Monday, 23 October 2017 08:28

No profit 'unless govt protects NBN from competition' Featured

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In damage control mode again, this time ahead of an ABC programme apparently detailing more of the same issues with the NBN that have been widely publicised, NBN Co chief Bill Morrow has said that the network will never make a profit unless it is protected from competition.

In an interview with Fairfax Media, Morrow said the company was getting $43 per month from RSPs per connection and needed $52 to break even.

"We, NBN and the board, are betting that future applications are going to bring more value into homes, that they are going to need more bandwidth or more data and that the retail service providers will pay us more," he was quoted as saying.

Morrow said this was a gamble the company had taken and if it did not work out, then it would have a problem.

The NBN Co chief saw competition to the network from both 5G technology, which is due to make its entrance in a few years, and even the existing 4G technology when the towers were up.

He told Fairfax that the company was recouping its excess costs on wiring two million-odd homes that were difficult to access, by balancing the cost against the easy-to-wire city dwellings.

Last week, Morrow made a bid to deflect criticism of the network by advancing his arguments as to why the Australian rollout should not be compared to that in New Zealand.

A levy will soon be charged to fixed line competitors to the NBN Co, beginning at $7.09 per month. This is to subsidise NBN delivery to customers whose premises are difficult to connect.

Morrow said neither Labor nor the Coalition had envisaged any threat to the NBN from wireless technologies when the network was planned.

He said that while a levy on mobile broadband would not go down well with consumers, the government would either have to regulate to protect the NBN Co's existing business model or else change it.

One option is to put the NBN expenditure on budget and write it off as funding necessary infrastructure.

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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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