NBN BUZZ: Conroy's heavyweight backup

Communications minister Stephen Conroy hits back at Malcolm Turnbull's recent comments, Malaysia wears the NBN crown, and spreading the NBN telework message.

NBN Buzz is a weekly wrap up of everything that's going on with Australia's largest infrastructure project. For previous editions and the latest news visit our NBN Buzz page.

Conroy's NBN backup 

It hasn’t taken long for Stephen Conroy to hit back at the latest speech from Malcolm Turnbull, with the communications minister reportedly taking particular exception to the assertion that the NBN won’t be a ‘game changer when it comes to innovation.

As mentioned in yesterday’s article, Turnbull’s reasoning is that if an "apparently broadband-deficient" US can be home to Google, Facebook, Amazon then perhaps we are better off ditching Labor’s NBN and rely on the mix of technologies that the Coalition has in store.

Thirdly, in completing the upgrade of broadband services across Australia, we will be technologically agnostic – there will continue to be FTTP, but also FTTN and, if it can be satisfactorily negotiated, wholesale access to existing HFC networks. Our focus will be on a service quality outcome – not a particular technology. 

With this approach we are satisfied that we can complete the construction of a national broadband network faster, because a mix of technologies will upgrade services sooner than near universal FTTP, at less cost to the taxpayer and more affordably for end users, because the combination of a less expensive network and the return of competition will put downward pressure on prices.”

Now, some may see this as a patchwork solution but there is no doubt that such a service would be rolled out a lot quicker. The only catch is that we haven’t seen a business model of how this will be achieved and as respected analyst Paul Budde points out in a recent report the Coalition’s so- called cheaper NBN could “cost Australia significantly more in the future.”

Back to Conroy’s retort, bringing up Google and Facebook was always going to backfire on Turnbull because as far as online innovators are concerned they can’t speak highly enough about the NBN.

As the report in The Australian highlights, Conroy has gleefully pointed out that Google’s Eric Schmidt is a big fan of the NBN and the fact that Australia is taking a leadership role here.

"Eric Schmidt, the executive chairman of Google, says: 'Australia is leading the world in understanding the importance of fibre. This is leadership which I think is wonderful'.

"Mr Schmidt also argues that, 'in terms of investment from government funds, investing in the national broadband infrastructure at this level is probably the highest-leverage investment that the country can make because it touches so many aspects of the society'."

In fact, it’s not just the tech heavyweights that are singing this tune, analysts are quick to extoll the virtues of the network and local businesses, including the telcos, are starting to realise its potential.

Malaysia rules the NBN roost

Another feature of Turnbull’s speech was his recognition of the Malaysian NBN experience as an example that could be pursued by the Coalition, stating that the High Speed Broadband (HSBB) network – a 70/30 joint-venture between Telekom Malaysia and the government – was a good example of building a network quickly. 

His statement  was buoyed by the latest research by Informa Telecoms & Media which showed that Malaysia is comfortably outpacing other NBNs being deployed including in the region, not just ours, but also the ones in Singapore’s and New Zealand.

According to Informa, the HSBB had 310,000 subscribers by end-April and had passed over 1.2 million premises in the country. The bottom line is that the network set to be completed both on time and under budget. As Informa senior analyst Tony Brown points out the HSBB deployment has gone so well in Malaysia that there is now talk of extending the network beyond its original target of 20 per cent of the total homes in the country.

“There is no doubt that Malaysia’s decision to stick with the incumbent, Telekom Malaysia, in deploying its next-generation broadband networks is definitely bearing fruit at the moment,” says Brown.

However,  he also points out that choosing not to deploy a more complex NBN model, through the creation an independent wholesale network access operator,  could be a negative in the long run. In addition, Brown says that another problem facing the Malaysian NBN market surrounds content, especially the tight exclusive grip that pay-TV giant Astro has on much of the best TV programming.

“With video set to play such a huge role in the broadband market and with so many operators now launching IPTV services – including both Telekom Malaysia and Maxis – content rights are becoming ever more critical,” says Brown.

Spreading the telework message

The political jousting wasn’t the sole feature of the NBN debate this week with a further 61 organisations across Australia, including Westpac, IBM and Research in Motion, signing up to promote telework in their local operations.

The latest additions bumps up the overall partners list up from 15 to 76 organisations and Conroy said that the significant increase reflects strong employer interest in the expected benefits of the NBN for the telework experience.

“The NBN allows employees to work in high-definition interactive environments from wherever they are, be it at home or elsewhere. This increases workplace productivity and can reduce the need for long daily commutes to the office. This will make a big difference to people’s work-life balance.”

Other companies signing on for teleworking include Telstra, Cisco and iiNet. The government is partnering with the Australian Information Industry Association and the Australian Services Roundtable to provide a series of telework seminars to spruik the telework message.

The seminars will be held in major capital cities and regional centres as follows: Adelaide, Perth, and Mandurah in June; Melbourne, Bendigo, and Mt Gambier in July; Brisbane, Gold Coast, and Canberra in August; and Sydney and Newcastle in September.

Jobs and fibre

Meanwhile, the communications minister was also busy launching the brand spanking new cable manufacturing facility in Victoria. The facility, owned by NBN supplier Corning Cable Systems, will supply optical fibre for the network. Corning has committed to spend more than $40 million on the operations and is likely to hire up to 400 more workers when the NBN rollout hits its peak.

Speaking of jobs, NBN Co is reportedly expects to create a dozen new jobs in Adelaide by the end of the year. According to The Adelaide Advertiser  the jobs will come thanks to the launch of two new high-speed connection hubs (PoI), which will be located at Lonsdale and the industrial suburb of Green Fields in Adelaide's north.

Elsewhere, the New South Welsh coastal towns of Coffs Harbour, Taree, and Port Macquarie are gearing up to connect to the NBN. Around 15,000 homes will be switched on to the network using the NBN's fixed wireless, with the rollout due to be fully completed in 2015.

Not all smooth sailing 

However, it wasn’t all smooth sailing for the government with some embarrassment in Tasmania, after the state’s peak business group reportedly admitted that it had repaid $130,000 to taxpayers after misusing part of a grant designed to improve the uptake of the NBN.

According to The Australian, the Tasmanian Chamber of Commerce and Industry was given $250,000 from a $1 million state program to help business take full advantage of the NBN. However, an internal audit has revealed that $130,000 of the money was spent on other things.

Meanwhile, the NBN battery issue made another appearance with The Australian taking aim at the government’s insistence to install back-up batteries that are redundant for most households.

NBN Co has already installed thousands of batteries that are designed to keep old-style analog phones working during power blackouts. However, they are useless to modern telephony equipment. The back-up batteries, which cost $30 and need to be replaced every five years, have reportedly ticked off quite a few people and the government is now consulting with community groups, including emergency services, to find a solution.

Finally, the government’s plans to spend $20 million to ram hom the NBN message, as outlined in the budget, has been panned by Nationals MP Luke Hartsuyker , who has labelled the entire exercise “a propaganda campaign.”

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