April 2009 would go down in history as the date former Australian Prime Minister Kevin Rudd unveiled his social democrat Labor administration’s ambitious undertaking: Deliver broadband Internet to every single Australian. The project was named the National Broadband Network (NBN). Its objective was to bring high fiber optic technology to the various homes, schools and offices of approximately 93% of the Australian population.
The balance of 7% comprise those who reside in areas that are out of reach of fiber optic technology; mostly in rural areas and sections located in the middle of Australia, which is one of the most sparsely populated countries in the world. The NBN would connect them to the Internet via the latest wireless and satellite technology.
Australia’s landmass is comparable to the United States. However, the continent has about the same number of people as the state of Texas. Countries such as Japan, New Zealand and Singapore were able to carry out aggressive fiber-to-the-premises (FTTP) networks because they were smaller and more compact than Australia.
The NBN project would entail massive manpower, precise logistical planning and top level engineering to navigate existing rights-of-way, utility poles and underground ducts. In 2013, it was estimated that the cost of the NBN project was US$44.1 Billion; the most expensive FTTP rollout to be executed by the government.
But the benefits of the NBN project would outweigh the costs. An interconnected Australia would help create more efficient delivery of technological innovations in healthcare and education, expand the coverage of e-commerce and improve the standard of living for Australians everywhere.
The NBN would conceivably increase job creation and enhance productivity by introducing more efficient means of managing businesses. A study by Deloitte Access Economics quantified the benefits of NBN at US$3,600 per Australian household.
In terms of cost-side economics, despite its huge funding requirement, the cost of maintaining and upgrading fiber optic technology is manageable.
However partisan politics dictates one must always oppose a solution. The NBN project became a point of contentious debate in the campaign leading to the September 2013 elections. Despite surveys showing overwhelming support for the NBN Australians rejected the Labour party and voted an alliance known as the Coalition into power.
With its leader and newly installed Prime Minister Tony Abbott at the helm of government, the fate of the NBN project took a drastic turn. In a clear case of “penny wise, pound foolish”, Abbott decided to open up, dissect the NBN to streamline its costs by cutting down on infrastructure spending and scaling back its coverage.
Abbott believed demand for NBN was not significant and therefore, did not merit the huge budget.
At the time of the elections some 210,000 out of 13.2 million premises were already connected. Abbott wanted fiber optic connectivity limited to new housing developments while for existing homes and establishments; roughly 71% of the population, the government would only install fiber up to curbside cabinets or nodes. This process is otherwise known as fiber-to-the-node or FTTN. The remaining mile would be connected to households via existing copper wire pairs.
Abbott’s FTTN strategy provided a band-aid solution to Australia’s connectivity woes. It offered a short-term solution to reduce the cost of the NBN but failed miserably to factor in the long-term benefits in terms of convenience, effectiveness, data streaming speed, maintenance and upgrades.
Sources: NBN Co; Coalition’s NBN policy statements; “Energy Consumption in Access Networks,” J. Baliga, R.S. Tucker, et al., Optical Fiber Communication/National Fiber Optic Engineers Conference, 2008
Copper as a material does not have the components to support the expected growth in data consumption long predicted by analysts. A recent study by ZenithOptiMedia showed people now spend 70% of their Internet time on mobile phones and that online activity would increase by 30% in 2017.
With copper as the “band aid”, over time, Australia would have to replace FTTN to FTTP. However by then, the upgrade would result to a more expensive undertaking than the original budget proposed in 2013.
In terms of speed, the original NBN proposal committed 100 Mbit/s up to 1 Gbit/s. Under the Abbott administration, this was downgraded to a maximum of 25 Mbit/s.
Presently, under the administration of Prime Minister Malcolm Turnbull, the 2017 NBN project combines wired communication, copper, optical and hybrid fiber-coaxial, radio communication, satellite and fixed wireless networks at 121 Points of Interconnect (POI).
These are located in telephone exchanges that are owned by Telstra and situated throughout Australia.
Turnbull was the Shadow Minister for Communications and Broadband during the time of Abbott. In 2010, Turnbull shared his opinion that 12mbps was enough for every Australian.
The NBN continues to maintain its position that there is no demand for services above 25 Mbit/s despite surveys to the contrary.
However, NBN CEO Bill Morrow admitted that 15% of end users are “seriously dissatisfied” with the services. In addition a 2017 report by the Joint Standing Committee on the National Broadband Network identified significant issues on the technological framework utilised by the NBN.
Perhaps in an attempt to pre-empt a broadcast of a documentary narrating the failure of the NBN, Turbull publicly admitted the NBN was a failure but passed the blame to the Rudd and Gillard governments.
The NBN was an ambitious project that was essentially demolished by politicians who knew very little or were grossly informed on the advances of fiber optic technology yet chose to ignore the demands of the very constituents that brought them to power.
As Turnbull continues to grapple with the harsh realities of government’s failures to keep Australia at par with the connectivity achievements of his counterparts at Japan and South Korea, he may find himself in the company of nations notorious for poor Internet service like North Korea.
In North Korea, only government officials, their families, students from elite universities and members of the Cyber Warfare team have access to the Internet. A study by GitHub showed that you can only access 28 websites in North Korea. Its average bandwidth is only 3.4 Mbit/s.
Unless the Australian government wakes up and sets aside political interests for the good of the people, the continent may end up falling behind the rest of the world.