back to article Yet another business advisor told Labor NBN was a dud: reports

Another shot has been fired in an election campaign that has so far continued more than sixty days beyond the conclusion of the ballot, with Australia's new communications minister Malcolm Turnbull calling on the former government to publish a report it received in 2010. The basis of the demand is a leak via News Limited, which …

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WTF?

A rational explanation

1. That Telstra would have the “option to compete with the NBN” while receiving funds from it.

The NBNCo Corporate Plan (2013) states that in April 2013, 47% of fibre connections were 12Mbps. The fact it costs only $5 extra a month for 25Mbps, suggests to me that the 47% either don't care about their network or want the cheapest connection possible. If we assume that the vast majority of these people have a smartphone or will within the next five years, then I would argue that a reasonable number of these customers could be poached by the mobile network operators on the basis of price, especially when for a reaonable number 4G will be faster.

2. That “projected customer take-up and average return per user were likely to be proven optimistic in such a competitive industry”.

NBNCo is based on the assumption that they can drive ARPU from just over $20 to well over $100/month as demand rises. This may prove challenging. The high connection charges (AVC) will present a barrier.

3. “Lazard … pointed to anecdotal evidence that 20 per cent of premises could ultimately be wireless-only.”

The NBNCo Corporate Plan estimates 16% of premises will be wireless only because it is cheaper, so 20% is not unrealistic. NBNCo are estimating that only 70% of premises will connect for a variety of reasons.

If you are considering replying that mobile wireless is not adequate for internet, please note that I agree with you, but then I would select the 100Mbps plan not the 12Mbps plan. To understand if wireless is adequate or not you first need to explain why 47% would select 12Mbps when for $5 extra they could have 25Mbps.

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Bronze badge

Re: A rational explanation

"To understand if wireless is adequate or not you first need to explain why 47% would select 12Mbps when for $5 extra they could have 25Mbps."

First of all, this means that 53% chose a higher speed - I'll point that out since it always seem to escape those who plug that "47%" number.

Second - I worked in an IT position that put me in contact with John and Jane Citizen on a regular basis (luckily, I got promoted away from it). The average Australian doesn't understand the concept of the Internet. To them it's plugging a box to the wall and having their web-sites downloading. I'll point out that my Mother fits in that category. Most of them have problems understanding how streaming, or even (gasp) video on demand works. If they have come across video on demand it's from Foxtel where said videos are pre-downloaded onto the STB.

So the answer to your question "why do 47% choose the lower, cheaper option" is: because they don't know better and the companies currently in control don't want them to learn.

Can you imagine what would happen to Foxtel if people could get IPTV whenever they felt like it? Oh, and Foxtel is owned by Murdoch, whose press arm is constantly telling us how bad the NBN is. Wonder why.

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Facepalm

Re: A rational explanation

Some of the 16% vs 20% vs 30% wireless in cabled areas will be the result of the difficulty in getting them physically hooked up. There are a large number of properties such as my own that were not properly connected to utilities when they were subdivided. My current phone line is direct bury and goes through the yard of the house in the front. There is no way to get to the Telstra pit without going under the driveway which is shared property or through someone else's yard. There is no place to put a pole either so I'm sure I'll be on the wireless plan. My house is typical of most of the near by lots that were subdivided 15 or more years ago.

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Re: A rational explanation

> First of all, this means that 53% chose a higher speed - I'll point that out since it always seem to escape those who plug that "47%" number.

My expectation is that the 47% will rise (NBNCo shows it on a steep upslope) because we are still in the early adopter phase and I would expect those to connecting later to connect at slower speeds. It is the bottom half of society that governments should be responsible for, not entrenching discrimination. Secondly many of the remainder will either be able to move to an area with fibre (e.g. new estates), choose fibre on demand or will find FTTN adequate.

> So the answer to your question "why do 47% choose the lower, cheaper option" is: because they don't know better and the companies currently in control don't want them to learn.

I'm not sure I agree with your conspiracy theory, but your point neatly sums up why speed tiers are so very bad. If speed was uncapped then peope could experience the benefits of fibre and increase their data allowance. With 12Mbps, streaming will always be poor.

It was only after Telstra refused to tender for FTTN, that Labor chose FTTP and though poor judgement in writing the "Statement of Expectations" meant that NBNCo constructed an artificial financial model which would have delivered very little benefit to Australia.

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I think Google style "active ethernet to the pole", with optional FTTH (with customer paying full on premises cost up front) for those who want it, and picocells for the oldies would solve the problem. Why blow $3,000 + financing costs per premises if fiber is not being used?

Also, could they hurry the frack up and deploy it. 2021 is way too long to rot on DOCSIS 2.0 now that Optus have stopped investing in their network.

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Good to see that

the previous government disregarded this shite.

That being said, if the report had been available before the election both the Liberals and their NewsCorp master would have been loudly proclaiming this report as "proof" the NBN was a dud.

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