Rudd's New NBN: Five upsides, five downsides

by Alex Kidman  |  Wednesday 8 April 2009
Rudd's New NBN: Five upsides, five downsides

Kevin Rudd's announcement yesterday that, in effect, the winner of the NBN process was nobody was something of a jaw-dropping moment. Should broadband users be overjoyed by the NBN, or cautiously wary?

The announcement that the Government would instead invest $43 billion in a FTTH network was even more jaw dropping. But what are the real upsides, and for that matter, the downsides?

Five reasons to be optimistic:

  • 1) Promised speed increases: Up to 100Mbit, and potentially even faster again in the future.
  • 2) An open, wholesale network: Sales competition should be pretty fierce, which can only be good for customers.
  • 3) Telcos working together: Even Telstra's saying this will be a good thing -- and it'll be easier to get the NBN off the ground with Telstra than without it
  • 4) Jobs, Jobs, Jobs, Jobs: The promise of jobs -- in building, implementation and maintenance -- can only be a good thing.
  • 5) Starting this year: Tasmania this year, so it's claimed. Covering the broadband blackspots first is clever strategy.

Five reasons to be pessimistic:

  • 1) Political hurdles: Special interests. Opposition. Just plain political meddling. Anyone think that's not going to happen?
  • 2) A motza of money: $43 billion, and then similar private investment -- if it can be found.
  • 3) Eight years to complete: Eight years is a long, long time in broadband.
  • 4) Government owned: Can anyone say "mandatory filter"?
  • 5) Not Government owned: But they're also planning to sell it off after 5 years. Did failing to separate Telstra before selling it really work out?
Related Articles
See more about:  nbn  |  broadband  |  telstra  |  fibre  |  ftth
 
 
Comments: 9
mordie
8 April 2009
 Another down : new easy way to introduce Mandatory filtering / censorship on the sly....They could bypass the senate and just stick it in the build...


Comment made about the PC Authority article:
Rudd's New NBN: Five upsides, five downsides?
Kevin Rudd's announcement yesterday that, in effect, the winner of the NBN process was nobody was something of a jaw-dropping moment. Should broadband users be overjoyed by the NBN, or cautiously wary?

What do you think? Join the discussion.
gnome
8 April 2009
 Eight years to complete is not long in relation to the size of the project. The FTTP concept allows great flexibility for future scalability. And from a defence aspect, an all-fibre network is the most secure.
Faustino
9 April 2009
 The only justification for massive government-funded infrastructure funding is that it will provide greater community benefits than any alternative use of resources, including tax cuts (the "opportunity cost"). The attempt at a $4.7bn intervention with private sector operators failed to generate a viable response. Given the rushed $43bn plan, I can't believe that any cost-benefit analysis or economic modelling was done, and if it were it would surely show very negative returns.

In the longer term, we will be paying higher interest and tax rates for years as a result of Rudd's "stimulus packages", with consequent slower growth in employment and incomes. This will be further exacerbated by the NBN, not to mention the IR changes and ETS. At a time when the government should be showing restraint, it continues to "splash-the-cash." We'll all pay for it, some might get negligible benefits from NBN, but at massive cost.

The economically-destructive Whitlam government increased the size of government by 16 per cent over two years. Rudd has increased it by more than 20 per cent in a year, even without the NBN. There's no joy for techies or anyone else in this announcement.

Note: I'm a former economic policy adviser once recruited by Kevin Rudd.
Lost-Benji
10 April 2009
 The governemet should have never sold off Telecom (telstra) and they know it. By rolling out a wholesale only Fiber to customer system, it will allow government controlled compition that will allow way better positive compititon and eliminate the current monopoly that Telstra and Optus have on the infrastructure.

Telstra and Optus are both very greedy and have allot of short-comings.
.:Cyb3rGlitch:.
10 April 2009
Lost-Benji wrote:
The governemet should have never sold off Telecom (telstra) and they know it. By rolling out a wholesale only Fiber to customer system, it will allow government controlled compition that will allow way better positive compititon and eliminate the current monopoly that Telstra and Optus have on the infrastructure.

Telstra and Optus are both very greedy and have allot of short-comings.

Too bad they're selling it off once it's done.
malai5
10 April 2009
 Cybe, you know that what Governments say is not to be relied upon.
Who knows, "buying back the farm" might be just the ticket for re-election when the time comes.
All the "we will sell it later" rhetoric means is , we will cover our bases with those who wish to have a go at us for being spendthrifts at this time.

So, whether the New Government Broadband system is ever sold off, is in the lap of the gods.

Cheers

Malai5
.:Cyb3rGlitch:.
10 April 2009
 True. It's an epic waste of money anyhow. What we need is more quota, rather than speed. Essentually we'll pay a premium to waste our puny quota allowances in a fraction of the time. It's great for future-proofing, but completely impractical at this point in time.
malai5
10 April 2009
 "Future Proofing"???

It's going to take at least 8 years to roll it all out and sure it will be a great Fibre Optical system, BUT, who says that in 8 years time WiFi will not be so much better.
No matter how you cut it, cables, even if they are Fibre Optic do have physical limits, WiFi does not. At this time, with the cutting edge of sending power through the "air" to charge batteries etc, what is to say that the scope for upping the through put of WiFi isn't just a nano byte away.

Yes, an investment for the future, but a future that may turn out to be our present situation, sitting on an outdated system.

Cheers

Malai5
.:Cyb3rGlitch:.
10 April 2009
 That is also true. But I'd rather have wired than wireless, there's enough shit going through the air as it is. Not to mention latencies. We'll have to wait and see.
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