With the resignation of the NBN Co board en masse landing squarely at the feet of Malcolm Turnbull, there’s an air of disarray in the new government’s communications portfolio. Having assumed the role of Minister for Communications just days ago, Turnbull has been swift to exact revenge on the NBN Co board for what he sees as “cost blowouts & long delays”. So, in other words: bullshit.
Turnbull has persisted with this cost blowout lie (yes, it’s a lie, no other way to describe it) for years now. Offering no evidence & using the tried & true “trust me” line. NBN Co has been so effective to date that NONE of the $3b contingency fund has been touched, not a cent. Any increases in cost are being offset by the increased ARPU from a 30%+ uptake of 100Mbps plans.
So why did Turnbull demand the whole board resign? Basically Turnbull is setting up NBN Co to fail. I’ve written on this previously, & now I’m as sure as ever that Turnbull’s intention is to destroy the NBN, even now they are in office. This is the first step in many that will ultimately end in Telstra purchasing the NBN for below cost price.
What strikes me as odd is that Turnbull still insists that he will build the NBN, while simultaneously doing all he can to destroy the network. Demanding a board resigns is far from the smartest move, & if anything will create disquiet in the company.
This becomes a very real problem when we consider the very real possibility of a failure cascade within NBN Co, a common occurrence in social groups, particularly in the computer gaming world. When your leadership team resigns the vacuum left behind causes an increase in resignations lower down, once this reaches critical mass it’s game over.
The key is, if Turnbull was fair dinkum he’d be both honest with the Australian public & run the NBN as he claimed he would prior to the election. That is: directing NBN Co to complete a task, how they do it is up to them.
It’s concerning that Turnbull is set to install the man responsible for destroying the culture of “fix it once, fix it right” within Telstra, Ziggy Switkowski. While Ziggy is a smart man, I have no doubt of that, I have to judge him on what he did to Telstra. Not only did he help tank the share price from the T2 $7.40 down to the (when I worked there) $3.50 mark, his views on how to service such a large nation were conflicted at best.
On the one hand, Switkowski & his executive team knew that copper was “end of life”, with Tony Warren stating to a Senate Committee inquiry into broadband competition:
I think it is right to suggest that ADSL is an interim technology. It is probably the last sweating, if you like, of the old copper network assets. In copper years, if you like, we are at a sort of transition – we are at five minutes to midnight.
With Bill Scales clarifying that this meant “10 to 15 years“.
Quite a positive outlook, until you realise the reason why our network is in such a bad state is because of the culture that was born from privatisation of Telstra, mainly under the guidance of Switkowski.
New KPIs were brought in, the workforce was contracted out, & all the “old knowledge” offered redundancy (before being given forced redundancy). Essentially the knowledge base was gutted, & cost cutting applied across the business.
This is not to say I instantly assume that Switkowski will do a terrible job at NBN Co, but it’s definitely not looking good, especially in light of Turnbull gutting the board. He will have a hard time turning this ship around at the best of times, without a solid executive team behind him, Switkowski has no hope.
Maybe this is a veiled attempt to default to FTTP for the rollout: we can’t turn the ship around, let’s just stoke the boiler instead!
Whatever the outcome of this week’s news, it’s clear that there are competitors waiting in the wings, ready to cherry-pick the most profitable parts of the country.
With TPG announcing plans to build a FTTB (Fibre To The Basement) network, utilising their own PIPE infrastructure, & Telstra announcing trials of FTTN had started within days of the election, we can see the market for highly profitable inner city broadband is getting crowded. This doesn’t leave much room for a government built network, especially when you consider Turnbull & his policy decry overbuilding of “economically viable infrastructure”.
On a side note, BT area already finding FTTN to not be enough & are looking at FTTdp (Fibre To The Distribution Point) to get cable lengths even shorter. This is all in the name of ‘saving on costs’, but even they admit end-game is FTTP.
As the days tick by we’re seeing it become more apparent that Turnbull can’t change to FTTN as quickly as he hoped, he can’t just fudge the numbers on the reviews, & he can’t ignore the voice of the many demanding he stay with FTTP.
With a non-existent board, & an incoming CEO who is a wildcard at best, it’s hard to remain positive about the NBN. I fear we are going to see an opportunity to build for the future slip the country by, again, due to conservatives & their ideological crusades.