Australia's National Broadband




  • I seem to recall some Aussies around here decrying the Liberals' proposal to stop (or scale back or whatever) the NBN. I came across an article that I think is a fairly persuasive case that the NBN isn't good policy.

    @TFA said:

    Australia has spent $7.3 billion on its highly touted National Broadband Network, but made fiber available to only about 260,000 premises, which works out to over $28,000 each.

    ...

    The company has spent $7.3 billion, but passed only 350,000 premises, or less than five percent of Australia’s 7.7 million households, and only about 260,000 premises are “serviceable” (meaning that you can actually order service). Uptake is running far below expectations. The NBN has only 78,000 fiber subscribers – which at $7.3 billion works out to $93,000 per subscriber.

    ...

    As it turns out, only 23 percent of NBN’s fiber subscribers choose the company’s 100Mbps/40 Mbps offering, with the remaining 77 percent choosing 25Mbps/5Mbps or slower services. A little algebra reveals that only about 25,000 customers subscribe to a service faster than what is commonly delivered over current generation DSL connections – at a cost of about $300,000 each thus far.

    The article talks about some of the alternatives that were proposed prior to the NBN. Living on the other side of the world, I wasn't familiar with them, but they certainly sound like good deals compared to what's going on now. I'm sure the article didn't give the full picture (it's not a super long article, so that's not surprising), but how would any of our Australian denizens in favor of the NBN respond to this? I imagine some might think that it's expensive but still worth it (I'd think that's pretty nuts, but what do I know?).



  • I would think that a large-scale infrastructure upgrade is always a good idea, whether it's roads or internet, but outright burning $29 for every $1 spent* on actually connecting a home seems like very, very subtle mismanagement? Where did that money actually go?

    I'm probably underestimating Australia's geography and climate, though (what a surprise). The Dutch' 16M folken are all nice and close together in easily dug-up ground with a wonderful existing underground infrastructutre along which to align new cables.

     

    😉 7.7M homes / 0.26M connected



  • @dhromed said:

    I would think that a large-scale infrastructure upgrade is always a good idea, whether it's roads or internet, but outright burning $29 for every $1 spent* on actually connecting a home seems like very, very subtle mismanagement? Where did that money actually go?

    I'm probably underestimating Australia's geography and climate, though (what a surprise). The Dutch' 16M folken are all nice and close together in easily dug-up ground with a wonderful existing underground infrastructutre along which to align new cables.

     

    ) 7.7M homes / 0.26M connected


    They probably lost the money when they were running away from all the nopes
    .

    * in sense "nope nope nope nope nope"


  • Discourse touched me in a no-no place

    @dhromed said:

    Where did that money actually go?
    I wonder if they've been using it to upgrade the backbone itself. You wouldn't see the difference very much on the level of end-customer takeup, but it will make a very big difference going forward. A bit like upgrading the freeway network; very few places have “freeway to the premises” but that doesn't make spending on such upgrades unreasonable.

    But whether that's what the money was actually spent on, I don't know. Time for an audit, methinks…



  • I'm a long-term supporter of the NBN. Broadly it would provide much much better services to 100% of the population, compared to what they have now, in speed, reliability and cost. You can read many articles on Delimiter regarding the rise and fall of the NBN. (They call it CBN now because it is no longer "National"). The original plan was to have fibre delivered to 93% of the population, with 4% on fixed-wireless and 3% satellite. (The original-original plan was 90% fibre but they fiddled with the budget and managed to increase it) It was to make a return on investment in about 20 years. This is too long for a private company to sustain but would have been acceptable for a government own enterprise. The money was coming from bonds rather than taxation, so it was off-budget until it made a return.

    AFAICT the money quoted wasn't just spent on the fibre part, since they were rolling out fixed wireless and building and launching their own satellites too. They also had down-payments on access to ducting, building the core network (backhaul, PoIs (Points of Interconnect), etc), setting up systems and processes, etc. All those things cost money. A small amount was spent on advertising since the then-Opposition (now Government) conservative Liberal party with the right-wing media kept running their own anti-NBN campaigns. Most media in Australia is controlled by Rupert Murdoch who would see the NBN as a big competitor to his Foxtel cable network.

    Regarding the percentage on their tiers: There are 100/40, 50/20, 25/10, 25/5, 12/1 available. The last, slowest one is still faster than what my ADSL2 connects at so that comment "only about 25,000 customers subscribe to a service faster than what is commonly delivered over current generation DSL connections" is untrue. The 25/5 speed is actually much closer to this speed than the "up to 24/1" of ADSL2+. Check this map to see approximately what real connections connect at. Also, if 23% connect at 100/40 and 77% connect at 25/5 or under what about the 50/20 and 25/10 customers? Also 23% is higher than what NBNco was expecting at the moment anyway, so the wording makes it look worse than it is. FTR I would have gone with 50/20 until I could get a gigabit router to take full advantage of anything faster. Using 50/20 would have only increased my monthly spend by about $3, but massively increasing speed.

    Now I actually RTFA:

    Under the plan, Telstra would cover 87 percent of households on its own nickel, with the government pitching in $2.6 billion to extend the build out into rural areas. The catch: Australian regulators would agree to follow the U.S. model of exempting next generation networks from network unbundling requirements, thus creating incentives for intermodal competition from cable and wireless.
    Telstra is a monopoly here and this would have cemented their position. Telstra already covered most of the country in ADSL but are under regulatory pressure to wholesale it. They also run Australia's biggest cable network and wireless network, so saying that giving Telstra all three communication methods would have been insane and completely killed all competition. They aren't required to wholesale their cable (HFC) and wireless (GSM/UMTS/LTE) networks so this is what they prefer all customers to be on. HFC covers about 30% of the population (if you want pay-TV outside that footprint you need a satellite dish. The rollout stopped in the 1990s and not many new estates got it since.) Telstra does have a good HSPA+ network, for the most part, but it is expensive and still gets congested in areas with poor broadband alternatives.

    The FTTN network would have been great if it wasn't going to be a monopoly for Telstra Bigpond. The debate now would be how to upgrade it to FTTP. I noticed there was a whinge about how low the wholesale cost of the copper was. It was $9 per month for metro areas, $40 "rural" and $100 outside that (+GST). For providing a few kilometres of thin-by-world-standards corroding copper. This is in addition for charging rental space in the exchanges for the ISP equipment, plus power, plus access, plus backhaul, plus interconnect fees, plus whatever-they-feel-like fees. I've also seen Telstra connect people to ADSL where they had their own HFC in the street too, so it's not just Optus preferring ADSL over HFC, if that comment is even true. Neither Optus nor Telstra generally connect cable to multi-dwelling units so DSL is often the only way to get fixed broadband.

    Returning to the $/premeses: the report lists $720M spent on fibre access network. All of those 350k customers will have to be moved across since Telstra is shutting down the copper, which brings the cost to just over $2000 per premises. Much more in line with expectations.

    The flaws in NBN was using private (sub)contractors. This is where much of the delay has been. Telstra took 9 months to allow access to their ducts, this was budgets to take 3 months. NBNco were leasing duct access for $11billion since this would be cheaper and quicker than building new ducts. Then the ducts were full of asbestos: more delays caused by Telstra. Then contractors would agree to do the work and then just don't. They agreed to do a certain amount of work for a certain amount of money within a certain timeframe. They failed.

    The Liberals didn't "win" the election; Labor lost it. They won despite having a poorer broadband plan, but they presented one. But they are completely breaking it. They are returning Telstra to full monopoly position (fuck the hundreds of smaller ISPs) and won't do anything for me at all. They promised that I will have 25Mbps (down only, no mention of upload speed) by 2016 but they have now confirmed this promise will be broken. I'll probably be on my 7/0.9Mbps ADSL2 (that drops out when it rains, or I turn a light on, or sneeze too close to the phone) until I die!

    Labor has good ideas, but not as good execution. This may be because they expect people to do what they say they will, and/or a bit optimistic with some of the details. I'm sure you remember the insulation debacle that killed a few people? People installing metal insulation into a roof cavity with unsafe electrical wiring: could have happened any time. I blame the installers (either the insulation installer if they cut wires whether accidentally or otherwise, or the installer of the wires), not the government for that issue. Same with the NBN. The original delays were due to Telstra, later issues from the companies taking the money and not delivering what they agreed to. Anything that happened since the election is on the new government though, since they are actively sabotaging it.



  • @dhromed said:

    I'm probably underestimating Australia's geography and climate, though (what a surprise).

    The difference between a wireless network covering 98.5% and 99.3% of the population is about 1.3 million square kilometres. (1 vs 2.3) This also means 0.7% of the population has no mobile phone reception at all, and that around 72% of the landmass has no mobile phone reception. But that is all desert anyway. The highways generally have something, while cities have more choice.

    From memory there's almost no topsoil here either. I know when my parents levelled some land we dug down about 3 metres and cut through rock. Good for foundations but not when you have to cut through millions of kilometres of that!

    @dhromed said:

    but outright burning $29 for every $1 spent* on actually connecting a home seems like very, very subtle mismanagement? Where did that money actually go?

    It wasn't in full swing yet. It was projected to finish about 2021. Too many false-starts and then killed by Tony "Not Bill Gates" Abbott.

    @dhromed said:

    wonderful existing underground infrastructutre

    My phone line is delivered aerially 😞 and so is power and cable (if they would provide the features I need).



  • @Zemm said:

    It was to make a return on investment in about 20 years. This is too long for a private company to sustain but would have been acceptable for a government own enterprise. The money was coming from bonds rather than taxation, so it was off-budget until it made a return.

    I went to Delimiter, but the first article I searched on started with the words, "fake news." WTF. Do you know what the current thinking is on ROI? This all still sounds like a lot of money for you guys, especially given my impression of what's happening economically (strong $AUS, auto/aluminum industries moving out), but then again, a quick scan of headlines seems to predict good things in 2014. Still, scaling you guys to a large state here, a billion dollars isn't chump change.

    @Zemm said:

    The flaws in NBN was using private (sub)contractors.

    What's the alternative?

    @Zemm said:

    Telstra took 9 months to allow access to their ducts, this was budgets to take 3 months. NBNco were leasing duct access for $11billion since this would be cheaper and quicker than building new ducts. Then the ducts were full of asbestos: more delays caused by Telstra. Then contractors would agree to do the work and then just don't. They agreed to do a certain amount of work for a certain amount of money within a certain timeframe. They failed.

    This sounds like it was set for failure no matter what. Asbestos is a project (and man) killer.

    Honestly, when I first heard of this idea, it seemed like a Great Wall of China level project. I don't see much that contradicts that assessment.



  • @boomzilla said:

    I went to Delimiter, but the first article I searched on started with the words, "fake news." WTF.

    Renai has a strange sense of humour. He was probably calling out the bullshit spouted by the communications minister.

    @boomzilla said:

    Still, scaling you guys to a large state here, a billion dollars isn't chump change.

    GDP is around $900 billion per year from memory. What's even $90 billion over 10+ years? (The highest blow-out estimate of the project) Less than one percent!

    @boomzilla said:

    @Zemm said:
    The flaws in NBN was using private (sub)contractors.

    What's the alternative?

    Direct employees, or at least cut out the middle-company. NBNco pays VisionStream who pays Some-Guy-With-A-Fibre-joiner-thingy (Pty Ltd) which is a one-man operation. Cut out VisionStream and get control of that guy directly!

    @boomzilla said:

    Honestly, when I first heard of this idea, it seemed like a Great Wall of China level project

    More like the Snowy Mountains Scheme. That succeeded.



  • @Zemm said:

    GDP is around $900 billion per year from memory. What's even $90 billion over 10+ years? (The highest blow-out estimate of the project) Less than one percent!

    1% of GDP on a particular project like this is pretty damn significant! That would be something like $160B annually for us. Government programs are usually more expensive than even the highest estimates.

    @Zemm said:

    @boomzilla said:
    Honestly, when I first heard of this idea, it seemed like a Great Wall of China level project

    More like the Snowy Mountains Scheme. That succeeded.

    Nah...that looks like our Tennessee Valley Authority. Not grandiose enough, and too many obvious and immediate benefits. The NBN would obviously be more useful than the Wall, but I was mainly thinking about the massive scope involved. Maybe more like our first transcontinental railroad (scale-wise).



  • @boomzilla said:

    Government programs are usually more expensive than even the highest estimates.
     

    Allow me a moment to nudge you in the right direction there.

     

    Sometimes I like to think it's the money runoff from large programs that keeps an economy spinning, rather than the programs themselves.



  • @boomzilla said:

    @Zemm said:
    GDP is around $900 billion per year from memory. What's even $90 billion over 10+ years? (The highest blow-out estimate of the project) Less than one percent!
    1% of GDP on a particular project like this is pretty damn significant!

    10% of the start year GDP spread out over 10 years != 1% of GDP for those 10 years (unless GDP is static).  Yeah it is still significant, but if the 10 year cost is evenly distributed and GDP is growing then the first year it is 1%, the second year it is <1% (a little), the third is more under 1% and so on.  Of course if GDP was shrinking during that time then the percentages would be growing.  Granted if you use something like 2% annualized growth it only skews the spitballed number a little over 10 years (0.91% instead of 1%), but it can build up if you are talking a longer timeframe.

    It's still a huge investment, but when you are comparing it to things on the scale you were both using as examples spreading the cost over a longer time period is important.



  • @boomzilla said:

    Maybe more like our first transcontinental railroad (scale-wise).

    We have one of those too, but not quite as long and it goes through lots of Nothing. The NBN was like those projects plus building all the metro commuter train systems as well. Too big for the small minds of the Liberal Party!



  • The thing that annoys me is that they're expecting to run 25mbit VDSL down all the current copper. That's all well and good but we get 3mbit over ADSL2+ on an average day and 4mbit on a very good day, and even then that's only with Internode setting us on a stable line profile (we were on a standard profile but then we stopped getting line sync).

    We aren't the only people with this problem in our area... a coworker of mine lives two streets over from me and gets about 0.5mbit faster speeds than we do on Internode's normal line profile.



  • @Douglasac said:

    The thing that annoys me is that they're expecting to run 25mbit VDSL down all the current copper.

    No they're not, Turnbull no longer guarantees speeds, so stop complaining and give Telstra/Foxtel all your money!



  • @Douglasac said:

    The thing that annoys me is that they're expecting to run 25mbit VDSL down all the current copper. That's all well and good but we get 3mbit over ADSL2+ on an average day and 4mbit on a very good day, and even then that's only with Internode setting us on a stable line profile (we were on a standard profile but then we stopped getting line sync).

    We aren't the only people with this problem in our area... a coworker of mine lives two streets over from me and gets about 0.5mbit faster speeds than we do on Internode's normal line profile.

    Another anecdotal data point: four years ago, at a distance from the exchange that suggests a possible sync speed of about 8Mbps, I used to get 3-4Mbps (and plenty of dropouts). Something happened last year (rain in the ducts?), and now I am lucky if I get up to 1Mbps on a good day. This copper is not in good shape.



    Meanwhile...



  • I imagine what will happen is that good ol' Mally will buy Telstra's copper for some ridiculous price (think lots of zeroes) without bothering to check what condition it is in first. Once purchased, they will then check the condition only to discover most of it is in a poor state that can't do VDSL at 25mbit unless you put the node right next to each house. Three possible choices exist: do FTTN VDSL anyway and screw the public, it's not as if though they give two hoots while Telstra laughs to the bank; shitcan the entire project with nothing to show while Telstra laughs to the bank or go back to the original FTTP plan while Telstra laughs to the bank.

    In any case, Telstra wins $hitloads.



  • @Douglasac said:

    In any case, Telstra wins $hitloads.

    Telstra already got $11billion and of course LNP will give them more. Then they will overbuild with FTTP without having to wholesale. So "up to 25Mbps" with any provider or 100+Mbps (probably 2Mbps upload knowing Telstra) with Big Pong, exactly same as my situation right now, but available for 93% of the population instead of ~30%. This scores an A



  • Well it's not just the NBN the current government are wrecking. Looks like they are going back on most of their election promises, while still complaining about Labor. They still think they are in Opposition. One Term Tony!

    If only they could be held to account. There isn't enough coverage in the media, but that's because two powerful families own almost all the media and they want LNP in power.



  • @Zemm said:

    Well it's not just the NBN the current government are wrecking. Looks like they are going back on most of their election promises, while still complaining about Labor. They still think they are in Opposition. One Term Tony!

    If only they could be held to account. There isn't enough coverage in the media, but that's because two powerful families own almost all the media and they want LNP in power.

    You expected to get something for nothing and it's other people who are dumb?



  • @Zemm said:

    Looks like they are going back on most of their election promises, while still complaining about Labor. They still think they are in Opposition. One Term Tony!

    Actually, that strategy worked for Obama.


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