Malcolm Turnbull has been crowing in his blog about a fibre to the premises (FTTP) speed trial conducted by Alcatel Lucent in an apartment building in Canberra.
"Since the change of government, NBN Co has been trialling that previously prohibited technology. The first results are in — in an apartment building in Melbourne, over 150 metres of internal copper wiring is delivering download speeds of 108Mbps, upload 48Mbps.
“That’s blisteringly fast and at a fraction of the cost of taking the fibre into every apartment. He said that under Labor the NBN was not allowed to do this. “Labor forbade NBN Co from using ‘fibre to the basement’, which means terminating the fibre optic cable in a multiplex in the telecom room of an apartment or office building and linking into the existing copper local area network.
“This saves considerable time, trouble and expense. But Labor did not want to compromise in anyway its promise of FTTP – regardless of cost.”
Under the Labor government NBN Co had advocated a fibre-to-the-basement option as part of an alternative method of accessing apartment blocks (so-called MDUs, or ‘multi-dwelling units’), including a separate policy for it in the draft 2012 corporate plan, but when the policy document was submitted to the Labor cabinet the proposal was removed.
As it currently stands the highest-speed broadband plans with the NBN for customers are 100 Mbps download and 40 Mbps upload, though NBN Co plans to introduce plans involving speeds ten times that this month.
Turnbull came under heavy fire last week for breaking several of the Government's election promises regarding the NBN, including a guarantee that all Australians would have access to at least 25 Mbps by 2016. But he remains unrepentant, blaming it all on Labor.
“Labor’s biggest mistake with the NBN was establishing a government owned start-up company to build the largest and most complex infrastructure project in our history. It is worth reflecting on the scale of the folly. Almost every country in the world is in the process of upgrading its telecom networks to deliver high speed broadband. And almost invariably the model is the same: private sector companies, generally telecoms, are doing the job and Governments are providing subsidies of one kind or another to ensure that people in non-urban areas get a comparable service to their city cousins.
“The virtue of this approach is that the Government is up for a sum certain – it makes a political decision and writes a cheque. All of the execution and business risk lies with the private sector firms building the network upgrades – they have decades of experience rolling out networks and the workforce and culture to manage large, distributed linear infrastructure construction.”
Turnbull then gave New Zealand as an example, talking about how Telecom NZ had split in two, and how the Ultrafast Broadband (UFB) network is costing the New Zealand Government just $600 million (no mention of the basket case spun off infrastructure company Chorus has become).
“We have received a Strategic Review which for the first time provides a spin-free account of where the project is at the moment, how much it will cost and how long it will take to complete on Labor’s corporate plan and what options are available to us to complete the project sooner, cheaper and more affordably.
“The Review was compiled by the NBN Co itself with independent advice and assistance from Deloitte, Korda Mentha (which concentrated on the business as usual trajectory) and Boston Consulting Group (which concentrated on the available alternatives).
“I have told NBN and its staff that I don’t want them to ever frame their forecasts or reporting with a view to what they think I want to hear. If Labor’s plan were continued with the project would have a peak funding requirement of $73 billion, not $44 billion, and would generate, on the most optimistic revenue assumptions, a 2.5% internal rate of return, not the 7.1% claimed by Labor. By 2016 only 22% of Australians would have 25 Mbps broadband, by 2019 only 57% would have 50 Mbps. It would be complete in 2024.
“The Review recommended a different approach be taken, using where feasible the existing copper lines for the last few hundred metres into the home and the HFC networks originally built to carry pay television.
“This multi-technology mix model would have a peak funding requirement of $41 billion ($32 billion less than business as usual), deliver 25 Mbps to 43% by 2016, 50 Mbps to 91% by 2019 and be completed in 2020.”