NBN fibre rollout was going to be cheaper, sooner, pilot results show

09-Sep-2014

Labor's all-fibre national broadband network could have been delivered faster and for less money than originally forecast, according to the confidential results of a  pilot study completed last month.

The pilot took into account design changes formulated by network builder, NBN Co, last year as then chief executive Mike Quigley undertook a substantial review of the project and identified initiatives to reduce its cost and length.

The changes, which include adjustments flagged in the "radically redesigned" fibre-to-the-premises option in the government's NBN Strategic Review, were tested for the first time in a scheduled deployment to 2484 premises in Melton, Victoria.

Fibre connections to the premises began in February and included old and new buildings as well as some in rocky areas considered challenging for the rollout.

The evaluation, contained in an internal presentation document dated August 2014 and seen by Fairfax Media, shows a team combining telecommunications firms Celemetrix, CommsConnect and Linktech Telecom was on track to complete the Melton rollout in just 104 days, compared with an average of 344 days in other areas.

Ninety per cent of buildings were serviceable by fibre by the end of August - 61 per cent faster and 50 per cent more cheaply than in areas using previous rollout models, the document said.

Boring, trenching, pit installation, cable hauling and other building work were being completed between 22 per cent to 400 per cent faster than the average by using new procedures including thinner and lighter cables, visiting premises only once and better managing contractor relationships.

The results confirm Labor's NBN was improving in the lead-up to the election, a point Mr Quigley had pressed in a speech to industry group TelSoc in December.

He said the NBN was "knocking over the problems one by one and ramping itself into a scale rollout. And it was doing this without allowing any large increases in costs."

Industry observers were excited by the possibility the new numbers could help the government's reconsider using fibre instead of a mixed technology redesign that includes the rollout of fibre only to street corners, or nodes, not to premises.

Incoming Communications Minister Malcolm Turnbull dismissed the promised savings.

The strategic review recommended a multi-technology mix that will use a combination of fibre to the node and existing copper cables to connect most premises, with the rest connected by satellite, fixed wireless or fibre where applicable.

On Friday Mr Turnbull's office said technical decisions were being left to NBN Co. On Saturday a spokesman for Mr Turnbull pointed to the government's statement of expectations on the project, dated April 2014, where it states "the Statement of Expectations provides NBN Co with flexibility and discretion in operational, technology and network design decisions".

An NBN Co spokesperson said: "As any good business does, we continue to benchmark our processes to ensure we are rolling out the NBN as fast as possible, and at the least cost to taxpayers.

"The NBN is being built using the technology best matched to each area. FTTP remains a key part of the multi-technology mix," he said.

The Coalition government "has this dogmatic view of [fibre to the node] so that nothing else can come in," telecommunications analyst Paul Budde told Fairfax Media.

"Turnbull has been so dogmatic about his FTTN that even if someone said they could roll out FTTP [fibre to the premises] free of charge, he would not accept it."

Assuming similar benefits could be achieved in the entire network, the pilot results would also challenge the government's recently released cost-benefit analysis which concluded even the radically changed fibre-to-the-premises model would cost 2.71 times that of fibre to the node. The mixed-technology model would offer better value for money, it said.

Given the trial results, Mr Budde hoped Mr Turnbull would expand the use of fibre in the government's NBN.

"He is always saying he's agnostic about technology," Mr Budde said.

"If he's really so agnostic, and even he is on the record saying [fibre to the home] is better, why wouldn't he do the future-proof solution instead of going with unknown technologies, unknown copper quality and unknown situations with the 30,000 nodes we have to put in the streets – particularly if it can be done in a cost-competitive way?"

Mr Turnbull has on numerous occasions conceded the value of an all-fibre rollout, which has lower build and  maintenance costs.

"We know that fibre to the premises is the best technological solution and if you can build it cost-effectively you should do so," he told the media  in April 2013. "If we're able to build more of it cost-effectively then we would do so."

Several reports commissioned by Mr Turnbull since coming to power have blasted Labor's model, costings and management.


Sydney Morning Herald
September 6, 2014

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