NBN In 2018: A Litany Of 'Lies' And Broken Promises

Image: Getty Images

With 2018 shaping up as an election year - we could go to the polls as early as 4 August 2018 if the government calls it - a number of key battleground issues are forming. One of those is the National Broadband Network. Both governments have policies around the NBN with the electorate finally realising it's a significant project that is important to everyone.

So what have been some of the biggest NBN promises that were ultimately broken? Um, this might take a while...

FttP for (nearly) everyone

The original NBN plan, proposed by Labor in April 2009 proposed Fibre to the Premises (FttP) would reach about 90% of premises with download speeds of 100Mbps.

But once the Abbott/Turnbull government arrived, things changed. FttP became a less popular option, replaced by a combination of satellite, wireless, copper and HFC.

NBN Hacker: The World's Most Confusing Network Explained

We thought we were going to enjoy 100Mbps of speedy internet access. Then the politicians got involved and we ended up with something of a dog's breakfast - or dog's vomit according to some. So, what are the connectivity options that the NBN will deliver and how do they differ? Let's take a look.

Read more

As we come to the election. Labor is promising 39% of homes will get FttP. That's about two million more homes that the current plan under the Liberal and National Coalition but still a long way from the original promise.

The beauty of the fibre option is that you can purchase plans with multiple RSPs and aggregate the bandwidth as some commenters noted in a recent story we published.

Along with that technology change, we've had to swallow a big performance hit.

Speed Bumps

The Coalition's plan promises connection speeds of between 25Mbps and 100Mbps"

Given we are no longer talking about a predominantly fibre-based network, the hope of almost everyone getting access to a 100Mbps network looks a little shaky. But the good news is NBNCo has done some work to try and bring the fastest possible speeds to more people. And while RSPs (Retail Service Providers) are offering 12Mbps plans, uptake of faster plans is on the rise. That's come about as a result of RSPs being forced to buy enough CVC (Connectivity Virtual Circuit) to adequately service customers and decreased wholesale rates.

So, while the promise of fibre won't be honoured by either party, there's a good chance we'll have decent speeds - at least for now.

At some point, the remaining copper and HFC being used by NBN Co will need to replaced.

Show Us The Money

The one number that seems to be hardest to actually pin down is what the NBN will cost to build. Part the challenge of coming up with a definitive number is that construction methods have changed. For example, when the NBN was initially proposed, the connection cost per premises was estimated at $3700. But changed techniques, such as those used in New Zealand, trim close to $1000 from that cost.

If Labor wins the election later this year, we can expect the HFC network to be eventually phased out, assuming they stay in power long enough, which will cost about $19.9b or a little under $1700 per premises when averaged out across the entire network.

What's clear is that no-one really knew what the network would exactly cost when the project started five years ago. The Coalition said Labor's plan would somewhere between $74b and $94b depending on who you asked and when you asked them. Labor maintained the network would cost less, more like $43b when they first proposed it back in 2008.

When the Coalition came into government, a review said the NBN would cost about $41b to build. Under the government's multi-technology mix. NBN Co now says $49b is expected.

Rollout Dates

Under the more supposedly more expensive and longer-running Labor program, those $43b dollars should have been spent by now and most of us would all have a FttP connection. But the timeline has stretched under the less expensive and faster Coalition project we were promised.

NBN Co's most recent corporate plan says that the project will be completed in 2020 with about three-queartes of the country connected now.

The most recent weekly connection report says 6,855,842 premises are ready to connect. that means the physical installation is complete. All that remains is for customers to choose an RSP and flick from their current service to the new one.

Of those 6.8m premises that are ready, a little over 4m have taken that step.

So, the initial promise that it would be all done this year is fading into history with 2020 the next target date.

Have We Been Lied To?

The problem with answering that question is that the goalposts have shifted many times. There was a near-maniacal adherence to the "fibre is bad" mantra from some politicians and the media. But there was a similar fanaticism for fibre.

Ultimately, the decision to go for the multi-technology mix was made through a federal election where the previous government's biggest problem wasn't so much about policy but internal fracturing which resulted in distrust in Labor's ability to govern. And when they were pushed from office, their NBN policy went with them.

At that time, both major parties had a policy and the were committed to that policy. So, while the goalposts moved, we knew it was coming.

The question of costs is challenging. It looks like the cost of the coalition policy is pretty close to the cost of the Labor policy. Whatever cost savings we expected from moving to the multi-technology mix seem to have been lost. Labor's projected cost was $43b while the current plan is $49b. The kind of difference is relatively small given the scope of the project.

A far as speeds go, despite some substantial hiccups along the way, it looks like a substantial portion of the population will have access to 100Mbps connections.

So, it's hard to say we've been lied to. But what we have seen is a number of politically motivated changes in the project's scope that have resulted in confusion.

Under the original Labor proposal, things were simple. Most of the population had the same connection type - FttP - and we could have reliable access to 100Mbps.

Under the coalition policy things aren't as straightforward. There are multiple connection types, each with its own benefits and challenges. The complexity of managing different connection types has made support more challenging and we've seen the HFC program delayed because of problems with the infrastructure. But the coalition made it clear at the last election that this was their policy.

We've likely had some "creative accounting" released when each party has provided costings on their own and their competition's solutions. So we'll never know whose numbers are right because the project has changed tack several times.

I don't think we've been lied to. But I do think finding the truth has been made extraordinarily difficult.


Comments

    The original costing of Labor's NBN plan was $6 billion, then when the accountants had a look at the project, it was over $90 billion. Hence why it was moved to multi-technology. Once Labor had Australia's economy in the red, we simply couldn't afford it. The question is still out there - why did we need an NBN at all? Turns out it was simply a bad thought bubble by a bad PM (Rudd) and Stephen Conroy.

      Are you able to provide a link to that statement? I have not seen those figures before.
      Also, I'm uncertain as to why you think we don't need NBN. Can you elaborate?

      Talk about re-writing history, That 6 billion you say was for a tender that telstra purposely submitted as non-compliant for a fttn build. Then after that labor changed it to a full fttp build for 43billion. You forgot to add that when the liberals got in they had the gov audit office and PWC go through the books and found nothing untoward with the nbn. (if they did it would have been screamed to the hills)

      Also what happened to a fully costed 25 megabits to all by 2016 and not a cent more than 29 billion ?

      Do you get all your facts from Andrew Bolt?

      You obviously had better ADSL+ speeds than I was getting: 0.69mbps according to Speedtest in 2013. It slowly went up, but I was still not getting anything like the 10mbps that people in Sydney and Melbourne were complaining about getting on ADSL when I switched to the NBN a month back. I could not even watch a YouTube video let alone stream anything. I may not get quite 50 mbps, but I get over 40 mbps in the evenings, and I am not complaining, but once the rest of my area signs up I may not be so happy. Hopefully the copper will totally disintegrate by the time that happens, but then pigs fly too.

      I am FttN and I have no idea where my node is, but 2 streets over they have FttC. I have no idea why we missed out.

      Last edited 02/07/18 12:50 pm

      Is this user Malcolm Turnball?
      We had the money, it's just the government is crap. Malcom Turnball shouldn't be our PM.

    The cost benefit analysis is completely broken. They see a 10 billion highspeed train that would only service 100,000 people a year is more valueable than a 90 billion highspeed internet that would service 20 million people, corporate business opportunites, improve education, deliver digital health innovation, improve entertainment and generate small business. ICT is the largest employer in this country, the internet is a new backbone for society in all aspects... and we treat it so poorly.

    We could be 5 years ahead of the world in digital education and health, if we didn't have a network that has such a huge cost and barrier to entry and speed. NBN rollout has been connected to increase employment through new business opportunities and self-employed start ups.

    We would have an improved economy if the NBN board didn't think it was all just computer games and netflix.

    Reading this article on a FTTP 100/40 connection in TAS.

    We haven’t always got the advertised speeds. Depending on the device, connection, time, and speedtest server, speeds fluctuate between as low as 60+ to under 90 Mbps, never the full fat 100. We regularly get 80-something Mbps via gigabit Ethernet. One time last year our iPads were briefly getting 120Mbps. So yeah, it varies a lot.

      Those are issues with the ISP's though, not the ability for NBN to deliver 100/40. ISP's buy barely enough bandwidth to cover needs, with no capacity for usage spikes. Peak hour in other words. Reasons are purely down to cost, but they can do it.

      Thankfully, there are recent changes to encourage them to get more capacity so you should hopefully see those speeds up near the maximum more often. Assuming the ISP's play ball and take up the cheaper CVC, and don't just pocket the savings as profit.

      In FttP areas though, the NBN is capable of at least 1 Gbps, ISP's just don't offer those speeds.

    Simply saying the Labor party were pro FTTP and the Coalition were against it, betrays the full story.

    In the lead up to the 2007 election, Labor promised a 6 Billion dollar FTTN network. After they won and the crazy mexican at telstra (good old Sol) wanted to destroy them, they moved to a FTTP model that would have bypassed copper cable altogether. From that point, $6b was never in the frame and it jumped to a proposed $49b product.

    While I am not against what the coalition have done, the FTTN component of their MTM has clearly been a disaster. They have somewhat fixed the MTM model by including FTTC into the mix, but we all know that FTTP was always going to be the better option.
    The big mistake the government has had was removing the greenfields requirement for FTTP. That is just stupid.

    The HFC model should have worked and to me was sensible, it just seems as though the implementation was never great. Once Foxtel depart the cable and Telstra switches off their services, it should actually give NBN some room to move in the HFC space and maintain the network for just a bit longer.

    As for accounting... it was all about the accounting. The coalitions cost estimates around MTM was based on the fact that as they would be recycling existing technology, they would get more users onto the network quicker and in turn paying money to use the system. This would offset the cost.
    AFAIK the actual capital cost of the NBN under the MTM mix is barely cheaper than the FTTP rollout.

    Its an interesting topic that really could be discussed for hours.

      Its an interesting topic that really could be discussed for hours.

      Hours? :p

    proposed by Labor in April 2009

    this is the part thats annoying me so much. its been going on for over 10 years now and political red tape, gross miss management and a general lack of understanding technology has been and continues to hold our country back. yet the majority of people sit back and put up with it. its BS that its taken this long and will take many more years and at the end of it were gonna end up with a useless system anyway.

    What most people forgot is, That anything other than full fttp, Is just adding to the cost and delaying the enevitable.

      Just on this, with FttC that future cost is low enough that I think its acceptable to the homeowner to upgrade the copper to fibre. Its no different to how a new phone line goes in, only the conduits are already there. You really just need to pull through along the existing phone line, and come in through the same jack location.

      HFC, nothings changed. It was always needing to be upgraded its only a matter of when they replaced it. Its problem was with people that couldn't access it before NBN for one reason or another. Strata units for example. But that's a different issue.

      Its FttN that's killed it for me. That's completely wasted technology given how little time there is between its rollout and the need to replace it. There just isn't enough time to recoup those costs.

      Everything else either hasn't changed, or that future cost is low enough you can offload it to the homeowner when they feel the need to upgrade.

    The current state of the NBN is not in any way the fault of labor. Anyone proclaiming its labors fault is either wilfully ignorant or just a moron. While labors FTTP was not costed properly (what government project ever is?) it was still the best and future proof network. Abbott and Co's replacement is a complete joke. Copper is outdate. Fibre is superior.

      "While labors FTTP was not costed properly" You answered your own question. Labor can't manage a project. Period.

        Good job on completed ignoring the point of my comment. But please, Do keep living in your bubble of ignorance. You are like someone saying the horse and cart is fine and we dont need the car.

        You are stuck in the past.
        The world is moving ahead without you.
        You will be left behind.

        You ignore that by all acceptably accounting methods, Labor's view that it was cost neutral was correct. Anyone that disagrees is either biased politically, or has little to no understanding of real world economics.

        Cost benefit analysis means nothing if the ultimate cost to the Government is zero, as planned, expected, and globally agreed on. Most economic forums praised the original FttP model for its economics, citing the original plan as an example of infrastructure done right.

        Except here in Australia, where politics meant it had to be destroyed at all costs, just to save political face.

    Do I need NBN? Ans No
    Do I want NBN? Ans No
    Did I ask fir NBN? Ans No
    Do I have NBN? Ans Yes

    No body ever made a statement that regardless of what people want we are forced to have it regardless.
    Thousands have experienced extensive delays getting a connection they didnt want and how many services have failed when there is a mains power failure.

      Do I need NBN? Yes. My internet is too slow for what I need it to do.
      Do I want NBN? Yes. I want fast internet.
      Did I ask "fir"(?) NBN? Absolutely.
      Do I have NBN? Yep, FTTN, and it sucks arse.

      While you might not need a faster internet connection that can accomodate future needs, as well as those of today, many other people do.

      "I dont need this thing, Therefore no one else needs it"

      Sound logic bud.

      Change NBN to 'schooling' and think about what you wrote. I don't need, want, or ask for schooling, but I got it when I was a kid. As I don't need it now though, why should I pay for it?

      Because its important for the future. All infrastructure is like that. YOU may not get something specific out of it today, but 5 years from now, 10, 20, 50...? You most certainly will.

      Otherwise our communications wouldn't have progressed past the telegraph wire 150 years ago. Nobody needed a phone in their home, those phone lines are a waste of time. Nobody knew anybody in the next city, why have trunk dialing? Nobody knew anybody overseas, why have international calls? Nobody is ever going to want a portable phone in their pocket, its stupid. All of those services were forced onto us.

      Copper's hit the end of its life in terms of data transmission. For that alone, fibre is needed, and will be needed for a long time to come. Its the next step in our communications evolution.

        As an analogy, your kid might be the next best thing since say Bill Gates or Steve Jobs.
        How best to ensure that when he gets there you had set him up with the biggest house, the fastest car and the best education money can buy? Should you right now go and buy the fastest car & biggest shiniest house? If he gets his drivers licence in the Bugatti, he never need to learn drive a rickety old crock. As for the house, it should be no problem getting a loan to buy something in Toorak or Point Piper, as long as it cost more than a tiny shiny top floor apartment in Hong Kong, right? Because it will pay back itself in say 10, 20, 50 years. Banks should just lend money to every Australian to do this, because ....it....will ....pay ....off.
        I am NOT saying NBN is angelic, nor is the government!!
        But everyone seems to think paying for the stuff we need for kids homework and netflix and gaming is the DUTY of the government to provide YESTERDAY and that the government is a money printing machine. Then everyone loses their shit when taxes go up to pay for this folly.
        Copper is dead. Fibre is the future, right?
        What if I were to speculate that in 5, 10, 20, 50 years from now we could be using wireless or fibreless more effective & less costly? That is indeed the next step in the communications evolution.

          Your arguments are a bit all over the place, I'm not really sure where you were trying to go with them. But I'll try.

          This is about the future, we agree there. Copper is also dead, we also agree there. The thing with the future is that until a dynamic change happens, advances are usually progressive rather than revolutionary. We've merely hit a point where progression can no longer deliver, and need just a tiny revolution to get to the next era. Copper has served us well for 150 years, but its day is done.

          Problem with wireless is there are several issues not easily solved. Firstly, it still relies on fixed line. Secondly, contention means it slows down rapidly if there are more than a handful of users at once. Thirdly, its not very good with lots of data. Fourthly, its security is much easier to compromise.

          Good people have been working on solving those problems since the 90's with no luck. Trust me on that, I have family considered experts in this field that were researching this stuff in that era.. One or two can be fixed, but just reinforce the need for fixed line. Contention can be sorted with more towers, but that means more fixed lines from those towers to the exchange.

          There are times the Govt needs to step in and build the infrastructure. On a wholesale level, they should never have let Telstra run off with that infrastructure in the first place. It was never ending well, and is one of the key reasons we're in the spot we are today. Now we're pretty much rebuilding it anyway, and taking Telstra out of the wholesale game.

          Thats not to say the Govt should pay for the full rollout, though when it was a choice between FttP and FttN, it was the better choice. I'm a big fan of FttC though, and leaving that last 10m or so to the homeowner to pay for.

          I think that the cost to the homeowner gets low enough to be reasonable when they're just replacing copper from the Telstra pit outside their home. Not everyone agrees, that's fine.

          On the cost though, yes, I actually think it wasn't a bad thing for the Govt to pay for this stuff. On a year by year cost it wasn't big. $6b out of a $600b budget is 1%, well worth it to rebuild our entire communications infrastructure to serve us for the next 50 years or more.

          That cost becomes zero over time though as we all have little choice but to connect to it. At its simplest, rather than pay $25 to Telstra for a phone line rental, you pay NBN. With 12 million houses, and 2 million businesses, the dollars were pretty easy to predict, and were pretty stable - $4b-ish a year. Once built, it recoups its costs eventually, meaning net cost of zero, before being a potential revenue stream. Whether its 10 or 20 or even 30 years before that happens, it would have happened. Nobody disputes that.

          When you have the consumer paying back the cost, as well as it being spread over a decade, funding for it isn't the issue you seem to think it is. And most economists who do this sort of thing as a job agreed. Cost benefit analysis, and Govt funding aren't a concern when it creates a positive revenue stream at the end.

    "Of those 6.8m premises that are ready, a little over 4m have taken that step."

    2 Things to note or speculate on.
    1. Uptake is very slow. Under Labor we would not have 6.8m ready premises today and the uptake to date would have been less with less money pouring into NBN (to keep the circus on the road).
    2. Even with FTTP for everyone, why do most people opt for 12/25/50 options? At which point it doesn't matter if it is FTTN, HFC or whatever. Seems like Netflix & games is after all what it is used for most, why else would we have congestion from 7-11pm?

      1. Uptake is very slow. Under Labor....

      Speculation. As the rollout has changed so drastically in the past 5 years, there is absolutely no way to tell where FttP would have been by now. The hard work of setting the process up had been done though, so the counter argument is that there would have been more people with access to FttP than there is for the whole NBN today. Prove me wrong.

      why do most people opt for 12/25/50 options

      ISP's push people onto lower plans, because that's where their profit is. You also have every area in Australia that doesn't have FttP being incapable of anything higher than 50 Mbps. Fun fact: when you sign up to Telstra, they only offer up to 50 Mbps when you sign on regardless of your actual options. That can change later, but that doesn't get reflected in stats.

      Do a comparison of what people end up with in FttP areas though, and its either 12 Mbps or 100 Mbps. Most people, NBN included, are spruiking how many people are on their maximum speeds these days.

    The bitterness of the situation is a government monopoly has been created where free market may have been a better answer. One may want his 100Mbps but his government copper would not allow such frivolities. Not to speak of 1Gbps that Singaporeans/Japanese enjoy since 2010 or so...no 8K streaming for Australians anytime soon. This is why many are cutting the cord, the price/value is not always there to add much more to large-screen mobile devices that have replaced dying/infested desktops. And I thought the Soviet way was smeared enough ...

Join the discussion!

Trending Stories Right Now