NBN: High technology pink batts

The National Broadband Network (NBN) is simply a High Technology version of the Rudd Government's Pink Batts! Although the concept of the NBN is great in theory, providing high speed broadband to every home, school, and workplace in Australia, can we really trust the Government to deliver this effectively and efficiently?

The Government could not handle something as simple as the one-off installation of Pink Batts into roofs without a cock up, leading to deaths, house fires, and finger pointing. Common sense is not something with which this Government is well endowed. Can anyone point to a Rudd Government initiative which has not been seriously mismanaged?

Nothing less can be expected of this latest proposal, with the Government going well outside of its core roles and functions. A venture of such a technical and complex nature should be left entirely to private enterprise which would pick up the ball only if they feel there is a demand, and more importantly when it is financially feasible.

As if not bad enough already, initial estimates of $4.7 billion have now blown out to $43 billion, an increase of almost 10 fold. When divided by 8 million households, this comes to a staggering $5,000 each! The $43bn question is who will pay for this infrastructure to be put in place; either all the taxpayers or just the users who take it up. Both these approaches will mean increased costs to Australians for a service most will not use.

Let's assume for a minute that a way could be found for anyone other than the unfortunate taxpayer to pay this project, I still see three serious flaws that have not been addressed:

Firstly, to produce a profit, industry experts suggest that a take up rate of between 80 - 90% would be needed, with the goal of completely privatising the venture - but not before fifteen years. According to a report in The Australian 10 May 2010, Doug Campbell, NBN Tasmania chairman, says that the best he could hope for is a take up rate of between 28 - 30%, just as Verizon found in the eastern US. This effectively renders the venture unable to sustain itself.

Secondly, it provides very little benefit for the average Australian. The majority of home users, even those with intensive downloading habits, can already access ADSL2+ enabled exchanges. This provides sufficient speeds for streaming movies, downloading music, and online gaming, the three activities that require the highest bandwidth. Businesses with higher speed requirements have at their disposal more expensive connections, which far exceed the scope of the Government's proposal.

Finally, Fibre To The Home (FTTH) is nothing new - Americans have had it for several years. The Government's own estimates suggest implementation will take 8 years, with the Coalition making absolutely no promise to complete the project! Even if the Opposition does complete the project, by the time the implementation is complete new technologies will have developed providing greater speeds again. We will end up constantly chasing the horizon, trying to keep up with the latest developments, but always ending up years behind.

If we are going to consider anything at all, let's do what any sensible investor would do - wait until a new technology is developed, tested and proven...then jump on board with it early, getting the maximum bang for our buck! Why should the unfortunate taxpayer be forced to pour even more money down the drain?

Jai Martinkovits