cc coalitions plan for fast broadband and an affordable nbn

7/28/2019 CC Coalitions Plan for Fast Broadband and an Affordable NBN

1/18

THE COALITIONS PLAN FOR

FAST BROADBAND AND

AN AFFORDABLE NBN

APRIL 2013


2/18The CoaliTions Plan for fasT BroadBand and an affordaBle nBn 2

1 Actual download rates in Australia average 4.3 megabits per second. Akamai Technologies, State of the Internet, Q3, 2012. Advertised download rates average 9 megabits per second across broadband

users according to the Australian Bureau of Statistics (using a weighted average of range midpoints). ABS 8153.0, Internet Activity, Australia, Jun 2012.

2 NBN Co, 2012-2015 Corporate Plan, p.69 and 72. Page 69 of NBNs Corporate Plan displays a graph showing a steep rise in the monthly ARPU (average revenue per user) NBN Co expects to collect.

NBN Cos financial projections on page 72 show wholesale charges per user increasing from $22/month in 2011-12 to $62/month in 2020-21.

The Coalition will deliver fast, affordable and reliable broadband to all Australians.

We will complete the National Broadband Network as quickly and cost-effectively

as possible, using a mix of technologies that will provide high speeds at areasonable cost.

Our goal is for every household and business to have access to broadband with

a download data rate of between 25 and 100 megabits per second by late 2016.

Downloads average less than five megabits per second at present.1

Suburbs, regions, towns and business districts with the poorest services and

greatest need for upgrades will receive first priority.

Key prices for a Coalition NBN will be capped nationally, ensuring Australians inmetropolitan and regional areas alike can obtain services at fair prices.

By contrast, under Labors NBN wholesale charges per user will triple by 2021.2

To put further downward pressure on prices, the Coalition will unshackle the

competitive telecom market that Labor tried to stamp out, and reduce the cost

of the NBN to prudent levels.

To ensure accountability we will require NBN Co (the government-controlled

company building the network) to release more information more often to thetaxpayers paying its bills.

We will resolve the greatest failure of current broadband policies: the up to two

million households and businesses across Australia that cannot get basic fixed

broadband after more than five years of Labor government.

Broadband infrastructure is necessary for our digital future, but on its own it is

not sufficient. Businesses, governments and communities must be creative and

energetic in finding areas where the NBN opens the way for new, better, less

costly or more convenient services and amenities. This will ensure the nationmakes the most of the economic opportunities provided by very fast broadband.



THE ISSUE

T Ct bv aut u v cc t t b bb. W cg

t bt tt t bb pv t u bu t vu (g wt t

mt cmmuct tcg) tg puctvty vt.

Broadband and the Internet are essential services

T itt pvv pc u cmy y v tm bb t t

vc.3 i 2012 u ut v aut g 14 y v u t itt t t mty, w

t ut v ( mt 11 m u) t my tm c y. 4

T uck t bt t gt cmy, cc t bb mut b uv, pp u

mt t vtg. Bb mut b b, t w cm t

cugt t wg gt v. at pt t t t c. Up t tw m aut

u bu t v qut x bb ty ct cc vc t t

w ub bc tk uc tmg t v wkg m m.5

Labors National Broadband Network is failing

Bt lb t Ct g tt uv, b t bb ctc t u utu.

But lb pv cpb vg t pcy bjctv tmy t b ct.

i ap 2007 Kv ru pm vt nt Bb ntwk uppt by $4.7 b pubc

ug t b cmpt 2013. fv y t lb pcy ucg m t t t xt. Btt

bb b pv t y u t mt pt $7.5 b cu t b

pv t nBn C by Ju 2013.6 T nBn b twk w vb t jut 72,600 pm u

t y 10,400 by dcmb 2012.7 Buty, nBn C gt vy g bcmk t t t.

lb nBn cg w wy t cc t c b cmpt t cut m by

lb 2021. it, u lb m aut wu b t wtg c m

btt bb. T pubc ug qu wu bw ut by nBn C cm $44 b

m tc y ct ug wu xc $90 b, t t bckgu pp

wt t pcy.

Pc, t t , t cg w ty p t c p bu.

U lb cut pc, w u cg p mt w, vg, c mt t- v t xt y tp t ctcty b v t pt y. ajut

t, u cg w m t ub.8

3 The share of Australian households with home Internet access increased from 67 per cent in 2007-08 to 79 per cent in 2010-11. AB S 8146.0: Household Use of Information Technology, Australia, 2010-11,

Dec 2011.

4 Roy Morgan data reports that in June 2012 14.3 million (77 per cent) of Australians aged 14+ accessed the Internet over the month, while 10.8 million (62 per cent) used it more than once per day.

Roy Morgan Single Source, June 2012, cited in the Australian Communications and Media Authority: ACMA 2011-12 Communications Report, p. 57.

5 McKinsey and KPMG for the Department of Broadband, Communications and the Digital Economy: Implementation Study for the National Broadband Network, March 2010, p. 190 and p. 282.

The Study identified 1.2 million pair gain or RIM lines where xDSL was unavailable and 0.4 million premises served by exchanges where xDSL equipment had not been installed. Many other households

and businesses can get ADSL in theory, but are too far from the exchange, have broadband limited by line-specific factors, or cant get service because of port or space constraints at the exchange.

6 Investment in NBN Co will reach $7.5 billion by June 2013 according to the Mid- Year Economic and Fiscal Outlook 2012-13, p. 285.

7 NBN Co, Media Release, 29 Jan 2013, Available: http://www.nbnco.com.au/about-us/media/media-releases.html?icid=pub:media::men:med-rel

8 NBN Co, 2012-2015 Corporate Plan, p. 69 and p. 72. Pages 69 and 72 of NBNs Corporate Plan show monthly ARPU (average revenue per user) rising from $22/month in 2011-12 to $62/month in 2020-21.



NBN Cos eroding credibility

it cgy bvu tt cm t nBn ut tck, tt txpy w cv tu

u vt, tt nBn C cmmcy vb t cut m t cb.

f m g t v p ct cm by lb, t vb mt uggt t nBn w v

ptv tu cmpt ccg t t cuty pp p.

T uvg nBn C cbty bg wt t v nBn C 2012-2015 Cpt P

augut 2012. W lb nBn C t t p t bm y Tt t aCCC, t w

cy m t t ty. T P cu mv v t ut vu tgt t

g nBn C 2011-2013 Cpt P jut 20 mt dcmb 2010:

NBN CO: Diminished expectations 2011-2013 Plan 2012-2015 Plan

Release Date Dec 2010 Aug 2012

Revenue (July 2010 to June 2013) $205 million $20 million -90%

ict oPeX (Juy 2010 t Ju 2013) $771 m $1480 m +92%

fb pm p (Ju 2013) 1,268,000 341,000 -73%

fb pm wt vc (Ju 2013) 511,000 54,000 -89%

Tkup w nBn vb (Ju 2013) 33% 14% -58%

All premises with service (June 2013) 566,000 92,000 -84%

i tut, t y w nBn C xc xpctt t t u y pt w t

ct xp t pg bt, cutt, wy, c pc, cpt

tv vtg. T ct v ctty b but twc muc gy ct

2013 m gv nBn C 2,300 t.

i Mc 2013, nBn C mtt tt v t tgt t v Cpt P w ut c.

By t m 2013, jut w mt b t xt f ct, t k tug nBn C w

v pt u y b ug b t but 50 t 12.2 m pm t

b w pm t c.

Does demand for bandwidth require switching to fibre?

it mut b t, wv, tt lb nBn w t p t uy bwt cuc. T

mpg bwt cuc , v lb pcy p tu ut t b qut.

i, v cm t mt t itt, m bwt ugg. Wt t wtcg

mv TV, bu cc c, skyp ct wt my b, tm ptg vt,

mc cutt, cp YuTub, v ttg t mt cut cct, pkg

cu v w t p.

i vty m bwt t qut tt ptc b t gtt cpcty.



But cum y t t t t y b c pv, typcy u ppct tt

uc bwt? a v ty , ty wg t py m t?

au t w t vc cum wg t py g cg 100 mgbt p

c mtm ppct t t tmg v tt ut uc bwt. accg

t rupt W ayy M: T c m vy g x- bwt

pmum t b p. Cum m wg t cu t tcm bugt mb vc vc. 9

rpcg cpp wt b tt u t vy pm, kw b t t pm, fTTP, vy

xpv: t tb w mt aut v, t ct v tu p m

bu. d t vtmt pt vu my txpy, t bt u cc uc?

This is really the crux of the broadband debate in Australia and elsewhere:

C g m bwt, ccmp by mt wg t py m, b mt

by vgg xtg tuctu mt vtmt t pu b ut t t

twk c t u? ;

h gcy tuctu uc Tt cpp twk c pt w t ub

t uppt t bwt by u mut b but v? i , w gg t py

t vy ty pc t?

Labors choice: The most expensive NBN in the world

i ap 2009, lb c t t bt. it cmmtt txpy t m mbtu cty

bb p t y t t w.10 nBn C w ct txpy-w mpy wt

mt t pc Tt cpp wt b ( cv cmptt pcy bjctv: t pt

Tt twk m t t bu).

T c w m t wt ccy y y ttv pt wt ttmpt t

mu t ct bt.

The Coalitions alternative: Choose the most cost-effective technology

Bb pcy u b but cty mtg cmmuty , t vctg ptcu

tcgy. ntwk u b upg t mt ct-ctv wy ug t bt-mtc tcgy.

T w vy m pc t pc. extg tuctu mt wy vt t py.

T t ppc pt vtuy vy t vc cmy, t ppc tt w bpt by t Ct ct.

a wy t uc t xp lb fTTP nBn t xt b t cbt wt w u

mt u pm t t bmt ptmt bck. fb t t , fTTn, c

bwt t mgb xp by mkg u t xtg cpp tuctu v t t w

u mt b cg t cutm pm.

9 Rupert Wood, FTTx Rollout and Capex in Developed Economies: Forecasts 20112016, Analysys Mason, April 2011, p. 6.

10 OECD (2011), Fibre Access: Network Developments in the OECD Area, OECD Digital Economy Papers, No. 182, OECD Publishing, pp. 17-19. Available: http://dx.doi.org/10.1787/5kg9sqzz9mlx-en



Wt w y fTTn u uppt w xcg 100 mgbt p c v t gt

cpp. accg t nBn C w bu pjct u m, uc cg wu cmp

t w p u t nBn u ct t m c m w.11 T pv t

t pty cp gcy tuctu t py pt pvg bwt.

o cu b u gy u t wy t pm w (g) ug tt, u

t t cmmcy b. i m pc pcy g mtc ct my qu cpp tb pc wt b. fb wu typcy xt t yw t m uct t juty

t bu tct, ut cmmc pk, c, pt, mc ct uvt

jut m xmp.12

But t tb tw ubub w mt aut v, t xp pcg cpp wt

b wy gct tu p pm, m c my tm tt. T nBn

C 2012-2015 Cpt P tmt vtmt $2,800 c t 12.2 m pm t m t

p wt b, $4,000 c pm wt ctv vc.13

smp cmc gu tt g vb xptu t c b v

, ty u b.

THE PLAN

T Ct w v t, b b bb y t lb. ou m tt

vy t t u v cc t bb wt w t t btw 25 100

mgbt p c by 2016, btw 50 100 mgbt p c by t 2019 90 p ct

t x tpt tug t u b t t g pt p nBn C vg t

cut tt x w ut tm bugt.

W w v bb t ct t txpy. a Ct nBn w uc t ug m txpy t cpt mkt t cmpt t pjct by $60 b tw t cmp t t tc

tmt ct lb p. dt y upg t Ct tmt tt lb nBn w

qu m t $90 b pubc ug, twc muc lb mtt, ct

t bckgu pp wt t pcy.

W w u wt pt bb cv pty. icby, lb wg nBn C t wt

my bug v xtg t bb twk v fTTP m c w my cmmut

m wtut y vc t .

fy, w w u tt u m bu mty b tp bb vc

m b. Vy t bb tt bt b b c b xt c t

t wtut t mg pc k ppct u lb.

Leveraging existing infrastructure

extg tuctu vt t py t Ct ttgy. a Ct nBn w mk ubtt

u fTTn.

11 NBN Co, 2012-2015 Corporate Plan, p. 64.

12 In truth almost all large institutions such as universities and major hospitals have been connected directly to fibre for some years, as have the vast majority of schools. This is why the Governments

constant boasts in the early days of the NBN of connecting schools have been hard to provide evidence for in Parliament the bulk of schools had fibre well before the NBN started.

13 NBN Co, 2012-2015 Corporate Plan, Aug 2012, p. 72. These figures represent total capital spending on fibre plus a pro-rata share of shared capex from FY2011 to FY2021 (or approximately $33.8 billion)

divided by 12.2 million premises able to connect to the fibre, or 8.5 million with service.



fTTn pv g bwt t mgb ct by pug b p t t twk c

t u, ucg t gt t cpp cct t w u mt.

Wt w y, fTTn u uppt pk w xcg 100 mgbt p c v t

gt cpp. fTTn ct p pm g m 20 t 33 p ct fTTP.14 Yt t mt bb

u t vc pv by t tw ut w b tgub bcu t ppct ty u

t t vy g p y fTTP c pv.

Where does fibre to the premises fit?

fb gy u b py w (g) ug tt wv cpp t b

pc (u t ptcu cmmc t t ). T w b tb

w g mtc ct t ct t cpp fTTn uttctv t bt

ttv fTTP.

W t c cmc c mtm cum m fTTP mt ty, t

w t cy m t c. Ty ppct w cg vv, ptcuy wt t

cu vc. T Ct pcy tcpt t pbty u t p .

Coalition NBN rollout at completion

T tb bw pv ummy t ut nBn ut ccg t t bugt v t

tmm vg by t Ct ct t c t 2013.

a c b , t buk tb (bw) pm v by fTTn wc ccut

m t tw-t t tt ut, u 90 p ct xt t x nBn t t-

wg btw 2014 2019.

T ugy 10 p ct t- pm v wt fTTP t 2014 um t b wt

t pt mt mtc-tv cpp. ov, g pm ccut m t

1.6 m t 2.8 m fTTP pm 2019. nt tt t tb t um y ctbut t

fTTP m c-u b.

The Coalition NBN at finish of rollout in 2019

fb t t pm (fTTP) 2,802,000 22%

fb t t (fTTn) 8,968,000 71%

fx w 572,000 4%

stt 372,000 3%

Total premises 15 12,712,000 100%

14 Direct accounts from carriers including AT&T, BT, Deutsche Telecom and Chorus (all of which have deployed both types of network) uniformly indicate a ratio of 3-5X between FTTN/FTTC and FTTP. This is

confirmed by published analysis: WIK Consult, Report for the European Competitive Telecommunication Association, 2008. WIK estimated FTTC costs were $690 per premise in Germany and $530 in

Sweden. Costs for FTTH were over four times higher at $3100 in Germany and 3.5 times higher at $1900 in Sweden. Alternatively see: Analysys Mason for UK BSG (2008), Final Report for the BSG: The

Costs of Deploying Fibre-based Next Gen Broadband Infrastructure, 8 Sep 2008. This r eport estimated the gap between FTTC/VDSL2 and GPON FTTP at 4-5X in the UK. The differential is larger in markets

where labour costs are higher..

15 This table assumes the number of addressable residential and commercial premises in Australia in 2019 is the same approximate number estimated by NBN Co in its 2012-2015 Corporate Plan

based on GNAF data.



Revised rollout objectives for NBN Co

i ct t Ct w u t nBn cmpt ct ctvy pb. a

v bjctv w b t: w t t btw 25 100 mgbt p c t w

t by 2016. a wt p vc w cv pty. rgut t w pc w bcm

pc cp.

a ky g lb nBn b mg w ( g) tt mut-wg ut

(MdU). Pvt ct vvmt w b cug c c.

New statement of expectations

W w u v ttmt xpctt ctg nBn C t pv bb vc wt

mmum w t t 25 mgbt p c by t 2016 aut,

50 mgbt p c by t 2019 90 p ct t x tpt. T g um t

cut nBn C tt x w twk py cu.

T w ttmt xpctt w gt nBn C b mgmt xbty ct

tcgy twk g c.

T ttmt xpctt w pcy mt t pubc cpt vb t nBn C. T mt w

b $29.5 b.

nBn C w b qu t cv t bjctv w pvg ptv t-t tu

pt-ct quty vt by txpy.

Pricing commitments

ay um t w pc nBn C utkg ccpt by t aCCC w bcm um

t w pc cp cty cmpb puct.

ntwk pt cug nBn C cu y w pc puct ( puct mt)

tt bw t cp.

i t bc y uc ccpt utkg m nBn C t t aCCC, nBn C w b qu t

uc t puct mt pcg v t xt 10 y t cv t-jut 10 p ct

t cmb w pc tw c puct u.

T c puct w b: t ty v bb puct t mt wy puc bu

bb tpy g.

T xpctt w b ubquty wv t aCCC ppv utkg m nBn C cug

m pc ct.



Rollout priorities and duration

Wt 90 y t dptmt Bb Cmmuct t dgt ecmy, wt t tc

nBn C pvt c, w pv Pmt wt kg bb quty vbty

aut. T kg w b pub cmmt vw w gu ptt

t ut.

W w qu nBn C t m t ut p wt ct m t t cmmcy b t t

gt pty t t t quty v .

By, t t Ct xpctt tt xcut t ut cb t pcy w tk pc

v x y m 2013 t 2019 cuv, b cmpt 2019.

appxmty 65 p ct t fTTn pt t ut xpct t b cmpt t u y t

2016-17. T mg 35 p ct w b py 2017-18 2018-19 w mt c b

v by hfC twk.

Satellite and fixed wireless networks

nBn C w pc wt t xtg tt x w twk vg t mt mt v

p ct pm. T Ct utg tt t mt mm cp t vy t

cmmtmt.

T Ct ct tt kg pptut t w vtmt t x w

twk t mpv cvg c cmptt mg mb c g . T

bjctv ubjct t ctctu ctt cu w t cumt.

W w c pptut t vu m t tt ctct by kg pvt pt w t nBn tt vc, t b pc vc v g cum t b

mpv.

Broadband in new housing estates

fb w gy ctu t b qu w ug vpmt 100 m t. W w

ttmpt t gtt gmt wt Tt b tuctu ub-100-t vpmt w

t b cmmcy vb.

Pvt tuctu bu wc ctuct b tuctu w tt tt mt nBn pc

t w b gv pt tg tm t nBn C t g x pc.

Pvt bu/pt b twk w tt w b c ctv tt ct

y t ct vg tt t vtmt gt nBn C, pv uc twk mt nBn

pc t t w mk tm vb t cc k -cmty tm

t w pc c puct g t nBn C w pc cp ( m pc

cmmtmt g by nBn C t aCCC).



Broadband in multi-dwelling units (MDUs)

Vy t bb c b v t vu ut wt MdU by tmtg t b t

bmt tcm m t ug xtg cpp cb twk t bug t c c

pm. W b t w t nBn w b v.16 Bug w w cu wy v

t pt b cct t vy pm ty py t tmv.

Competition

Cmpttv mkt v v vt ct uct tcmmuct c t

y 1990. T Ct w mv wv mpmt t tuctu cmptt tuc t

pv mpy t lb nBn, vtgt pptut t vgt c cmptt

mg t vc pv (w p tt mpy tuctu wu b ymc t

mkt v b uu).

Structural separation

W w ctu t pt t nBn t w-y y-2 bttm cc twk vb

t cc k tpt -cmty tm. W w mp m bgt y

utu w() t nBn twk.

rt vc pv wu t ct t pv vc v v t nBn.

W t nBn ut ug fTTn, xtg cmmuct vc t gv w cut v t

nBn C ct t m t.

Cmpt t nBn w mpmt t tuctu pt Tt.

W w pbt nBn C m uppyg vc t u mp m tct y utu

w() t nBn twk.

Retail services competition

U u p, nBn C w t vc pv t m 121 pt tcct pc

u t cut nBn.

rt vc pv my c tgt ct t bt cc t cutm v twk u p

wp u t cmm tc t. W w qut t Cmmuct ac

(wkg wt nBn C pvt pt) t t t tc pc t vcpv qumt uc g, pvg, bg, t mgmt ptg .

Infrastructure competition

U u p, guty mpmt t t ctuct pt -nBn cc twk w

b mv.

T w/pt w g p bb cc twk w, wv, b qu t mk

tm vb t cc k -cmty tm t w pc c puct

quvt t nBn C w pc cp ( m pc cmmtmt g by nBn C t

aCCC).

16 This is the standard approach to connecting apartment in MDUs in a number of countries including Korea and Japan where very fast broadband deployment is far more widespread than in Australia.



U t xtg ctct btw nBn C t Tt optu t t, t tw

c hfC twk ct cy t bb vc vc t y pm c t cct

t t nBn. T nBn C m ubtt c cmmtmt tu t tugy t-

cmpttv gmt. subjct t qutb -gtt t pv tcty t nBn C

t Gvmt, u g wu b t mv y ctctu mpmt t t u xtg hfC

twk bb vc. a ky ct uc gtt w b ug p cc t

twk cp c cmptt t vt .

Fibre on demand, co-funded fibre and future fibre upgrades

T Ct ckwg tt m u my wt g p t c b pv v fTTn

b y vc uc t b mkt. lkw, fTTP m ccumtc my b

by t t gvmt, tuctu pt pvt vt cmcy ttctv

cmmcy ttctv. fy, mkt w cy vv v tm vtuy my qu

ut upg t twk w b t b xt t u pm.

rctg t t pbt, t Ct pcy pv : vu t bt b u-

py b w b; xt pubc pvt vt t pp c-u fTTP ut ty

wg t put w 50 p ct t ug; xpct utu upg pt t b

cpt t -fTTP nBn C x ctuct.

Fibre on demand

nBn C w pv b m t vu pm pb w b t

xt t t pm t tccy b cmmcy vb.

ay ctctu gmt gg y pct b m btw u t

vc pv / nBn C mut cu tm t w t t vc pv t tk v tvc, ubjct t t gtmt cmmc tt t t t vc pv bg pct.

nBn C pb pv b m w t wp t b.

Co-funded fibre

stt c gvmt, utt vt my v tt wp ug b ut

ct umb : p t u qut ( u cmmttg t ptcu

vc); t vg pcmt pymt t tuctu; bcu fTTP mtg

pcy bjctv; cmmc b. nBn C w pt t cmg Ct gvmt wt

180 y t cmc pt bty c-u fTTP pymt.

fb c-u w pv t t 50 p ct t (cmt) ug t pp. ay t

c wp gmt wu b mtt gtt btw nBn C c-u()

but mut b ctt wt nBn C w p-cc bgt.

nBn C my u y c-u pp tt cmmcy pty b, pv

wtt xpt pv t t gt nBn C Mt.

C-u b upg mut t t wt nBn C pty ut t u-v .

nBn C pb ptg mgg c-u pt t twk.



Future upgrade path

W nBn C xt b by xcg but t t u pm (.. py fTTn) t w b

qu t p bu utu upg tt tk b ut t t . a fTTn

g mut b upgb.

NBN Cos contractual commitment and reporting

T Ct t cc t t ctct t t by nBn C but u tt t u t

ctctu cmmtmt t upp t pt cug Tt, pppty t t by

nBn C.

T Ct v t gt t vw k t vy y t ctct gt t Ct

bb pcy t ptct t tt txpy. hwv t Mt w k t

t b tt t tm c vt y ct tct gmt btw

t pt, Tt kpt w.

NBN Cos contractual commitments

nBn C w pub t wbt, ubjct t ctty, ctctu cmmtmt wt t m

tpcy tug qu Gvmt ptmt.

NBN Co and Telstra

W my k t gtt vt t cmmtmt t pv cc, w t nBn t b m

qucky py tw ct bt.

nBn C w k pmt cc t Tt cpp btw pm cctt pt uc

p, cbt xcg. Tt pubcy tt t cpp mm cmc vu, g

u t tcpt ct-ctv cc w b ttb.

NBN Co reporting and disclosure

nBn C w pt t Pmt ut u tk-up mty b. nBn C w mk

t t vb c wk t nBn C wbt.

nBn C w pt t Pmt t c pmc quty b.

Review of NBN strategy/policy process and NBN governance/industry matters

T aut pp v t ct but lb nBn t t pubc pcy pc

u b tu t p vt m p t utu. nBn C mut b cut, bt t

u t c b pup vc m t pcy t m y pt mtp. i

ct t Ct w tt t vw, c wt pcc cu ptg z.



NBN Co strategic review

T vw w b p but gu bu vw nBn C ut pg ct, tuctu,

t cpbt, cmmc ppct ttgc pt. T vw w pt bck t t

Gvmt wt 60 y t wg:

T pg ct t ut, nBn C c pt ttu.

T tmt ct tm t cmpt t fTTP nBn u xtg pc.

T tmt ct tm t cmpt t nBn vt m t t cut p,

uc fTTn tb (bw) pp by t Ct.

T cmc vbty nBn C u ttv ttg.

T mpct cpt ct pcp ct cvy w cum

pc u t xtg ttv ttg.

rcmmt gt tuctug v nBn C ttgy t cv

t Ct pcy bjctv.

Independent audit into broadband policy and NBN Cos governance

T vw w b pt pt ut t xm t pubc pcy pc wc t t

nBn nBn C gvc. it w v t bjctv ug pcy pc gvc

g m ct bb pcy cptu m pubc. T pt ut wv tm

c tt cu t wg:

T vc pc wc t nBn C tbmt.

T g b t mt t u fTTP t 93 p ct aut.

Wy ct bt y ttv m bjctv pt vw t

c w utk.

nBn C gvc, mgmt t ccutbty t b c, m tcpt t y cg gvmt.

Wt ccut tmy mt but nBn utcm b pv t

tm t Pmt txpy.

Independent cost-benefit analysis and review of regulation

T vw w y t cmc c ct bt (cug bt ct ct

ct) g m t vbty bb g ppt v vu tcg, t

mk cmmt t gvmt uppt umb t g-tm uty

mtt. T tuy (wc w b cuct t m-gt m y pvu nBn ctvt) w pt

wt x mt t qut:

Wt t ct ct vu, cmc c tm, c bb

p, t wt xtt u bb b uppt by gvmt?

Gv t Ct vcg pcy bjctv, wt t ptm g-tm wp

guty gmt nBn C?

hw u t ctvt nBn C b ct gv t mt t cty bu,

pt mt w-y cc twk?

hw u nBn C cpt vtmt, puct pcg b vw gut?

a nBn C puct tuctu t pmt ccy, cum cc cmptt?



Wireless broadband and regional mobile services

Cmp t t m lb pc v ct t x tcmmuct mkt, t

w mkt by g p. But t g aut v b gct

wt t Gvmt bv cu t x- nBn. i cg y wy t vg t nBn t

mpv mb vc, t Ct w b mu cmptt pcy bjctv w w ct.

NBN Cos fixed wireless network

Wv pb, t Ct w u tt nBn C t uc tw bcku w b m

vb t c t ctt mpv vc.

T Ct w b mu cmptt w bb pcy bjctv cg

pptut t t t x w ut.

T Ct wcm pp m tt pt (cug xtg c twk

tuctu pt) gg ctctuy b jutmt t t x w ut wc:

mpv t quty/cvg mb vc g ; c cmptt cc g mb cum; uc t t ct t x w twk; bck pt.

Mobile black spots

T Ct w k pt m nBn C mgmt y pptut t vg t x

w ut t bck pt xt gwy mb cvg.

a g pcp y nBn C t py t pup w b vb t y c p

cc tuctu.

THE CHOICE

Bt lb t Ct g t vu uv t bb t u, bu, t

cmy gvmt vc vy. But lb pv ub t v t bt

tmy b m.

o t cty, lb cut nBn mg t wt mt xpv pb ut t t

qut w t upg tuctu.

lb -tbmt pubc mpy cuc ct t cmy, t cc u

t wg pt, ct bt, k guy xpt vc, mtt t pv

pcy pcp t pt 30 y.

T Ct, ctt, w t t t m t pmc. T cu t vu

gu y; t tpcy ccutg t ct utcm pc; t

mptc cmptt.



THE CHOICE AT A GLANCE COALITION NBN LABOR NBN

scu ctuct p17 2014-2019promised: 2009-2021

likely: 2009-2025

Cpt xptu18 $20.4 billionpromised:$37.4 billion

likely: $71 billion

rqu ug19 $29.5 billionpromised: $44.1 billion

likely: $94 billion

dw t25-100 mbps by end of 2016

50-100 mbps by end of 201925-100 mbps by end of 2021

P c by mt u 2021

20 12 mbps 12 mbps

2021 tmt w pc/mt

$38 $62

2021 tmt t pc/mt21 $66 $90

Cmptt tuctu? Yes No

dupt t u pm? No Yes

Pc c b t pc cp? Yes No

17 In the first three lines of this table, the first data point provided for Labors NBN is the Governments current estimate. The second figure is the Coalitions estimate of realistic schedule and costs.

The basis for the latter is set out in this policys background papers.

18 Capital expenditure is money spent on fixed assets such as equipment, structures or buildings.

19 Required funding is the money a new project or company needs to raise (as equity or debt) to reach a point where it can sustain itself without assistance.

20 NBN Co. 2012-2015 Corporate Plan, p 64.

21 These estimates of retail prices for an average broadband/voice bundle assume that in 2020-21, the dollar margin between wholesale access prices and retail broadband prices is about $28 the

approximate current figure. NBN Co does not have control over retail prices under either partys policy these are set by the market. It should be noted that under both scenarios, average retail plans in

2021 will include more (additional services, higher speeds, larger data quotas) than current retail offers.



T tb mp cmp t Ct ppc t t nBn wt tt lb. T

cmpt t, cpt xptu pubc u qu lb nBn tt bt t

Gvmt cm gu t m tc tmt pv t pcy t t

ct bckgu pp. T tb u v mptt vtg t Ct p

cug t wg:

T Ct pcy ut w b cmpt .

T Ct pcy qu muc cpt xptu muc pubc ug.W t pc bt gcty w u t Ct t lb.

i 2021, w lb nBn w uppy b cmpt, t bb p c by t

gt gup u (ccg t nBn C mg) w w t t 12

Mbp w wt t cpcty bt twk.22

T Ct pcy v gt xbty tw ky : cmptt pmtt

btw twk (uc nBn C nBn Tt hfC), pg kp pc w;

w pc c b t t um t w pc (UnWP) t by

t aCCC lb nBn (wc w b pc cp ppv by t aCCC t c

Ct nBn).

Project budget and scope

fm t cpt t t cgy c ct g tt t ut t vg tg, lb

nBn tu t pcy c c u xcut:

i ap 2007 Kv ru stp Cy pm nBn but ptp wt

pvt c tt wu ct txpy $4.7 b b by 2013. i nvmb

2007 tt cmmtmt p lb w t f ct.

amt x y t, t nBn bugt bw ut t t 10- ccg t lb

w tmt. nBn C w ct by lb t qu t t $44 b cpt t

t twk bcm cy -upptg m tcy w twc tt mut.

Rollout targets

T nBn ut cutm tgt v b pty m :

i dcmb 2010, Ju G pm tt by Ju 2013 t nBn b twk wu b

vb t 1.3 m pm vc t m t m.

i augut 2012 t umb u ct t b ug t b by Ju 2013 w

bupty t 54,000 tt t pvu tgt.

i Juy 2013 t w v tt t t dcmb 2012 y 10,400 u w

ug t b. hwy tug t 2012-13 c y nBn C cv t

t t y vty uc bjctv.

at v y lb gvmt, t t 2012 t b twk p y

72,000 t 12.2 m pm t m t vc by 2021.

T u xcut pty ct lb ty -m pcy pc m p

c t nBn C. But ty uct t c ucck mbt lb p,

wc tu ct ck cmmc xpc ( y wt w tcy b) wt

t Gvmt.

22 NBN Co, 2012-2015 Corporate Plan, p. 64.



T Ct ttv tc t c bjctv, t c pubc ct cpbt. it

ptu m tb ppc cmpb mkt t bb pcy t lb

uqu nBn. it w b p t t ug utmt ct tm tt v cct

lb nBn t t.

Prices

it tg tt w u v cv btt bb. But tg tt

lb ppv nBn C v Cpt P, wc xpcty pjct mty vu m c u

w mt tb m vg $22.46 2011-12 t $62.11 2020-21.23

T ct g pc ct nBn C pcg cm t ug, wc pu cg up

py v u w vum gw t t t, my t u m tkg vtg

b cpbt. T t ug cg ttmpt t mw cc t ct t nBn, t

pm v p ct tu pm t txpy lb cmmtmt tt pc quvt

bb p w t b g t nBn.

W t vc pv mg cut t tcpt, t cut t t t g t

aut uuuy g cut t pc x bb. T y mg t w

gt pctg g t cm: 40 t 200 p ct bv t t UK, Us, Jp,

sgp, sw, t nt, C, f, dmk, fc, ity Gmy ( ct mt

t cut gt wc w k t cmp uv, xcpt nw Z). 24

i p c w cg p u u lb nBn tt t g t cc

pc t pub t vg my w cm u bg ck ut t cmc c

pptut pv by bb bcu g pc.

aggv pc c my um t pcy bjctv uv vbty, uc cp gvmt t tk vtg t ccy vy. My t 400,000 cum t

-up w cm my buk t g pc u t nBn.

T Ct pcy w vt t t mgtu w vu p u. W v

pct u bu c vmp nBn vg w x vu p u gwg

t t t cmy. i t w t w m tb t cum wt.

Competition or monopoly?

a ct t lb pcy t ytmtc mtg cmptg x twk, t u nBn

C b t cu vtuy x vu xc y utt mkt pw t p cv t

upt ct m t vc pv u ( t t spc acc Utkg

t t aCCC).

U lb, w t nBn ut, Tt cpp optu hfC cb ( pt) w b ut

w. Tt hfC ( pt) my cy fxt but t bb vc. aut uqu t w

bty tmpg ut cmptt btw x twk.

23 Average revenue per user (ARPU) per month is a commonly used price metric in the telecommunications industry. The figures cited for NBN Co reflect the financial data on p. 72 of its 2012-2015

Corporate Plan. Note that total revenues for each year have been divided by average (not year-end) users for the year. This offers a more realistic ARPU during periods of rapid customer acquisition.

24 The annual cost of the International Telecommunications Unions fixed line broadband basket (a standard basket of services and usage) calculated as a percentage of Gross National Income (GNI) in 2011

was 1.5 per cent in Australia. This compares to 0.5 per cent of GNI in the U K, 0.6 per cent in the US, 0.7 per cent in Japan and Norway, 0.8 per c ent in Singapore, Sweden, the Netherlands and Canada,

0.9 per cent in Finland, Denmark, France and Italy, and 1.1 per cent of GNI in Germany. International Telecommunications Union, Measuring the Information Society, Geneva 2012, p. 88.


18/18

aut pt by B lug, t lb Pty, c Bck Mcqu st, Bt aCT 2600. ap 2013.

T ctt wt Ct pcy cu t b c. subjct t gtt wt t w, w w

mv mpmt t u t hfC twk, w w w -nBn pt t t t x

mkt (ubjct t g t twk t cc k quvt tm).

ov tm, t Ct w k t pvt cmpt nBn C gv u gtg vw tt

tcmmuct pv u t b gvmt-w. W t tt t lb Pty

cmmtt t pvtg t nBn c t cmpt.

COSTINGS

T Ct t pvy t nBn C ctctu gmt nBn C gcty v t

ut c ct mutp cc c 2010. T Ct ttmt ct

pp g t, but ct u cu nBn C ctctu bgt c,

t b Bugt gu t P-ect ecmc fc outk (Pefo).

Overview of Coalition NBN

T Ct bb pcy w v t b bb t ct t txpy.

T Ct w p $20.4 b cpt xptu t bu t ttv nBn. T 45 p ct

t t cm mmum $37.4 b lb nBn 71 p ct t t m tc

tmt $71 b t t bckgu pp wt t pcy.

T tt ug qu t Ct nBn $29.5 b. T 33 p ct t t cm

$44.1 b lb nBn 69 p ct t t m tc tmt $94 b t

t bckgu pp wt t pcy.

a wt lb nBn, t c btw t cpt xptu qu t ctuct t twk

($20.4 b) qu ug t Ct nBn ($29.5 b) ct ct m ptg

ctctu gmt y t t by nBn C.

cc coalitions plan for fast broadband and an affordable nbn

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