Final nail in Labor's NBN coffin

Australia’s NBN is going to be a multi-technology affair, as was always the stipulated goal of the Coalition government, but it does make one wonder what the fuss with all the audits and reviews was all about.

The federal government’s decision to effectively lock NBN Co into pursuing the rollout using a mix of fibre-to-the-node (FTTN), fibre-to-the-premises (FTTP) and hybrid fibre coaxial (HFC) technology puts the final nail in the coffin for Labor’s full-fibre initiative.

Realistically, that option was taken of the table last year but the subsequent months have been one steeped in inertia and uncertainty both for NBN Co and the telco sector.

The decision to hand down the final instructions to NBN Co without the benefit of a cost-benefit analysis looks to have been dictated by the desire to fill this policy vacuum.

Perhaps Communications minister Malcolm Turnbull has had enough of kicking the can down the road and putting off making any decisions until the Vertigan Committee review had handed down its recommendation.

Following Conroy's footsteps?

The telco industry and NBN Co, which to a great extent has been flying in the dark for most of this year, will certainly welcome Turnbull’s resolve to get things going but it does leave the minister open to some strident criticism from the critics.

After crowing about the lack of a cost benefit analysis on Labor’s plan, Turnbull has decided to follow his predecessor Stephen Conroy’s footsteps and hand down a prescriptive blue print to NBN, with a few critical pieces of the puzzle still left unsolved.

The immediate one is about the fate of TPG Telecom’s proposed fibre to the basement network, which will need to be resolved before the bigger issue of getting access to Telstra’s copper is tackled.

Both hold grave implications for NBN Co’s economic viability and just what happens with Telstra’s copper will be instrumental in whether NBN Co can get the job of rolling out a network on time and within the $41 billion budget.

As Turnbull puts it the decision to pre-empt the Vertigan review had clearly been made to allow NBN Co to get on with the job and there is the necessary flexibility to modify the statement down the track.

Rubber stamping the MTM

But has the Coalition subverted the usefulness of the reviews by setting the MTM approach in stone? Or does the minister feel he has the information needed to confidently push ahead with the mix?

Perhaps too much faith is being put in the Vertigan Committee review in the first place. We have assumed that the review process has been implemented to provide a forensic analysis of what road to follow with the NBN, but perhaps the real intent has been to rubber stamp the MTM mix all along.

The Coalition’s decision on Wednesday would indicate that the NBN Co strategic review, derided by the parliamentary committee probing the NBN, provides just about everything NBN Co needs to know to get started.

So what happens now? Presumably, NBN Co now has the green light to pursue the magic mix of technologies but it’s hard to see how it can really get some runs on the board until it gets access to Telstra copper.

However, the statement of expectations does put a formal plan in motion, and that’s something at least.

The Vertigan committee is set to expedite the release its recommendation on whether TPG should be allowed to exploit the current loophole in the legislation and in a way by Turnbull may have at least set the scene for taking care of the TPG problem one way or another.

As for the committee, it still has a job to do and its recommendations may still play a key part in how the Telstra deal pans out, and what happens once a FTTN network is finally on the ground.