The NBN’s Three Year Plan Is Here: Now What Happens?

After a lengthy wait, NBN Co unveiled its three year plan yesterday — you can read my live coverage here if you’re still keen, or check when and or if it’s coming to a street near you any time soon through the NBN’s coverage check. But what happens now?

I attended the official launch of NBN Co’s three-year plan yesterday, and walked away a little disappointed. Not that I didn’t think it was an interesting and ambitious plan, or that it wasn’t feasible. It was simply that, having checked the coverage maps, my home wasn’t covered at all.


I’m one amongst many who lives in a destination not on the NBN three-year rollout plan. Yeah, that’s kind of annoying, but it’s also somewhat inevitable for a decent chunk of the population. As much as NBN Co was making a big thing of the three million plus planned rolled past by 2015 figure, three million ppremises — plus the 750,000 or so already either rolled past or in the schedule — is still a small part of the Australian population. That’s just mathematics; less than four million connected out of 12 million homes and premises still leaves many in the future planning stages.

I’m averse to use the term “winner” or “loser” in terms of the NBN rollout; in theory (leaving costing issues aside) the NBN will roll out past everyone in one way or another eventually. Yes, one could theoretically throw an unlimited amount of money at an unlimited amount of cabling installers and they’d quickly get the NBN past every premises… except that all those trucks would crash into each other, you’d run out of cablers and the roads would grind to a halt while cables were installed anyway. The logistics of that kind of thing must be an absolute nightmare, albeit one that it’s NBN Co’s job to sort out.

So what does happen next? If you’re in a rollout area, you should start paying more attention to the plans on offer; with many more potential customers lining up, it’s a fair bet that things will get even more competitive in the NBN plan space. It’ll be interesting to see if there’s an effect on house prices, and for that matter what NBN Co will do regarding multi-dwelling units (that’s flats and townhouses and the like), and whether that’ll change rent prices to any appreciable degree.

All of that presumes the NBN sits in a political vacuum, and it simply doesn’t. Given how political the current NBN rollout is, I should probably place my political flag in the sand… except that I’m not sure I actually own such a flag. I’d probably describe myself as slightly left of centre, politically speaking, but I don’t affiliate myself with a given political party, because I’m a human being with a wide variety of views. Politics is an incredibly variable and fluid business, and I’ve never quite seen the sense in somebody declaring themselves to be “this” or “that” party for life. Or for that matter to complain if people change minds or allegiances — that’s life, isn’t it? But perhaps that’s just me. My opinion might change.

Yesterday’s launch was as much about politics as it was about planning, with the Prime Minister and Communications Minister having the podium to themselves, and being well aware of it. It didn’t take terribly long for the Opposition to make a statement, and given I quoted Gillard and Conroy extensively yesterday, it seems only fair to let the Coalition have its say, which in this came via Malcolm Turnbull. Just so I can’t be accused of misquoting Turnbull, here’s his entire entry from yesterday, which you can also read here:

For the past five years Labor’s message on broadband has been ‘trust us’. In that time barely 5000 Australian households have actually received better broadband. The National Broadband Network is up to a year behind the targets in its own Corporate Plan published in December 2010.

Today’s three-year rollout plan announced by NBN Co and the Government is a duplicitous and ham-fisted attempt to conceal that failure.

The rollout ‘plan’ does not contain a forecast of how many households and businesses will actually be able to connect to the NBN fibre by 2015. Nor does it contain a forecast of how many households and businesses will actually be connected. Yet these are the only numbers that matter.

Labor’s spin is instead intended to make everyone feel a winner: 3.3 million premises will be in areas where(1) work on the NBN fibre network “is planned to commence” by 2015.

What does that mean?

Does it mean that these premises are in a suburb where NBN has actually dug some trenches by 2015? Suburbs where it has painted a few lines on the footpath in one street? Or merely suburbs where NBN Co hopes it might be able paint a few such lines by 2015?

Once again, Labor’s real message is ‘trust us’.

Australians wishing to determine whether or not they should trust this Government on broadband would be well-served by looking at its record and the NBN’s performance so far. There is no indication more than a fraction of the premises claimed will be connected by 2015:

On 30 June 2011, there were 18,243 premises across Australia where construction was complete and the premises could connect to the NBN fibre network.
On 31 March 2012 there will be 18,900 premises across Australia where construction will be complete and the premises can be connected to the NBN fibre network.
Therefore over the past nine months NBN Co’s fibre rollout has reached 657 additional premises –just over 3 per working day.
To reach the 30 June 2012 rollout targets in its current Corporate Plan, NBN Co needs to pass a further 137,000 premises in the next three months – which is about 2090 per working day.

Again, using the NBN Co’s own figures, on 31 March 2012 there will be 18,900 premises which can actually connect to the NBN fibre, but a further 249,600 premises “where work on the network is expected to commence” by the same date (which appears to mean they are in areas where some work has been done).

If we applied that same passed-to-commence ratio achieved up to now to the 3.3 million homes and businesses where work will be underway June 2015, then only about 250,000 premises would at that time actually be able to connect to the fibre network.

That would compare to a forecast of 4.2 million homes and businesses passed by fibre by June 2015 in the current NBN Co Corporate Plan.

In reality NBN Co will presumably do better than that – but by how much? And is achieving a small fraction of your publicly stated performance targets good enough? For this Government, it probably is.

It’s an interesting — not entirely unexpected — Coalition position, and the flipside of Julia Gillard’s insistence yesterday that under the Coalition there would be “no broadband” — a position she had to be reminded by an attending journalist wasn’t strictly accurate, what with ADSL and Cable already existing. She backpedaled slightly to state that she meant “National Broadband Network” when she’s said “broadband”. The NBN remains, and will remain while it’s a Government project of some cost, a political beast.

On the one hand, I do agree with Turnbull that, to date, NBN Co hasn’t kept to its targets per se, and that has worrying implications for further rollout plans. Having said that, the entire idea of “trial” locations is surely to sort out the more complex issues of larger-scale implementations, which is exactly what the stage one three-year rollout plan is meant to address. The fact that Telstra’s on board with the SSU should smooth the rollouts projected into the future in a way that simply wasn’t feasible up until now, unless NBN Co was to dig its own trenches — a significantly more expensive exercise.

Turnbull’s also got to tread very carefully here, given that the Opposition’s movements on broadband, via the now defunct OPEL project, a project that itself was rather politically divisive, not to mention set to use far more wireless broadband via WIMAX and far less physical connectivity. OPEL was — and this is my opinion — a simple matter of catch-up broadband, rather than installing something that might push us forwards in terms of connectivity and broadband services.

At a technical level, the NBN has far more potential, something that’s not been lost on more than a few company executives I’ve talked to recently. At a lunch for one networking provider I attended a couple of weeks ago, a visiting US company executive was positively effusive about the technological change the NBN could bring, and how relatively forward thinking the package is; it’s a technology that could genuinely be transformative for Australia.

It’s at least something of a change from many of the oft-repeated coalition attacks, such as the “our grandchildren will still be paying this off” line, which is rather tired and deflated by now, but still seems to do the rounds. Indeed, there seems to be some kind of begrudging respect for the capabilities of the NBN; this isn’t just trashing the NBN for the sake of it.

Still, the Coalition’s very heavily invested in the idea that the NBN will not be part of its policy planning going forwards, and it seems unlikely that they’d do a massive backflip on that for the time being. Again, it’s politics, and anything can happen, but without some big shifts in the Liberal party, I wouldn’t be betting on it. What that means at the next election is tough to call; we’re still a fair way away from it, and by the time the next election rolls around the NBN could well be a minor issue amongst many.

(1) Malcolm’s text at the time of writing reads “whee” here. I presume that’s a typo.

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