Friday, 31 August 2012

NBN: Questions for Mr Turnbull on the FTTN agreement

I've commented previously on Malcolm Turnbull's plan for an FTTN-NBN and mentioned Alan Kohler's 'conversation' with him on the topic. This is a follow-up.

Just what is implied by Turnbull's announcement:
  1. For Turnbull to have a costed plan (== 'savings of $20B') then he must have generated, or had access to, a detailed plan and
  2. He must know that he can execute his plan or he's spouting rubbish.
Which means he's cleared all roadblocks with the owners of the copper network that will be used:
Turnbull, Thodey and Telstra (the Board) have reached an in-principle agreement.
If he hasn't done 1) or 2), then he's not the through, informed person I think he is, and deserves to be pilloried for a half-arsed effort.

If he has consulted/negotiated with Telstra and reached an "in-principle" agreement with them, including being given full/partial access to the 2008 Telstra FTTN plans, then isn't that germane and shouldn't we be informed of the terms of the deal?

It will be taxpayer dollars being poured into this scheme, all backroom deals needs to be made public well before the election.

Doing a quick google search, ZDnet reported the Feb 2008 tender for up to $4.7B was because "a solution mooted by Telstra was unacceptable to the ACCC" [and the "G9" proposal wasn't viable either]. Was that the end of 2007?

Knowing Sol and Telstra, they would've said in their 1-page response:
We own the copper distribution network. We're going to own and control any network based on it. Anything less is unacceptable.
Which would've been unacceptable to the ACCC, as anti-competitive and monopolistic.

So the public needs to be informed of any deal that Turnbull has already reached with Telstra...

What is different now?
Will the Leopard that is Telstra have changed its spots?

No.... It has a long, long history of pursuing monopolies.

The SSU [Structural Separation Undertaking legislation] doesn't mandate a transfer of assets, rather a relinquishing of their use [but not their removal?] when an alternative (FTTP NBN) is made available.

We are only at the very beginning of the transition, Telstra still has many options.

In this context, it is in Telstra's interest to be engaged in an FTTN - they will have the Government fund the actual build in exchange for them contributing an impaired asset, most of which is most likely ready
fully depreciated...

Is that double or triple dipping?

In return, I'd expect them to be given 49-50% ownership of the wholesale FTTN-NBN company.
Because of the politics and Telstra's commercial interests, it only makes sense for Turnbull to not fold the FTTN into NBN Co, but to create another company, possibly "related" so that it comes under the SSU legislation.

Not only do they screw Quigley, Gillard/Conroy and NBN Co, they setup a firesale with themselves as the only viable purchaser... All we have to do is look to the HFC Cable-TV rollout attempted by Optus for proof that Telstra not only think this way, they are quite prepared to write off tens of billions and sacrifice profitable new businesses to protect their monopolies.

It just gets better and better for both Telstra and the Libs, and worse and worse for the rest of us, retail customers and their competitors.

If I had access to the ABC, these are questions I've wish presenters like Leigh Sales, Emma Alberici or Steve Cannane might ask Mr Turnbull about his FTTN-NBN.
  • How is he going to get access to the Telstra copper distribution network?
    • that was a stumbling block for Rudd/Conroy, so how he's overcome it or pay the $20B for it?
    • has he already approached the Telstra Board and CEO about how this would work and what would work for them?
  • Just who is going to own the company that will do the FTTN-NBN roll-out?
    • will he be giving the contract to Telstra? What then of the SSU?
    • give the contract to NBN Co? How will that integrate with their work?
    • create a new entity for the FTTN-NBN?
    • would such an entity be wholly Govt owned for shared with Telstra? Taking this as their capital contribution.
  • Where is he going to get the detailed FTTN deployment plans?
    • Will he acquire them from Telstra, or rely on Telstra to give up in-confidence commercial and IP?
  • Will he make any guarantees about the service provided?
    • eg. "No person would be worse off than the FTTP-NBN".
    • Will ASIC or the ACCC regard those promises are mere political puffery or commercial statements, misleading if false.
  • How can he guarantee "$20B savings" if they don't appear on the FedGovt Balance sheet?
    • It seems like "smoke and mirrors" accounting and wouldn't satisfy the standard accounting principles.

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