Wednesday, 13 February 2019 11:41

NBN write-down no solution; what about upgrade, asks ISP Featured

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Damian Ivereigh: "Let’s stop thinking about how we can give everyone a price cut and instead think about how we get the network that Australia clearly needs." Damian Ivereigh: "Let’s stop thinking about how we can give everyone a price cut and instead think about how we get the network that Australia clearly needs." Supplied

The head of a small Internet service provider has questioned whether a write-down of the value of the national broadband network will end up being the panacea it is increasingly painted as, pointing out that the main problem facing the network is how it should be upgraded to full fibre after the initial build is over.

Damian Ivereigh, chief executive of the Launceston-based Launtel, said in a blog post that he thought merely having a write-down of the network's value was too simplistic and short-term.

He said he could understand the logic behind the  calls for a write-down; with a sub-standard network, people were getting slower speeds than they expected and tended to feel that they were paying too much for a dud connection.

The wider issue should not be neglected, he said. "So should the debt be written down? I think it is important to look at the wider issue here: we have a less than stellar network and this needs to be fixed.

"The Federal Government can write down the loan, which would allow NBN Co to reduce its prices, but then how do we get the network upgraded? How is that going to paid for? Will it even be done?"

Ivereigh said any write-down should come with a plan — possibly another $25 billion loan — to pay for the upgrade.

"At the end of the day we all know the end goal is FttP. There is no other technology that comes even close to the same reliability, stability and performance. We can argue about whether we need it now, but we know that in 20 years time we will absolutely need it," he said.

"When a commercial company (a telco) performs upgrades they do it slowly, using interim technologies such as FttN, FttC and HFC, to guard their cashflow (get enough revenue on the way), but it is not an efficient way to do it.

"Governments can instead take the long view, see the end goal and just map a direct course there. Governments can understand that their return on investment isn’t just the money, but also the societal and wider economy benefits."

Ivereigh said using what the NBN Co calls fibre-to-the-curb — where the copper lead-in to a dwelling is about 300 to 400 metres — to upgrade fibre-to-the-node connections was a halfway solution which had many potential issues.

"Firstly, it is a very new and untried technology – Australia is the first country to roll it out in a big way," he said. "Secondly, it is unclear if there is an easy upgrade path from FttN to FttC (an FttC service can interfere with your neighbour's FttN).

"And thirdly, nobody knows how long those units in the street will last in the hostile environment of the street pit.

"Finally it is yet another interim technology that is just a distraction from the end goal – FttP. Australia is a big country – we can’t keep rolling out new technology over and over again."

He said there was no way around it; one had to accept that the switch to a multi-technology mix by the Coalition Government in 2013 was a big mistake. "We have essentially thrown at least $25 billion down the drain (though to be fair this money has entered our economy, no government spending in the local economy is ever wasted – people get employment for example).

"Had NBN Co stuck the course with FttP we would have spent about the same amount of money and almost had the FttP rollout finished by now (don’t believe that $96 billion figure put out by the incoming Liberal Government)."

Ivereigh said it was time to realise that while Australia could not change its past, it could resolve not to repeat the same mistake. "Let’s stop thinking about how we can give everyone a price cut and instead think about how we get the network that Australia clearly needs," he added.

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Sam Varghese

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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.

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