Wednesday, 24 October 2018 08:50

NBN Co chair rules out write-down, says network could sell for $50b Featured

By
NBN Co chair rules out write-down, says network could sell for $50b Courtesy YouTube

The chairman of NBN Co, the company rolling out Australia's national broadband network, has told Senate Estimates that the NBN could still fetch a price of $50 billion once it is fully rolled out in 2021.

Ziggy Switkowski, former head of Telstra, also said on Tuesday that in his personal opinion, a write-down of the network was not needed, The Australian reported.

Earlier this month, the Shadow Communications Minister Michelle Rowland said the Labor Party was keeping open the option of writing down the value of the NBN if it won the next federal election, which is due by May 2019.

And in July, the ratings agency Standard & Poor's said the NBN would not return a profit from the billions invested in the project, adding that the NBN Co's business model had led to telcos investing heavily in mobile services to avoid paying the company's inflated prices.

S&P has also pointed out that the advent of 5G networks will not provide any kind of salvation for telecommunications providers who are desperate for some way of fighting back against the unreasonably high prices charged by NBN Co.

Switkowski told Senate Estimates that the price the network would command depended on the privatisation process, the state of the company and the regulatory settings in place at the time.

“While there are downside risks, the current valuation is supported by our full-year projected numbers, I can certainly generate figures around $50 billion for the value of this enterprise in the early 2020s," he said.

“Write-down is not the within the gift of management or government, they are driven by accounting rules. The network is not complete, we currently don’t have the customer base we expect to have by 2020, the ability to properly value this asset probably won’t be available to us until the 2020s.

“I can rule out a write-down, this is my personal view. Any consideration on the value of the NBN will await until the business moves into a relatively normal, conventional mode, which will happen when we finish the build in 2020, we compete the conversion of all households and business in 2021, we turn cash-flow positive and then whoever needs to make the judgement will make it then."

CHIEF DATA & ANALYTICS OFFICER BRISBANE 2020

26-27 February 2020 | Hilton Brisbane

Connecting the region’s leading data analytics professionals to drive and inspire your future strategy

Leading the data analytics division has never been easy, but now the challenge is on to remain ahead of the competition and reap the massive rewards as a strategic executive.

Do you want to leverage data governance as an enabler?Are you working at driving AI/ML implementation?

Want to stay abreast of data privacy and AI ethics requirements? Are you working hard to push predictive analytics to the limits?

With so much to keep on top of in such a rapidly changing technology space, collaboration is key to success. You don't need to struggle alone, network and share your struggles as well as your tips for success at CDAO Brisbane.

Discover how your peers have tackled the very same issues you face daily. Network with over 140 of your peers and hear from the leading professionals in your industry. Leverage this community of data and analytics enthusiasts to advance your strategy to the next level.

Download the Agenda to find out more

DOWNLOAD NOW!

Sam Varghese

website statistics

Sam Varghese has been writing for iTWire since 2006, a year after the site came into existence. For nearly a decade thereafter, he wrote mostly about free and open source software, based on his own use of this genre of software. Since May 2016, he has been writing across many areas of technology. He has been a journalist for nearly 40 years in India (Indian Express and Deccan Herald), the UAE (Khaleej Times) and Australia (Daily Commercial News (now defunct) and The Age). His personal blog is titled Irregular Expression.

VENDOR NEWS & EVENTS

REVIEWS

Recent Comments