News & Discussion: National Broadband Network

[monotonehell]

It seems, beacuse I do not subscribe to the theory that we need fibre to every home etc,that I get accused of not reading posts, or I am stupid or live in the 1800's or something. I read all the posts, discuss with IT poeple at work, do my own research.This arguement is not new in the world. This same issue has been discussed even in my own company overseas. Suffice to say,within my company the areas without FTTH have not collapsed or vanished overnight, they work with the same system at the same speed as everyone else. All are surviving even in France and UK and US, with no direct cable. See the thing is, most people I speak to are of the same mindset. We just dont see the big picture, the need for the expense, and the apparent dire consequenses of not going full fibre to home immediately. When the apparent pending disaster of the Liberals system is up and running, I may well change my attitude, get a job disposing of all those cabinets, and you can all throw me in the new Victoria Square fountain!

The only reason we've come to the conclusion that you're missing the point, is that given the three options (1. do nothing, 2. FTTP, 3. FTTN) your argument for saving money would make you select "do nothing" because "FTTN" will end up costing more than "FTTP". Which just quietly I hope is the Lib's plan. I think they will win the next election, I'd hate to see them go through with the waste that the FTTN plan is. I pretty sure that several of the Lib's plans will be put on hold after they come in due to "the budget". I've read between the lines of the language surrounding these promises. (If you'll excuse the mixed metaphor.)

[Aidan]

All the proponents of "build it once, build it right" appear to ignore the time cost associated with money. Borrowing massively now may well be more expensive than paying overall more (in today's dollar terms) to stage an NBN roll-out that firstly goes to a node and then goes all the way to the premises at a later date.

There's no chance of that at all. Even if the enormous costs of building the nodes and maintaining the copper were disregarded, doing it right from the start would still be the cheaper option, because wage rate increases tend to exceed the interest rate.

Balanced investment decisions are required - it is obviously a very fine line between borrowing to achieve positive outcomes, and not over-extending yourself in the event things go to crap - and yes, we may well still be on the cusp of a deep global recession and as you say, these things can happen very fast like dominoes when something major hits. It would be a foolish government that doesn't consider the risk of major recession in the near future - and fast broad band won't be a priority if we cannot pay the bills (take a look at Greece / Cyprus and a bunch of other economies right now).

The main problem for countries such as Cyprus and Greece is that they're being denied access to the credit they need. Australia owns the Reserve Bank and therefore has an infinite credit limit. As long as the bills are in Australian dollars, we can pay them. And the bills are in Australian dollars - it's a long time since the Australian government borrowed anything in a foreign currency.

If the combined amount of government and private spending rises faster than our productivity, it tends to result in inflation, and for that reason it's sometimes good for the government to run surpluses. But right now we have the opposite problem: the risk of falling spending causing a recession. Anyway the NBN is expected to boost productivity. So the case for Build it right, build it now is overwhelming.

[rubberman]

The other point about the debt levels of Cyprus, Greece, Ireland, UK, Spain is that in all these economies, every one, the private banks failed and the government got saddled with their debt.

So, as long as any Australian Government says to private bankers, that if they fail they will become bankrupt bankers, and only guarantees Australian deposits up to the present limit, we can afford to fund the NBN.

It is only if an Australian Government transfers private sector bad debt into Government debt that we would have trouble paying for the NBN.

However, the problem for fibre to the node here is really big. Because if a future government bailed out private banks, we would not be able to take on more debt. That would mean that we could not then afford to extend fibre to the home as the copper broke down? How would people living in areas where the copper had finally broken down get even telephone services?

The point is that fibre to the node is not only technically inferior, it is more costly in the medium term, and carries the risk that if a future Australian Government bailed out banks, we could not afford to replace the copper as it breaks down.

I might also ask, which Party is more likely to help out its mates in the banking sector if they got into trouble? In which case, the fibre to the home would be a disaster if the copper in your street gave out.

[zippySA]

Australia owns the Reserve Bank and therefore has an infinite credit limit.

I'm no economist - but this concept is really really scary and I am amazed at how many people seem to think this way. Wealth cannot simply materialise from nothing (ie printing (lots) more paper notes) - money is simply a concept based upon confidence which is based upon a sound economy ultimately - a currency can collapse quickly and leave a nation in serious doo-doo - do you think we would be able to puchase all the wonderful things promised us using fast broadband if our dollar was worthless in the global economy (I assume 90%+ of content is generated overseas in hardware and software etc). Imagine smart phones costing $10,000+ each in a short timeframe......that's what a loss of confidence could do.

There is more than simple wage growth impacting future staging costs - there is also the key metric of affordability - initial productivity gains will theoretically feed a growth in the economy, thus generating more wealth which in turn enables further investment.

I am happy for us to have great broadband - but I'm not happy about over-investing to achieve ultimate promises and ambitions - call me conservative or risk averse - but I do like to keep something "in the bank" for the unknowns of the future.

[claybro]

I might also ask, which Party is more likely to help out its mates in the banking sector if they got into trouble? In which case, the fibre to the home would be a disaster if the copper in your street gave out.

I promised myself to stay out of this NBN discussion now, but I cannot let blatantly and politically incorrect comments pass. It was the Labour government who promised to underwrite Australian banks in the recent GFC. It was absolutely the right decision as it prevented destabalisation of our banking industry and enabled them to keep lending money, and any government of either persuasion would do the same in the future. Our biggest problem is the rapidly declining price of commodities which has proped us up for years now. Once they fall below a certain level (quite possible if China stumbles), we are done for, and this discussion of NBN will be irrelevant. You see, we are no longer in charge of our own financial destiny.

[rubberman]

I might also ask, which Party is more likely to help out its mates in the banking sector if they got into trouble? In which case, the fibre to the home would be a disaster if the copper in your street gave out.

I promised myself to stay out of this NBN discussion now, but I cannot let blatantly and politically incorrect comments pass. It was the Labour government who promised to underwrite Australian banks in the recent GFC. It was absolutely the right decision as it prevented destabalisation of our banking industry and enabled them to keep lending money, and any government of either persuasion would do the same in the future. Our biggest problem is the rapidly declining price of commodities which has proped us up for years now. Once they fall below a certain level (quite possible if China stumbles), we are done for, and this discussion of NBN will be irrelevant. You see, we are no longer in charge of our own financial destiny.

Well Claybro, if you had done me the courtesy of actually reading what I posted, you would have saved yourself some angst.

I specifically acknowledged that there should be a guarantee - and I did not mention a party with that statement for the specific purpose that such a guarantee should NOT be political.

Next, if you had taken the time to actually read about the Labor Party over the past thirty or more years, you would have noted that it has changed the spelling of its name.

i don't see how "...we are no longer in charge of our own financial destiny." Perhaps you might explain. We have been running CAD now for over thirty years (more actually), and we were surviving in the world before China was a major trading partner, including when we were in periods of resources slumps. During the second world war we survived, and yet had high deficits, high debt and some rather unfriendly trading partners up north - our iron ore exports to Japan did not get great prices over that period I think you will find. We have had several cycles of low commodity prices since then too. Yet apparently with much lower debt and much more benign world conditions than during the war "...we are done for...". Words fail me. In no way do I think we are facing a picnic, but "...we are done for..."??

Again, given that the fibre to the node proposal is more expensive in the medium term than fibre to the home, even if what you said was correct, then surely the logical position for one who believes that hard times are ahead (such as you seem to), would be to go for the cheaper fibre to the home, rather than the more expensive, chancy and technologically backward FTTN. Can you please explain why, if you think that when commodity prices fall, "...we are done for..." we should be going for a more expensive option such as FTTN? Surely we should go for the cheaper FTTH?

Having said that, you are entitled to your opinions and don't need to justify them to anyone else. Good luck.

[claybro]

I might also ask, which Party is more likely to help out its mates in the banking sector if they got into trouble? In which case, the fibre to the home would be a disaster if the copper in your street gave out.

Sorry, I must have mistaken this for a jibe at the Liberal party?

So, as long as any Australian Government says to private bankers, that if they fail they will become bankrupt bankers, and only guarantees Australian deposits up to the present limit, we can afford to fund the NBN.

Ah but here you clarified it ....but a limited guarantee to only Austrlian deposits wouldnt work, because by doing that the banks would still not be able to borrow more money from overseas to lend here to keep business trading if we tell the rest of the world to "get stuffed". The cost of money would become astromical.

The point is that fibre to the node is not only technically inferior, it is more costly in the medium term, and carries the risk that if a future Australian Government bailed out banks, we could not afford to replace the copper as it breaks down.

Is this fact?

How would people living in areas where the copper had finally broken down get even telephone services?

With mobile phones?

Next, if you had taken the time to actually read about the Labor Party over the past thirty or more years, you would have noted that it has changed the spelling of its name.

Sorry to spell Labor wrong.

[Aidan]

Australia owns the Reserve Bank and therefore has an infinite credit limit.

I'm no economist - but this concept is really really scary and I am amazed at how many people seem to think this way.

If you managed to overcome your fear and look at reality, you'd probably think this way too. There are genuine threats to the economy, but the federal government being unable to borrow money isn't one of them.

Wealth cannot simply materialise from nothing (ie printing (lots) more paper notes)

True. However when a shortage of money is preventing the economy from functioning effectively, printing more can ultimately result in more wealth. And the government would get the money back through taxation.

- money is simply a concept based upon confidence which is based upon a sound economy ultimately - a currency can collapse quickly and leave a nation in serious doo-doo - do you think we would be able to puchase all the wonderful things promised us using fast broadband if our dollar was worthless in the global economy (I assume 90%+ of content is generated overseas in hardware and software etc). Imagine smart phones costing $10,000+ each in a short timeframe......that's what a loss of confidence could do.

Currency collapse (aka hyperinflation) is a very serious problem, but it takes a lot more than just printing money to cause it. It also needs one of four things:
1) The lack of an effective tax system
2) A fixed currency
3) The need to urgently repay a large amount of foreign currency debt
4) Government persecution of export industries.

None of those are applicable to Australia, despite what some in the mining industry were saying in 2010.

If we print more dollars, our dollar will fall slightly, which makes our exports more competitive, which stabilizes the value. Smartphones wouldn't get ridiculously expensive - at worst there would be a slight rise in the price, but more likely the price would just fall at a slower rate. So there would be consequences, but not the consequences you anticipate.

There is more than simple wage growth impacting future staging costs - there is also the key metric of affordability - initial productivity gains will theoretically feed a growth in the economy, thus generating more wealth which in turn enables further investment.

And those initial productivity gains would be higher if we did it properly.

I am happy for us to have great broadband - but I'm not happy about over-investing to achieve ultimate promises and ambitions - call me conservative or risk averse - but I do like to keep something "in the bank" for the unknowns of the future.

What do you imagine we'd be able to do with something "in the bank" which we couldn't otherwise do?

[rubberman]

(Snip)

I am happy for us to have great broadband - but I'm not happy about over-investing to achieve ultimate promises and ambitions - call me conservative or risk averse - but I do like to keep something "in the bank" for the unknowns of the future.

I too, think that it is unwise to over invest. Many 'tech heads' just want the latest and greatest technology, and don't care about how much it costs. Given the situation in the world economy, we need to be investing heavily in productivity measures: Education, infrastructure etc to ensure that we are competitive in that economy. So we need to invest in infrastructure, but not over-invest.

Hence, I just cannot fathom why there is even a suggestion that the more expensive option of Fibre to the Node is even being considered. The biggest reason (and there are others) that FTTN is more expensive is because we still have to spend about a billion a year on maintaining the copper. FTTN headline costings always ignore this, plus the real costs to business of having to get the fibre extended to the premises, plus the cost of purchasing the copper from Telstra (as if they would give it away, snort, ). The only way FTTN can be made to look cheaper is to ignore the real ongoing costs of its maintenance.

So, for me, apart from the better standard of broadband that will come from FTTH, it is far cheaper in the medium to long term. The question I have, is why do FTTN proponents either ignore the ongoing costs, or want to build a more expensive but less efficient system? I mean not every one of them can have mates in the street cabinet building industry, so that can't be it.

Nor, might I add do I think it is Rupert Murdoch telling the Coalition what to do (well, in this matter at least). After all, if FTTN allows faster downloads, presumably it means that they can download his competition's stuff as well.

[rev]

I heard this week that they will at some stage later this year, be "turning up" the NBN network to 'full' or whatever, with speeds reaching 1000Mbps download and 400Mbps upload.
I assume though that such speeds will not be offered to the household consumer but be available to government, businesses, research, medical and educational institutions.
I've also heard that, I think it was the CSIRO, have using the same NBN fiber infrastructure, managed to reach speeds of 4000Mbps...

[SRW]

Nor, might I add do I think it is Rupert Murdoch telling the Coalition what to do (well, in this matter at least). After all, if FTTN allows faster downloads, presumably it means that they can download his competition's stuff as well.

Not sure why you brought him into it, but a fun counterpoint is that Murdoch owns half of Foxtel -- a company that might well be wiped from the playing field by FTTH. Extrapolate from that what you will.

[rubberman]

Nor, might I add do I think it is Rupert Murdoch telling the Coalition what to do (well, in this matter at least). After all, if FTTN allows faster downloads, presumably it means that they can download his competition's stuff as well.

Not sure why you brought him into it, but a fun counterpoint is that Murdoch owns half of Foxtel -- a company that might well be wiped from the playing field by FTTH. Extrapolate from that what you will.

That is exactly why I brought him into it. I think that even though the download speeds of FTTN are less than FTTH, those speeds will be enough to dent Foxtel badly as well. So from that point of view it probably doesn't matter that much to Rupie which proposal gets up, FTTN or FTTH.

Originally, I am sure that is why Rupert told Mr Abbott to kill the NBN. However, I suspect that maybe Rupe has had a 'doh' moment and realised that since he owns a lot of content, he can send that content straight to Australia from the US via the internet without having to bother about Australian broadcasting rules (including pesky issues like telling the truth, should we ever require it), or buying bandwidth, or providing infrastructure (the NBN will do that under either party's proposal), or even employing a single Australian. Now in this case, Rupe can own, not just half, like he does Foxtel, but he can control 100% of what flows into Australia from his overseas organisation, and let the other half of Foxtel die a slow and painful (to the other shareholders) death. Not only that, since news content could be originated in the USA, he is in a position where he can be even more elastic with the truth. The reason for this is that if someone in Australia feels they have been defamed, they will have to pursue him overseas. That is much harder, and potentially much more expensive than doing it here. What's not to like about all this for an entertainment/news organisation? I suspect that this is why Rupert allowed the Coalition to introduce the alternative FTTN broadband proposal. Doh, Rupert, welcome to the party, better late than never.

However, for some reason, there are those out there that dislike the man, either for his politics, or for the fact that he heads an organisation that is under investigation for serious criminal offences overseas. I was just trying to head off a Rupie based conspiracy theory on the NBN, that was all. He has every reason to support high speed broadband, and either proposal will do at a pinch.

[[Shuz]]

Its a conspiracy!

[fabricator]

Given the costing of both NBN plans, $37B for FTTH vs $31B for FTTN, choosing the less reliable option to save $6B over 20 years or so is just pathetic. And given FTTN relies on old copper cables that in some cases date from the 1950's, there is just no way it can be as reliable as brand new fibre cables.

Any money saved in equipment in the FTTN plan is going to be slowly blown to the wind in the massive cost of repairs, electricity to power the 60,000 nodes, maintenance headaches, lower reliability and less choice of service. Of course this cost is instead passed onto the end users, wow paying more for a less reliable service with minimal to no option to upgrade to higher speeds.

FTTH is a quite simple and proven technology, which is built upon technology previously used to link telephone exchanges together and for undersea fibre cables. That is because cheap enough to deploy to individual houses is simply a sign of the usual cheaper/faster/better as seen in mobile phones, computers, cars etc etc.
FTTH works by transmitting a light signal down a glass fibre, which is modulated to some number of GHz, up to 32 of these signals (from separate houses/businesses) are combined/split using passive optics (think prisms) to feed back to exchange based electronics. Somewhere in the network is a small cabinet to patch 300 odd fibre from homes for testing/repairs. The only electronics drawing power is at the exchange and in people's houses, in between is brand new fibre which doesn't suffer from problems with water ingress (non conductive), and unlike copper fibre works the same speed if its 5m or 20km.

FTTN which requires a dozen heavy batteries, a transformer, cooling fans, and a big box of circuit boards. And all this is for up to 300 homes, filling a large cabinet. FTTH leaves a lot less above ground to maintain, look at, or get hit by cars.

Some of you people make me sick.
Seriously the Labor party put together a plan to completely rebuild our country's communications network, which will pay for itself over time (hence no cost to us), can be sold off if desired at the end for a massive profit (as well), will save the government money directly as they can use it for their own government offices (and stuff like traffic lights), and will be faster and more reliable than the current system. Are people happy with that ? No because they think everything is too expensive, that it's just technology for the sake of technology. Most brainlessly of all are the people that believe the current cabling isn't degrading over time and getting less reliable. All the Labor party want is to wisely invest in the best trade off between cost/benefit to upgrade the country's current old technology.

If your going to spend $30+ billion on either option, FTTH is the better bang for buck and also add serious speeds for business owners.
Only a drooling moron would choose the crumby option to save (what in the grand scheme of federal budgets*) is a tiny amount of money.

* 2012-2013 budget documents: "Investing $61 billion in 2012/13 in Australia's health care system"

[Vee]

Update on the 'Howfast is the NBN' comparison site ...
http://howfastisthenbn.com.au/

... by its creator, James Brotchie (via Crikey).
http://www.crikey.com.au/2013/05/10/con ... -nbn-site/

Interesting read.