
How Australia's $49B internet network came to be ridiculed - boyter
http://www.bbc.com/news/world-australia-41577003
======
ggm
First common mistake: Yes, Australia is geographically huge. No, it is not
sparce. it is a highly urbanized economy in terms of geographic concentration
of the population. Therefore, the oft-quoted extreme expense "oh, its so much
more expensive to do it in OZ compared to ..." is bullshit: its not. There are
of course some very expensive locations to service, but thats a USO problem.
Overall, the cost of deployment of the CAN is within scale of any other urban
economy. Higher than Singapore? Sure. But, comparable per head of population
to NZ.

Second common mistake: The argument which led to the MTM replacing FTTP was
not about technology. It was about the cost of capital works, and the economic
model of recovery. Labor was stupid enough to float a mixed-economy pluralist
argument hinting at a future independent non-utility model with zero cost
(long term) to the government. This hung them because it allowed the Liberals
to go hard on cost recovery and privatization. If the intent had been to
reserve a national utility function in layers 1 and 2, and promote competition
above this, we'd be in a different conversation.

That conversation was about structural separation of the former monopoly
Telco. It was quashed by Labor, in a stupid reactive move. It was floated, and
the banking sector indicated a preference. Reactively the union movement and
Labor party moved to reject it: if the banks wanted it, it must be bad.

Talk about a huge missed opportunity.

The NZ model, by comparison is gold: structural separation. Crown holdings for
the fiber. A pot of money, re-circulating to deploy to the cities, each region
re-fills the pot to move to the next town. Far simpler. And.. fibre to (most)
homes.

~~~
Gatsky
Yeah this is spot on.

Other comments are blaming the Liberals, but the reality is if you are an
effective leader trying to create a huge infrastructure project that you care
deeply about, you need to come up with a solution that will last through a
change in government, with aligned economic and political contingencies. If
you are just governing for fun then you do what Rudd did. It always lets you
blame the next government though, as he is doing now.

~~~
raides
To the Aussie's credit the infrastructure and the regulations instilled on
businesses there have always been Federally imposed.

Since the mid-90s the government has imposed many regulations for control that
has impeded much of the free market progress for network infrastructure. Those
regulations coupled with needed external transit installations have not
helped. For a long period of time the government would pick and choose
companies based on their ideals rather than their talent. This has hindered
progress from both sides of the fence by liberal and conservative
administrations.

I ran a semi successful ISP and consulting company for a decade in the US and
I have always enjoyed the tiering system we setup vs other country
Infrastructures. It wasn't until recently when the FCC gained control that
states started to use the new regulation power to hinder progress. I am still
on the fence about the whole thing because the exploitation has not been bad
in my area but the horror stores I have heard in other states make me sad.
Hopefully it will get back to normal.

~~~
ggm
I'm not personally sold on the baby bell model of regional monopoly. I think
the whole FIOS debacle, and what happened when google started offering
citywide fibre says a lot about how US telco industry operates. Lobby your way
to the people who make rules and then get rules passed to shut down anything
which freaks your own monopoly of indifference.

~~~
Trav5
I am curious and not sure what to search for. What are you referring to? Link?

~~~
Trav5
What was the "whole FIOS debacle, and what happened when google started
offering citywide Fibre"? Why the down votes? This sounds interesting, but I
am not sure what to search for to learn more.

~~~
ggm
I do not live in the USA. What I am told by my colleagues who do, is that the
post bell regional breakup created monopolies by location in order to prevent
national dominance but give each region a reliable income in a time of voice
call logistics. Fast forward to the emergence of fiber as a viable technology:
either you live in a location serviced by a telco who is willing to re-
engineer to fiber or you don't. Verizon exemplifies the quandary, it's a huge
cost, they have to carve out special data models for cable companies to stop
them refusing to drop coax, it's impossible to charge sanely, their shares
tank. I am sure there are happy customers but there is no clear equality of
service. It's a patchwork minefield.

------
Gatsky
By 'fit for service' they mean 12Mbps down, or average copper wire speeds.
What's the point?

Although the original goal was great, in hindsight it appears that it could
not be delivered anywhere near the original budget. For context, after a
prolonged period of centre-right government, a centre-left government was
elected, led by Kevin Rudd. He had a progressive agenda, but due to a
combination of his unmitigated egotism and internal party conflicts, he
instituted a variety of programs that were poorly conceived and executed, and
was ultimately ousted by his own party in a fairly disasterous manner. The
National Broadband network was a product of this highly disappointing and
dysfunctional period of government. Since then the problems have continued
across a change back to the centre-right government, who with a very slim
majority have essentially stuffed around for the last few years with a lame
duck leader who seems hamstrung by the ultra conservatives in his own party.

For my part, I'm dropping all wires and switching to 4G/LTE, where I can
stream 4K content, get decent uploads and still pay less than I would on the
National Broadband network.

~~~
gtkspert
Where do you get your cheap 4G/LTE?

Best I can find is prohibitively expensive, especially if I wan't to stream 4K
content...

~~~
boyter
Vivid Wireless offer unlimited 4G data capped at 12 Mbps for $90 a month. Its
on the Optus network so your experience will depend on what the coverage is
like where you live.

~~~
nrki
> Its on the Optus network

Actually it's a completely separate network to Optus' 4G network. Optus bought
them several years ago.

It's also highly throttled and utterly shite for most users. I was one.

~~~
boyter
Useful to know. I was considering moving over to them to save money on my
ADSL2+ connection. My area has fantastic 4G speeds without any congestion
issues as its semi rural and I was expecting them to be quite good.

~~~
justasitsounds
Have been with vivid for about 12 months, was supposed to be a temporary
arrangement while I waited for my building's strata to fix the internal wiring
between my apartment and the MDF in the basement. All of the NBN horror
stories and the strata's malignant incompetence mean I'm still using it and
it's pretty solid in my experience.

I'm in central Sydney and normally average around 10mbps down

------
owengriffiths
This article didn't mention what Australians are choosing to do when they have
a range of speeds. According to the figures NBN released 80% of customers
aren't even paying for the top speed they could. Similarly, this piece from
Vox notes that fast internet just is not nearly as valuable as proponents
claimed.

[http://www.theaustralian.com.au/business/technology/only-17p...](http://www.theaustralian.com.au/business/technology/only-17pc-
of-nbn-users-choosing-highspeed-packages/news-
story/20ab3be87d9cc9ca6760c3889e29fb41)

[https://www.vox.com/new-money/2016/10/17/13230500/gigabit-
ne...](https://www.vox.com/new-money/2016/10/17/13230500/gigabit-networks-
chattanooga-google)

~~~
girvo
The craziest part is that I was getting 100/60 that actually ran FASTER than
it’s advertised speed, unlimited (truly) for $69 a month, with TPGs private
FTTB network. But I had to move, and now I’m on an Opticom network; $99 a
month for slower upload, but I do get a static v4 IP, so that’s a plus for
what I use it for. And this is all in Fortitude Valley, basically the centre
of Brisbane...

~~~
ACow_Adonis
'tis true. Can vouch because that's the plan/infrastructure I'm on in
Melbourne.

I can only extrapolate my own experience, but perhaps if there was some truth
in advertising enforcement. I've had NBN plans elsewhere, and I never chose
the top plan, because I'd still be limited by other parts of the internet I
was communicating with in practice, and everyone knew the top rate plans
quoted speeds are literal nonsense. Why pay extra when you get the same
performance on the bottom/mid plan?

------
bhalley
Tasmania got very lucky with the rollout, we are mostly covered with FTTP,
Fixed Wireless and only some FTTN.

We are also lucky enough to have a local business (Launtel) pushing the
constraints of the NBN by offering Gigabit at prices that aren't unreasonable
($14.50/day). They are treating it as a new pricing model, why bill the same
as ADSL when there are no costs associated with setup and plan changes? They
are billing daily which allows more flexibility meaning you could spin up a
connection for a day (At an Airbnb for example) or change speed depending on
your usage.

This is all in beta for them at the moment and only available in Tasmania.
Here is a speedtest I ran yesterday from my home FTTP connection
[https://www.speedtest.net/result/6738001151.png](https://www.speedtest.net/result/6738001151.png)

~~~
contingencies
Wow. Just wow. My advice is buy cheap real estate and start an internatianal
incubator. The weather alone should keep people indoors and focused... only
half joking!

~~~
bhalley
It was like I had jumped into the future when this was connected.

The Tasmanian Government is actually offering grants to incubators at the
moment [http://www.startuptasmania.com/incubator-
support](http://www.startuptasmania.com/incubator-support)

------
ClassyJacket
The tl;dr is that Australia started a fibre-to-the-premises project for the
whole country (93% of premises, plus rural 7% on wireless), then a
conservative government got in power and decided to deliberately destroy it.
To do this, they changed it to fibre-to-the-node (DSL) instead. Instead of
gigabit to the home, they're spending more money providing people with
connections anywhere between 4mbps and 100 at the absolute most, with no
possibility of upgrades. The cost to do this, is, of course, far more money in
the long term than installing the fibre. Some people in metropolitan areas
will get connected to the existing coaxial network, which is going to have
huge contention problems as it's stretched far beyond what it was ever
intended for.

It's the biggest trainwreck of an infrastructure project in Australia's
history and will set every person and business back for decades, and the blame
lies squarely with the Liberal Party.

The current head of the project has gone on record saying that Australians
don't want fast internet and wouldn't use it if it was free.

~~~
Retric
Wait, if the Conservative party decided to destroy it how is that the fault of
the Liberal Party?

~~~
redcap
The Liberal party is the conservative party. No Conservative party in
Australia AFAIK.

The Liberal party is broadly social-conservative, pro-business.

The Labor party is broadly speaking socially liberal and pro-labour.

~~~
cknight
You're on the money, but just a bit out of date. We have a (very) new far-
right party called the Australian Conservatives now. The creation of a former
Liberal party senator.

~~~
Sag0Sag0
Ahh, make australia great again.

------
dis-sys
I lived in Australia for 12 years, they fed me fake news about the progress of
the NBN on weekly basis. In the end, they didn't deliver it at all - I was
living in Sydney's inner city suburb but there is no way to get it 10 years
after the promise was first made.

Moved back to Shanghai in 2017, was really happy about the fact that CCP
didn't play the same game, they deliver concrete results. 500Mbps fiber costs
me $450/year, with an extra $20/year, I can screw the GFW - streaming 4k from
youtube is easy and I am watching it now.

I really like the fact that there was no general election topic or endless +
meaningless debate on whether such a fiber network is good or not, CCP just
deliver what they believe is good and take responsibility from there. Life is
short, how many 10 years you have to waste on craps like that?

It is also worth pointing out that in Chinese definition, wasteful spending on
tax money is serious corruption, you'd be seeing trucks load of CCP officials
sent into jail should they dare to spend $49b without delivering the network
on time.

------
andrewstuart
In Australia, the Liberal party leadership is clever enough to design national
computer communication networks. Wait.... no they're not even close to that
clever. But it doesn't stop them anyway.

What we can be sure of it now that Tony Abbott and Malcolm Turnbull have
completely ruined our chance at having a world class NBN, they'll not do what
is needed to actually make it world class.

It's really strange that politicians simply are not driven by making things
awesome. They're driven by something else and it's certainly not the goal of
getting to the best possible outcome for the people and the country.

So I have HFC coming into my home right now.... where is my symmetric 10Gbps
connection?

[https://www.nbnco.com.au/blog/industry/hfc-what-is-full-
dupl...](https://www.nbnco.com.au/blog/industry/hfc-what-is-full-duplex-
docsis-3-1.html)

I loathe politicians with the burning heat of a thousand supernovas.

~~~
gonzo41
Don't waste that anger. Vote left (Or at least be very careful with your
preference flows) at the next election. And get everyone you can to start
talking/pushing for a Royal Commission into this.

~~~
andrewstuart
I loathe all politicians including the left wing. I just loathe the right wing
more.

None of them represent the citizens. They represent their own grasping self
interest.

And I certainly don't agree with the far left who seem to have an anti
corporate/anti capitalist whiff to them ... I'm a committed capitalist AND
green and they is no political party aligned to that.

~~~
mmerlin
Sick of politicians?

Sustainable Australia party is who you're looking for. William Bourke is
eminently sensible. Dick Smith joined. The anti-corruption fighter who wrote
"Game of Mates" Dr Cameron Murray is running for them too.

[http://www.sustainableaustralia.org.au](http://www.sustainableaustralia.org.au)

[http://www.sustainableaustralia.org.au/qld](http://www.sustainableaustralia.org.au/qld)

~~~
Benjamin_Dobell
Unfortunately, Dick Smith's reputation has been somewhat tainted by getting
involved with a racist national disgrace:

[http://www.sbs.com.au/news/article/2017/08/17/hanson-dick-
sm...](http://www.sbs.com.au/news/article/2017/08/17/hanson-dick-smith-meet-
over-capping-immigration)

~~~
mmerlin
Somewhat, although he backed away from One Nation after Pauline wore a Burka
in parliament.

It's a shame the media has conflated any discussion of an immigration policy
with racism (ie because of One Nation)

Dick's not running though, so checkout the candidates and party, they are
academics and scientists for the common good.

------
shmerl
_> After the conservative government attained power in 2013, the NBN struck
more upheaval, with copper wire ordered for the final stretches of connection,
surrounding neighbourhood broadband nodes._

How would pulling copper make it any better? It surely couldn't make it
cheaper and at the same time would only use an inferior technology. Why would
anyone pulling a new network today use anything but fiber optics?

~~~
stephen_g
They're trying to use existing copper for most of it, but as predicted by all
the experts it's not working (the Government promised 50Mbps to all and up to
100Mbps but many people only get ~35Mbps - of course, the parts done by the
old Government are capable of gigabit), and the cost has blown out by more
than $15bn anyway... So yeah, should have just stayed with the fibre.

------
burntrelish1273
Reminds me of Dave of EEVblog (in AU, obviously) discussing about how stupid
the pricing, bureaucracy and outdated are on various, overlapping internet
service providers, especially NBN.

[https://youtu.be/haImi4cWau0](https://youtu.be/haImi4cWau0) (2017)

[https://youtu.be/nJxQZr4dz3g](https://youtu.be/nJxQZr4dz3g) (2014)

------
gumby
The BBC blamed, in part, "Australia's preference for underground wiring" as if
it was a fashion statement.

In reality Britain simply lacks serious termites (and is in general
underequipped in terms of dangerous animals, if you use Australia as a
baseline).

I think this article buries the sins of the Liberal party (though the whole
problem cannot be laid at their feet). I still have hope she'll be right in
the end.

------
DigitalSea
I truly fear the day the NBN comes to my area. I am currently with Telstra and
fortunately have HFC, I get pretty reliable speeds between 112 and 115mbps,
with ping of 9ms. I am a developer and I rely on my currently decent
connection to make money, video call clients in other countries, transfer
large files (to and fro) if speeds were to suffer resulting in the inability
to communicate properly, it would be crushing.

The fact that retailers are not purchasing enough bandwidth means you're
buying a Ferrari with a broken engine that is being pulled by a single horse.
My area is slated for NBN 2019, let's hope they do something about the
bandwidth before then (apparently at an estimates hearing a solution was
promised by Christmas this year). What a joke.

~~~
neumann
Really? What's your up rate? I am with Telstra HFC and get 2Mbps on the upload
on home plan. NBN gives 40Mbps.

~~~
DigitalSea
Telstra with added speed pack gives me 115mbps down and 2mbps up. I actually
get a little over 2mb though. If I go onto the NBN and the bandwidth issues
aren't sorted out, you can have the fastest speeds all you want but still
experience ADSL speeds during peak congestion.

------
loa_in_
> In 2013, Australia ranked 30th for average internet speeds. The NBN was
> meant to improve that, but the most recent standings ranked Australia 50th.

Well, I'm pretty sure 50th place today is a lot better than 30th back then
still. They might not have the best internet around, but it probably got
better for the users in that timespan. It smells to me like typical misused
statistics in search of click-earning controversy.

~~~
jaredklewis
How is this misusage of statistics? Given that internet speeds are a moving
target, it really only makes sense to compare with other nations. If Australia
doubles their internet speed that's great and all, but if the rest of the
world makes a 10x improvement, sure doesn't seem like much of an
accomplishment.

------
porjo
Running FTTH to every home was always a pipe dream (excuse the pun). Some kind
of technology mix was a necessary compromise _however_ the balance is wrong -
percentage of FTTH is way too low. My home town is literally (and
inexplicably!), divided down the middle - one half with FTTH, the other FTTN.

~~~
JauntyHatAngle
>Running FTTH to every home was always a pipe dream (excuse the pun).

Why do you say this?

~~~
porjo
Because of the astronomical cost involved in running fibre to _some_ premises.
And not even talking about city vs bush - two city dwellings in close
proximity can have vastly different cost of installing fibre.

I would qualify my original statement with 'as part of a NBN-like project'. I
didn't intend to suggest that not every home should have fibre, or in deed
will have fibre at some point in the future, just not at the tax payer's
expense.

------
vazamb
I will be moving to Melbourne next year. What kind of internet speed can I
expect, what areas should I be looking at for a good connection at home? I
currently have 200/20 in Berlin, presumably will need to downgrade my
expectations...

~~~
boyter
Depends on the area but expect 10 Mbps or less. NBN has not really moved into
capital cities yet. I am looking forward to them rolling out FTTN connections
on copper laid 50 years ago and insulated using newspaper. Even if you get an
area with NBN keep in mind they are not obligated to provide more than 12 Mbps
during co existence and 25 Mbps after. With 5 dropouts a day considered
acceptable service.

If you can find a unit with TPG FTTN go with that. It will be cheaper and
uncongested.

------
rayiner
It’s interesting to compare Australia’s grand experiment with Stockholm’s.
Australia’s proposal, before retrenching, was 93% coverage at 100 mbps (later,
one gigabit), with a government investment around $30 billion AUD. Completion
was promised on an eight-year timeline.

Stockholm, in comparison, followed a very different model:
[https://www.stokab.se/Documents/Stockholms%20Stokab%20-%20A%...](https://www.stokab.se/Documents/Stockholms%20Stokab%20-%20A%20Blueprint%20for%20Ubiquitous%20Fiber%20Connectivity%20FINAL%20VERSION.pdf).
A city owned company was created. No public money was contributed; the network
was financed by the utility taking loans. The government imposed no coverage
requirement. Service was expanded based on demonstrated demand, and it took 17
years to cover 90% of the city. The utility started turning an overall profit
in 2008, after 13 years of operation. The Stockholm system is expensive--
customers are charged a set-up fee to recoup construction costs, and although
prices must be transparent, they are not rate-regulated. NBN Co., in contrast,
is subject to rate regulation and does not recover construction costs as part
of a setup fee.

Broadly speaking, there are three lessons to take from this:

1) Urban areas and rural areas should not be part of the same program.
"Universal service" sounds nice in theory, but in practice the challenges of
deploying in rural areas can torpedo the project. In Sweden, the government
_did_ help deploy fiber in rural areas:
[http://www.ftthcouncil.eu/documents/Opinions/2013/Rural_FTTH...](http://www.ftthcouncil.eu/documents/Opinions/2013/Rural_FTTH_Nordics_Final.pdf).
Sweden required dark fiber to be deployed to within a few kilometers of rural
areas, but rural residents had to pay for their own hookups. The government
subsidized 50% of the cost of those hookups, up to about $600 USD per
property.

2) Coverage requirements are a bad idea. When you force the operator to cover
areas where the business case doesn't yet exist, you're forcing them to charge
their existing customers more to subsidize new customers. That can make the
product too expensive for existing customers.

3) It's okay for fiber to be expensive, at least at first. Charging more to
early adopters to recoup large fixed costs is a basic business model in the
tech industry. Telia in Sweden charges about $120/month for gigabit, and in
many cases customers are liable for construction setup costs. That's okay--it
allows the operator to quickly recoup construction costs and use ongoing
revenues to expand the network. Sweden does not regulate rates to make fiber
affordable for poor people, nor does it force fiber operators to subsidize
service themselves.

------
vacri
So here's my tale of what happened:

Party A was in power, and having infighting problems. Party B was headed by an
absolute arse of a man, who used the tactic "Say No! to EVERYTHING". Didn't
matter how benign or banal, the opposition party would say no. A flagship
policy like the NBN was particularly focused on - and if you look at
interviews with the opposition communications minister at the time (now our
prime minister), it was clear that he was toeing the party line and didn't
think changing the policy was a good idea.

Fast-forward to the next exection, and Absolute Arse gets into power. Turns
out he can't govern at all (despite 20 years on the front benches) and he
definitely isn't going to backtrack on something he's attacked so routinely.
He's kicked out by his own party. At this stage, the NBN has been gutted, and
its doom is sealed.

In steps the comms minister as the new PM, but he is now beset by
factionalism. He knows what a turkey the NBN is, but he doesn't have the
political power to do an about-face on his party's policies.

In short, we're fucked. By the time any other party can get in, the NBN will
be 'mostly complete'. The most annoying thing is that the folks who really
need good internet is business, not residences (think graphic design, medical
imagery, etc), and the party that fucked the NBN is the 'party of business'.
Enterprises can already dictate their own network backbones, but small-to-
medium businesses cannot.

~~~
prawn
"Enterprises can already dictate their own network backbones, but small-to-
medium businesses cannot."

Before that election, I can remember having an argument about the need for the
NBN with a friend who works for a very large company. He argued that the
internet in Australia was fine because their teleconferencing video in the
boardroom worked well. I told him that not only would they have had a very
specialised connection, that in the very near future, households would see
multiple, concurrent, hi-res video streams, and that business demands would be
high too.

We're a home of four. It's not uncommon for the kids to be streaming Netflix
while I work (with a basketball stream running), and my wife uploads large
photos and streams a TV show on her phone while she works. We're still a year
away from getting NBN and our internet absolutely crawls.

