Promises, promises: Government changes tack on NBN

Stuart Corner
Tuesday, 07 April 2009 07:06

Opinion and Analysis

Three weeks ago communications minister Stephen Conroy was adamant that the Government would fulfil its election promise of an FTTN network delivering at least 12Mbps to 98 percent of the population, that the RFP process would run its course and that Telstra had Buckley's chance of getting back in. Today's announcement breaks all three of those promises.

At the time I commented that "Any doubts that communications minister Stephen Conroy will soon announce an NBN decision that is at least close to what the ALP's pre-election promise envisaged were comprehensively quashed by his comments at the ATUG conference today. Likewise, if Telstra thought it had the slightest chance of getting back into the NBN process, that prospect was also comprehensively quashed."

So I was wrong, but that was very definitely the impression that Conroy created. I was right on one thing though: "There is however one funding possibility that in the current climate is looking extremely likely: total or greatly increased government funding."

Prime minster Kevin Rudd announced this morning the scrapping of the NBN RFP and establishment of a new company to build and operate "a new super fast National Broadband Network."

He said that it would connect 90 percent of all Australian homes, schools and workplaces with broadband services with speeds up to 100Mbps via FTTP and connect all other premises in Australia with next generation wireless and satellite technologies that will be deliver broadband speeds of 12Mbps, and support up to 25,000 local jobs every year, on average, over the 8 year life of the project.

The network will be built and operated by a new company specifically established by the Australian Government to carry out this project. The Government will be the majority shareholder of this company, but "significant private sector invest in the company is anticipated." And that, reportedly includes Telstra. This company will invest up to $43 billion over eight years to build the national broadband network.

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