Commentators pan 'uncompetitive' NBN plan

Commentators claim NBN Co’s corporate plan based on flawed assumptions

A number of Australia’s most senior business and economics commentators have opened fire on Labor’s flagship National Broadband Network project, claiming NBN Co’s corporate plan released on Monday was based on flawed assumptions and demonstrated the project would wind back competition in the telecommunications sector.

University of Melbourne economics professor Joshua Gans claimed on his blog that the nation should be “outraged” by a clause in the NBN plan which states that if NBN Co did not sign a deal with Telstra to transfer the telco’s customers to the NBN and shut down its fixed broadband networks, then it was “likely” that one or both of the country’s HFC cable networks (the other one is owned by Optus) would be upgraded to allow speeds of up to 200Mbps in competition with the NBN.

“We should be outraged at this. More to the point the Australian Competition and Consumer Commission should be outraged with this. Where is Graeme Samuel on this?” demanded Gans, pointing out the clause constituted a “clear statement” that three broadband networks would change into two or even one as a result of the NBN rollout.

“This is as substantial a lessening of competition from an agreement that we can imagine,” he added. “And yet our independent competition regulator — whose independence is there because government business entities are subject to the Trade Practices Act — appears to have abdicated its role.”

Business Spectator columnist Stephen Bartholomeuz — one of the nation’s longest-standing and most respected business commentators — picked holes in NBN Co’s financial reasoning in several articles on the matter.

“If the actual NBN Co performance over the period 10 to 30 years out actually looks anything remotely like the business plan it would be a miracle and Mike Quigley would emerge as a 21st Century Nostradamus,” he wrote.

Veteran business journalist Matthew Stevens, who writes for the Australian, was even harsher on the NBN. “Love it or loathe it, the unavoidable fact is that the NBN business case is pretty miserable,” he wrote, bringing up many of the same points as Bartholomeuz in discussing the cost of capital required to build the NBN in relation to the company’s calculations on its financial return.

Communications Day publisher Grahame Lynch is more concerned about the real impact of NBN Co’s multifaceted pricing approach, which is a bit more complicated than the “$24 per month” headlines suggest. However, Lynch is also concerned about competition. “I suspect that while the NBN may achieve many things it will not make a thousand competitors bloom,” he writes.

However, not everyone was as negative about the NBN’s prospects, with Business Spectator columnist Alan Kohler leading the case for the affirmative in several columns on the matter. He wrote yesterday:

“Not only will the NBN not be a white elephant it will almost certainly prove to be a great investment. In fact, without wishing to get carried away (too late do you think?) it could represent, on its own, a huge national savings plan. When it’s finished the asset will be worth several times the government’s investment of $27.5 billion.”

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags commentarycolumnistsgrahame lynchalan kohlerStephen Bartholomeuzbusiness spectatorjoshua gans

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Renai LeMay

Good Gear Guide
Show Comments

Essentials

Lexar® JumpDrive® S57 USB 3.0 flash drive

Learn more >

Microsoft L5V-00027 Sculpt Ergonomic Keyboard Desktop

Learn more >

Mobile

Lexar® JumpDrive® S45 USB 3.0 flash drive 

Learn more >

Exec

Lexar® JumpDrive® C20c USB Type-C flash drive 

Learn more >

Audio-Technica ATH-ANC70 Noise Cancelling Headphones

Learn more >

Lexar® Professional 1800x microSDHC™/microSDXC™ UHS-II cards 

Learn more >

HD Pan/Tilt Wi-Fi Camera with Night Vision NC450

Learn more >

Budget

Back To Business Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Ed Dawson

HP OfficeJet Pro 8730

As a freelance writer who is always on the go, I like my technology to be both efficient and effective so I can do my job well. The HP OfficeJet Pro 8730 Inkjet Printer ticks all the boxes in terms of form factor, performance and user interface.

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?