You are talking about the 20% of the population that cant get 1 of the above and interweb junkies.

Even on a 1 terabyte plan at that sort of speed you will have exceeded your data cap and be throttled back to dsl. After what? 1 days use?

This sort of "but its faster" argument just doesn't wash in the financial reality of wholesale broadband.

in 13 years u will have a 40-50billion dollar network serving 5% of the popultion that is 15years out of date.

but gee-wizzz its fast.

walmillardwalmillard September 10th, 2010
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Bean counters with no future vision.
Bill gates said "Nobody will ever need any more than 64k of memory" - boy was he wrong.
People will want video phone calls, 3D high definition movies on demand, business will need to start streaming media and using video conferencing". Who knows what this will lead us to - but we can't get there unless the road is built!
If the bean counters were deciding on putting a man on the moon we'd still be talking about it. We might as well go and sit in the caves since it all costs so much to invest in the future.

lkepiclkepic September 10th, 2010
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In terms of "superiority" against wireless, it's not only speed. Fiber is more reliable (immune to electromagnetic interference) than wireless will ever be. On top of that, with my previous congestion argument, you are sharing wireless internet with other wireless technologies such as AM/RM radio, DVB, WiFi etc. There is a limit on how many connections you can make in a given spatial area before it becomes congested. Congestion doesn't only mean slow speeds, but higher latency and dropouts.
I don't know where you got the 20% figure of how many people will actually use the NBN, but I'll run with it. Over time more than 20% of our population will use the NBN because more technologies will be added which utilizes the NBN such as IPTV, VoD and other media-rich content which will saturate our current end user links. It also paths the way to future advanced applications such as Smart Grid integration systems and remote medical diagnosis. Fiber is also an inevitable technology that we will have to apply sooner or later, so why not now?
Fiber has been around since 1975 and I don't think it will be superseded by any other medium any time soon. After the 13 years you have stated, we will still have an up-to-date communications network. Because fiber is just a medium (like wireless and copper) , it's the network technology that is upgraded over time that increases it's throughput. For example, a bit over a decade ago we were all stuck on dial-up and now we have ADSL2+, but all this is still provided over the existing copper network.

xtaticxtatic September 10th, 2010
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> "No one is going to "get on" the nbn from their current dsl adsl HFC or cable."

Not true the government has made a deal with Telstra. Both the copper and cable networks are going to be decommissioned and all customers will be forcibly moved to the NBN. Only a small portion of the copper network will remain in rural areas that aren't getting ftth. So in 13 years the NBN will be used to serve almost the entire population since it is also replacing the telephone network.

hanzohattorihanzohattori September 10th, 2010
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If you already have access to Cable, DSL etc. - the network is not being built for you.

Spare a thought for all the people even in city areas who cannot get a stable ADSL, or cannot even get a copper connection at all.

Stop looking at this network as what you already have, but as what some already have.

What point is a 1TB plan when over half of the people on DSL can't download that much even if they download 24/7?

With that said, the copper and HFC networks will be turned off when the NBN passes your area, similar to how we were all 'forced' onto copper in the first place we will be 'forced' onto Fiber. It will be cheaper and faster, so no forcing should need to be done, but some people are just stubborn I guess.

If you have access to HFC now, you are one of the worst examples of why this network is being built, over 85% of the country does not have access to HFC at current, sucks to be us I guess huh?

DuidekaDuideka September 13th, 2010
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It will be more relaible until the first storm. Stringing a phone cable from a pole is a solution rooted deep in the 18th century, Or is it 17th century?? Wait you think they are going to dig up every street in the country?

IPTV - black balled in 2001 by amendments made to the Broadcasting Services Act 1992. Seams the pay/free-to-air TV ppl were terrified of "this internet thing". I can Get HD video RIGHT NOW! its called Blu-ray. pop the disk in and wallla! hi-def! So you want a 43billion $ blu-ray delivery system? Thats your best argument? Austrlia post not good enough?

there is this thing now called skype. you can make video calls on it right now!

I would really like to see the provisions in the NBN costings for these upgrades you speak of... Who will pay for those upgrades? You? Of course you will will from general consolidated revenue, because the NBN co will still be billions of $ in debit.

43billion to replace a copper PST line with a fibe PST line, just to make phone calls.

Pretty sure take-up in Tas is optional (and disapointing).

All these in-the-future arguments my mum can do these things right now. on her dsl et al.

walmillardwalmillard September 10th, 2010
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walmillard, the election is over. The liberal party lost. You can stop the spin and fear mongering about the cost making out as if the whole 43b is coming out of the public purse. This is simply not ture. Only about 1/2 of that is.

Please go educate yourself by reading the unbiased (it provides both for and against) article by Nick Ross

http://www.abc.net.au/news/stories/2010/08/20/2989172.htm

JimmyJackJimmyJack September 10th, 2010
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By your "first storm" logic, can't the same be applied to wireless access points causing multiple client failure? Wouldn't it also affect our current copper lines? On top of that thunderstorms will affect the performance of your wireless and copper networks due to EMI. Do you prefer your hospital running a wireless link?

As I stated before, IPTV is only ONE of the technologies the NBN can provide (regardless of red tape). Sure you can get a HD video, but not "RIGHT NOW." You still need to go to the store and buy it or order it over the internet, wheras with the NBN it's on demand. I don't know about you, but when i want to watch a movie, I certainly prefer not going to wait 2 days for it (post). Before you say that I'm all for spending $43 billion on a HD player, I repeat, it's just ONE of the technologies the NBN can provide.

In some applications, people require more than skype quality video conferencing. So far you can only video chat one on one with skype (except for the beta), what happens when you need a (5+) work conference? or emergency high definition medical imaging? Do I post that in a bluray?

My applications I have listed aren't part of the NBN costing, but for it to be available, a higher bandwidth connection medium must be available. Sure, you might not need some or any of these upgrades, but some people do.
So far the uptake is approximately 50% (http://www.itnews.com.au/News/215261,conroy-touts-50-percent-uptake-for-nbn-pilot.aspx)

xtaticxtatic September 10th, 2010
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Take up in Tas was low because Telstra did a real Telstra move, sent door-knockers and carpet bombed the area with pamplets - most people are locked into a 1-2yr contract with Telstra.

I have actually talked with someone who lives in Tasmania, and in her suburb alone says she knows almost noone who doesent want to take this up.

Also, the NBN cables will be underground - NBNco bought Telstra's ducts.

Not to mention a storm isnt going to effect it anyway, copper conducts electricity, not glass...

DuidekaDuideka September 11th, 2010
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We are talking about one of the most important items in terms infrastructor since the copper telephone system was built.

Telecommuncations have exploded in potential business and private use the world over, and people are saying we need to scrap it to save the money is a waste of once in a life time event.
If you focus on the long term benefits over 20 - 30 years it far outways the cost of the setp now.

Imagine an australia with no highways or roads, or the poor roads we had in the 50 - 60s and that is what we are facing in the future without the NBN.
Australia has to compete with the world, not just states or business the "WORLD" and the nay sayers have no idea how vitial it is to future proof the country for business opertunities to other parts of the world.

China, India have taken over the manufacturing center hub, as asutralia has failed to protect it manufacturing by allowing companies to off shore to increase profits, both libreal and labor have to be forward thinking and prepare for when australia has no resourses left, then what mr abbott?

The MacrossThe Macross September 10th, 2010
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