Another step forward for the Coalition’s NBN Plan

In our assessment of the Coalition’s NBN plan a couple of weeks ago we indicated that we saw it as a step in the right direction, but that there were still plenty of questions that needed to be raised and answered.

We did not expect that a couple of weeks later Malcolm Turnbull would come up with further explanations.

While there are still plenty of uncertainties in their plan the good thing is that the Coalition has constantly moved forward and that is very encouraging.

In all reality, if the Coalition were to have launched its $30 billion plan back in 2007 everybody would have been most enthusiastic, and the plan as it stands now would have received the same positive welcome that the government’s NBN plan received in 2009. There would also have been a good chance that if this plan had been presented at that time they actually could have won that election. So the will of the people – who at least partly voted for Labor because of their NBN plan – was clearly ahead of the political will of the Coalition.

Of course, just like there is today, there would have been strong political opposition from the other side, but, as is the case with the current NBN plan, the majority of people (some 70%) supports this type of investment, so at that time – looked at it in isolation – that plan would have received a similar level of support.

In reality most of details of the investments, and the technical elements discussed ad nauseam by politicians and industry people both then and now, go straight over the heads of 90% of the population. People simply want better access to internet and are more than happy to leave the details to the experts. However, at the same time, based on our experiences with the broader public, they also very much understand the need for a long-term infrastructure investment – they clearly understand that this is a nation-building exercise and that it should not be a quick and cheap fix.

 As Labor NBN deployment is now well and truly underway the problem for the Coalition is that they will have to sell the Australian people on the fact that, under their government, they will end up with an inferior service. A question we would like to ask here is – will it really make such a huge difference that, over a period of 10-15 years, we are investing $14 bn more on a national infrastructure plan? So far there is no indication that much more than perhaps 20%-25% of the population would see that as a major problem, and that will mainly be based solely on political conviction. Also no direct budget consequences are applicable, as it is a long-term national investment.

Returning to the additional explanations on Malcolm Turnbull’s blog, most of them make sense. The only comment we would make is that their promises, assumptions and plans are equally risky. As to their assumptions that the government’s plans might blow out, and might be further delayed – these risks apply equally to the promises in their plans. There is no guarantee that the Coalition promises are any more reliable than those of the government.

The key points that I took away from the latest information is a much clearer view and explanation on how the Coalition is taking into account the planning towards FttH via the in-between step of fibre-to-the-node. While I am not a financial expert the information given on what the financial advantages could be does make sense. Also a firm confirmation that the Coalition will continue the rollout of the current NBN, and only begin to make major changes once they have properly assessed the situation, is important.

Further ideas on how to incorporate HFC, and the background information they have gathered on the quality of the copper network – backed up by comments from Telstra’s CEO – are appreciated.

While we had already made positive conclusions along these lines based on previous announcements, it is good to see these confirmed and explained in more detail by the Coalition.

We look forward to the next instalment.

Paul Budde

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