Over the past three years we’ve seen some quality acting from the Earl of Wentworth, Malcolm Turnbull. From decrying transparency, to claims that HFC is the future, to demanding a cost-benefit analysis (CBA); Turnbull has been critical of everything National Broadband Network (NBN).
Since the Liberal party won the 2013 election, Turnbull has taken, with gusto, his role as Communications Minister as a signal to do what he wishes with the NBN. Sacking the board and stacking it with ex-Telstra executives, starting no less than 5 reviews/audits/time wasters, deliberately slowing the rollout down, and most of all, blaming Senator Stephen Conroy for every failure since taking over the position.
It should come as no surprise that the man who claimed he would honour all contracts prior to the election but hasn’t would then pull a fast one on the nation.
The Ziggy-Telstra Conundrum
Before I start with the new Statement of Expectations, I thought I’d look at some of the statements Ziggy Switkowski made on The Business recently.
Ziggy, with the smug look he usually has while being interviewed, spewed platitudes straight from the Turnbull Book of Talking Points. Claiming that the Multi-Technology Mix (MTM) is the “preferred way forward” worldwide. Do tell us Ziggy how buying rotten copper is the baseline standard for rollouts worldwide.
I have yet to see a single country go down this path, the reason being is that incumbents are refusing to upgrade their technology until there’s carrier level competition in an area. Does this sound familiar to anyone? Oh, maybe like in the US where as soon as Google announces an upgrade area AT&T or Verizon rush to deploy Fibre to the Premises (FTTP). Not some MTM joke of a rollout, but fibre all the way.
Not only this, “cable” (Pay TV) companies are reconsidering their options when it comes to deployments. With DOCSIS 3.1 still many years off, and Pay TV providers seeing big competition from the likes of Netflix, Hulu, and Amazon Prime, the last thing they want to do is invest in costly upgrades to aging infrastructure.
In New Zealand, Vodafone tried to get their HFC into the mix, but the New Zealand government wasn’t having a bar of it. Why? Well, Communications Minister Amy Adams summed it up nicely stating Vodafone was “obviously pursuing its own commercial interests”, which rings true with the NBN. Ziggy et al are pursuing the commercial interests of their former employer, Telstra.
This leads us to the next revelation: Ziggy Switkowski, in no uncertain terms, has stated that NBN Co would be buying Telstra’s copper network and maintaining the copper on their own back.
Yes, Ziggy has locked NBN Co into buying a (at least) $30b copper network that the technicians and engineers who maintain and design the network have stated is in a highly degraded state.
In any normal business this would be seen as idiotic without the close ties between Telstra, the executives of NBN Co, and the Minister for Communications. With such connections it is definitely a conflict of interest, verging on wholesale corruption. How can anyone justify handing $30 billion or more for a network that’s falling apart?
It’s like spending $5 000 on a Intel Pentium Pro 200Mhz computer because your mate already had one, instead of paying $1000 for an Intel i7 computer. I can make analogies like this all day, and they all ring true.
The key problem with all of Malcolm Turnbull and Ziggy Switkowski’s arguments is they are only relevant for incumbent telcos. NBN Co is NOT an incumbent, Telstra is.
The Bleating Stops
From the moment Senator Conroy ordered NBN Co to start the build Malcolm Turnbull has bleated like a wounded goat about the need for transparency, oversight, and most of all, a cost-benefit analysis (CBA) of the NBN.
Not only that, he was adamant that no changes would be made to the rollout until all his little reviews were finished. In fact, the Vandal of Vaucluse was so incensed by the suggestion by Senator Conroy that there would be no CBA that he was moved to write a blog post on 14/10/13 stating:
But then, with that uncharacteristic exercise in contrition off his chest, he launched into another homework-free, fact-free attack on the Coalition claiming that we had abandoned our commitment to a cost benefit analysis of the NBN project.
Nothing could be further from the truth.
As stated in our Broadband Policy (page 13) released in April 2013, the Coalition will conduct an independent cost benefit analysis of the project and a review of the regulations relating to broadband.
Those are strong words, strong enough to be taken as a guarantee by the Minister that a cost-benefit analysis was vital to the process of changing the NBN.
Before I continue I will state this: I think CBAs are a waste of time and money with such a large infrastructure project. While there should be checks and balances, the overarching theme should be: deliver the best possible service to the most amount of people.
The ramifications for degrading the NBN at this stage will be long lasting, and whether you run a CBA or not, there is no justification for hamstringing future development in the ICT sector.
That said, I am confused by the rampant hypocrisy that Lord Buffering of Wentworth has conducted with regard to the NBN. In the new “Statement of Expectations” (SoE), lovingly addressed to “Ziggy” in what appears to be permanent marker, it’s clear the CBA is meaningless to Turnbull and there was NO intention of even paying attention to what it contains.
No matter how Turnbull spins this, he has broken multiple promises on transparency, funding, speeds, and now process, in the NBN. From the initial statements post-election, there has been nary a sentence uttered from Mal’s lips that doesn’t include a high degree of misinformation, obfuscation, or outright lies.
The SoE clearly spells out the death of the NBN, locking in Hybrid Fibre-Coax (HFC), using data from the highly flawed MyBroadband website (which neatly debunked), and worst of all capping government funding at $29.5 billion, with the rest coming from “private investment”. I have to question any person investing in a company stupid enough to purchase outdated infrastructure, it would be like Macquarie Telecom investing in VAX/VMS servers for the “next generation datacentre”, just wouldn’t happen.
Ignorance Is Bullshit
It’s clear that even without Mal’s precious reviews, he has tried to sneak this one through, and fortunately for him, most of Australia’s journalists are stuck in a huge circle jerk over Bob Carr’s diaries, MH370′s disappearance (STILL!), or a starlet’s death.
This does not bode well for us; the most important piece of infrastructure Australia has ever seen is suffering a death by one thousand lies, and our fourth estate is sitting on their hands. Either they don’t understand it, don’t care, or are that ignorant they are willing to throw out the baby with the bathwater.
To me, this is gross negligence, there needs to be examination of what’s happening here, and maybe a comparison with what has happened elsewhere. Even the Openreach rollout in the UK is seeing increasingly more FTTP deployed over the planned Fibre to the Cabinet (FTTC, essentially UK term for FTTN). Why? Users need the bandwidth.
For a while there, with ADSL2, we were essentially “over serviced”. Web sites were small, downloads were small, we could live with this. These days we are vacuuming up data like a turbo powered street sweeper.
ABS data from this week shows clearly that we’re increasing data use at an exponential rate, since 2009 we have seen an 8.7x increase in data use. Over the next 5 years that will be closer to 32x current data use. In the last 3 months we’ve increased our data use by 30%, hinting to a doubling of data use in less than 12 months. This should be a scary prospect for anyone investing in infrastructure, not so with Turnbull who emphatically stated on 18/11/13 that data use growth had slowed:
Today, in contrast, we see that the most recent VNI, which was released in June 2013, forecasts a growth rate for total consumer use of data over the five years from 2012 to 2017 of just 23 per cent. Rather than data volumes doubling every two years, now they are doubling every four years.
Really, because CISCO’s VNI tool (have a play yourself) clearly shows this is NOT the case as exponential growth is expected. This lines up with ABS’s observations over the past few years:
With this in mind, investing in technologies that can barely break the 100Mbps mark under perfect conditions is folly, even if 25Mbps is “good enough” for today, within the next 5 years, the lifetime of the MTM rollout, we would need 800Mbps connections. This has not been considered at all by the Strategic Review, in fact, there are no plans to get even close to 800Mbps until, at the earliest, 2030, by then we’ll need much much quicker connections.
Don’t forget, data use is not all about download movies and porn, website sizes increase over time too, just ask Malcolm and his 3.2MB website. While the rate of website size increase lags data use increases, as is expected with changes in the ways we communicate, entertain, etc, website sizes are getting up there. Many of the websites I frequent are 5MB+ in size.
Hammer That Nail
I suppose this is the end for the NBN. With hard caps being put on funding and expensive infrastructure to buy, I’m concerned that the white elephant that Malcolm Turnbull banged on about for the past 3 years will come to fruition, not through ambitious plans, but through lies, deceit, and most of all, hypocrisy.
There is no logic or rational explanation for the decisions of Turnbull, and one could look back at his life before becoming Communication’s minister as to how he can live with himself doing this. Remember, lying to voters and screwing them over is ok so long as you and your mates get ahead.
The NBN is dead, and the wholesale destruction of the network will not be easily reversed. With the government being anything from $20 billion to $30 billion in the hole buying outdated twisted pair copper and coaxial cable networks, there’s little chance that sweeping the current government out will “fix” this.
NB: I will be writing another article addressing Turnbull’s ridiculous speech at CommsDay shortly, that needs a whole article of its own.
Also, I managed to fix the comment system. Give it a whirl.