Friday, 31 May 2013

NBN: Conroy responsible for maintaining the politicisation of the debate

The choice of Customer Access Network (CAN) technology and the means of its update are Technical, Commercial and Economic considerations. These are dry, rational discussions, based not on opinion, but hard facts and numbers. Bits are completely agnostic: they work no matter what network or connection they arrive over.

Instead, we have the mess that's the politicised NBN Argument of Ideologies. In no way is it a debate, but that could be changed somewhat by a single action: an independent review of the NBN Plans of both sides.

This politicisation only brings heat, not light, and doesn't help the electorate decide on facts, but forces them to take sides. This can only lead to a poor result, failed expectations and years of recriminations.

This craziness didn't happen for much more important issues: the switch-off of analogue TV, unleaded Petrol and change to Metric System. What's so special about replacing our communications infrastructure?

The Government, by not damping down this sideshow, is allowing a bad situation to become worse.
Very little is needed to take the wind from the Coalition arguments and deny the rabid trolls their oxygen:
  • hard data, credible numbers
  • independent, expert analysis of the strengths, weaknesses of designs and sound financial modelling of Project Risks, both upside and downside, of both major party plans.
    • And Apples-and-Apples costings, run for more than the life of the transitional VDSL/FTTN network.
Turnbull's policy modelling included stress-testing of the NBN Co plan. While I think that the figures chosen are unsupportable and selected only because they could produce a bad result, the approach & attempt is one of the best policy reactions by any Opposition I've seen in 40 years.

That's an important point: Turnbull must be lauded for adopting a thoughtful and credible response to the Governments' roll-out. Project stress-testing is exactly the right approach. Outrageously fiddling the numbers demeans and devalues the analysis in my eyes.

Senator Conroy as the Minister for Communications has the money and commercial-in-confidence data available to create an authoritative analysis of both policies. Useful models don't have to be finely detailed, only "good-enough", with, say, a 5-10% error. An informed, capable team should be able to prepare a useful report in 3-4 weeks, provided they are given access to the required data and esimates.

This is what I'd like to see done by independent experts given access to the data & estimates needed:
  • Turnbull's four stress-tests rerun with believable data and a stated probability level. (1 in 10 or 1 in 100)
  • Turnbull's Worst Case Scenario rerun with new data and its likelihood stated (1 in 100,000?).
  • The same, or appropriate, stress-tests run for a VDSL/FTTN network.
    • Including a detailed CapEx and OpEx breakdown until 2040, matching the NBN Co Corporate Plan.
    • The impact on Revenue of "single access rate charge", cherry-picking and "ACCC mandated highest wholesale charge".
  • Full Fibre and 70% FTTN models both run for the current NBN Co plan, with Download Volume growths of:
    • Current 30% pa
    • ABS's 50% pa
    • CISCO VNI 66% CAGR
    • And the current 44% 100Mbps with average 47GB/mth, not 30Gb/mth as the baseline.
    • Update for 1Gbps service. Unsure adoption rate to use.
    • Consumer Out-of-Pocket expenses needed for first "NBN Connection" point.
      • Line testing and remediation costs, if any, needed for VDSL.
      • VDSL+Telephony needs a Central Splitter
      • Standard 2*UNI-V, 4*UNI-D NTDs (Network Termination Devices) are not mentioned in the Coalition Plan, while they maintain "In-premises costs are not included". This needs clarification.
  • Under the 70% FTTN model, the break-even period built into the Coalition model and the conditions that might lead to the Copper CAN to be shutdown before this break-even period.
Experts in this field will come up with other, better, tests and modelling.

Also, Telstra need to issue an ASX statement clarifying Mr Turnbull's insistence "They will" in answer to "Why do you think Telstra agree to your proposal". If there have been back-room deals done, which I believe not to be the case, Telstra needs to inform the market.

Mr Conroy won't listen to me, I don't have recognised credentials in the area. Perhaps he'd respond to a petition or open-letter from a large group of Australian Telecomms Experts, including, say, Prof Reg Coutts from the original NBN Expert Panel.

Anyone out there able to put this to any Telecomms Experts?

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