Australian Labor must make the NBN an election priority

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Labor must make the NBN an election priority and in doing so position itself as the champion of consumers desperate for a better online experience, and as builders of infrastructure vital for jobs, education and Australia’s future in the global digital economy.

The Coalition appear to have parked planning for the future of the nation’s participation in the digital economy. After six years of this policy vacuum, if the Coalition government is not going to commit to upgrading the NBN to an all fibre network to 93 per cent of premises, Labor should pick up the mantle.

Among the world’s 68 leading economies, Australia has slipped to 14th in the Global Digital Competitiveness Ranking 2019. Australia ranked 45th for business agility, three places lower than 2018 and for broadband Australia ranks 38th.

This acceptance of a dismal future for younger generations seeking to gain a foothold in the global digital economy must not be permitted to continue.
The nation needs strong leadership that commits to becoming a leader in the global digital economy.

A commitment by Labor to finish the NBN following its original plan won’t come cheap, to replace the copper-based technologies will cost about $10 billion to 12 billion and take about five years.

Not much has been said by business and industry leaders about the cost blowouts and delays that have occurred for the Coalition’s inferior NBN. But every Australian understands that the weak excuses of successive Communication ministers, over the past six years, amount to an admission of failure.

There is also a need for a third SkyMuster satellite to meet demand and for more fibre to be rolled out into regional and remote areas.

Labor’s platform at the last election did not place the NBN as a centrepiece, and it is time for a rethink for the opposition. The NBN is a good news story, it is about future employment, education and health delivery and the nation’s participation in the global digital economy in decades to come.

The NBN crosses the political divide, and just as many right leaning voters as left leaning are stunned by the lack of performance and reliability of the NBN built under this government. The Coalition’s NBN has been a waste of $30 billion and set this country back a decade.

Like the Murray Darling fiasco, it is time to call out this national infrastructure disaster. What is the Coalition plan for the future of the NBN?
NBN Co’s recent attempt to mislead the Australian public on the true nature of the NBN and its detrimental effect on Australia’s broadband ranking compared with the rest of the world should be condemned.

I am not going to refer directly to the report commissioned by NBN Co because I don’t want to give this nonsense any additional oxygen.

Why would government have agreed to the publication of this report? Do they really think we are that gullible that we would believe the kinds of nonsense that has been put forward by government through its many reviews, audits and attempts to redefine globally accepted terminology?

It took journalists all of one minutes to spot the trickery in the report and it has justifiably been ridiculed.

This is the third time in the past six years that the government, the Communications department and NBN Co have attempted to hide what is actually happening, whilst spruiking the fantasy that all is well with the NBN.

The Communications Minister Paul Fletcher’s speech at the Committee for Economic Development of Australia’s (CEDA) 40th State of the Nation on the NBN and productivity was light on substance and provided no guidance on plans for the NBN beyond completing the rollout in “2020”.

Upon reading the speech, I was struck by how you could be confused by Mr Fletcher’s message and come to believe he was actually justifying an all fibre NBN. All of the statistics provided indicate that if we had stuck with an all fibre NBN, the economic outcome would have been even more impressive.

Mr Fletcher has been in the portfolio for some time now, so it can be assumed that he is fully briefed and has commenced the planning for the NBN in the period after it is built and fully operational. This is likely to be in 2022 in the lead-up to the next scheduled federal election.

The lack of forward planning and public debate around the future of the NBN is damning of a government that claims that it has a comprehensive plan for Australia’s participation in the digital economy.

The foundation of Australia’s participation in the global digital economy is infrastructure and the NBN forms a vital part of this infrastructure.
What is the current state of the NBN?

The NBN is now likely to cost about $51 billion and not be built and fully operational until 2022.

NBN Co is likely to be $21.4 billion over budget and four years behind the Government’s promised delivery date by 2022 when the NBN is expected to be built and fully operational.

NBN Co’s annual financial report for 2019 indicates that NBN Co has assets worth $32.7 billion, however the effective value of the assets is about $24 billion when the true value of the copper assets is taken into account.

NBN Co owes Telstra about $1 billion annually, or about $14 billion using net present value, for infrastructure leases. This infrastructure leasing cost will increase over time.

NBN Co needs to find $10 billion to $12 billion to replace or “upgrade” the copper-based technologies to fibre. Have no doubt that this is necessary and should be done sooner rather than later. Delay will detrimentally affect Australia’s economic competitiveness.

NBN Co also needs to commit $600 million to a next generation satellite to supplement the SkyMuster satellites and to prepare for their decommissioning in the late 2020s.

In August, NBN Co announced that it would commit $4 billion over the next four years to providing network upgrades, however this vague statement could mean that NBN Co intends to use the funds for business connections and to complete the network roll-out.

Between 2015 and 2019 the average revenue per user has increased from $40 to $46 per month, still a long way from the $52 per month that NBN Co needs to achieve before it is able to balance the books and begin paying back debt.

NBN Co is now focused on delivering enterprise broadband products to make up revenue shortfalls that have occurred due to the Coalition decision to roll-out second rate obsolete copper-based technology.

Why Labor should promote the NBN to the party’s election platform.
You don’t have to read anything other than Mr Fletcher’s CEDA speech to understand why the NBN is vital for this nation’s future.

What is remarkable is that having delivered this speech, Mr Fletcher and his colleagues fail to grasp how the NBN underpins whether or not Australia will succeed in the digital economy.

The nation needs leadership. The NBN is a perfect example of a vital infrastructure project that started out with initiative and forethought, but was brought down due to the ugly nature of Australian politics.

Will Labor learn the lesson provided by what is happening globally and take the important step to reinstate the NBN as a centrepiece of its vision for Australia’s future?

In my view, Labor must take the initiative and deliver on this very important national infrastructure project. Australian’s were disappointed at the last election that Labor did not promise to fix the Coalition’s mess and deliver on the original vision for the NBN.

Mark Gregory is an Associate Professor in Network Engineering at RMIT University and is the Managing Editor of the Journal of Telecommunications and the Digital Economy