Shadow communications minister and former finance boss Nick Minchin has labelled Australia's $4.7 billion taxpayer-funded National Broadband Network (NBN) an uneconomical pipedream, three days before the lucrative tender closes.
Minchin, a Liberal Party veteran, said it is impossible to deploy a fibre network to 98 percent of Australia, and blamed weak NBN policy for a recusant Telstra which has refused to bid under the tender conditions.
“Labor cannot possibly deliver on its key commitment to build the NBN within five years and nobody seriously believes building a Fibre-to-the-Node network to 98 per cent of Australian homes and businesses is an economically viable or realistic proposition,” Minchin said in a written statement.
“[NBN] doubts have been intensified by the refusal of the owner and operator of the existing legacy network, Telstra, to even bid, due to Senator Conroy’s failure to clarify fundamental aspects of his own policy.”
Telstra has refused to bid for the NBN unless structural separation — which has fuelled the NBN for a year — is ruled out. Minchin told a Sydney meeting he does not support separation because the chance has passed to carve up Telstra now that it is privatised.
Contrary to arguments by Telstra NBN rival Terria, Minchin said Telstra will never structurally separate. AAPT chief executive Paul Broad said market pressure will force the NBN operator to structurally split.
Minchin said the venture does not require taxpayer funds. He said he is “suspicious” of private ventures funded by tax payers.
Terria head and former NSW state treasurer Michael Egan told Computerworld the NBN would be jeopardised if Telstra was to build a parallel fibre network in the event that Terria wins the tender.
“There can only be one national fibre network in a country with the size and population of Australia, if you insist that the network covers the whole country with nationally consistent pricing,” Egan said.
“Only one would be left standing in the event of an overbuild and the network would be the play thing of whoever owned it.
“A [cherry-picked] overbuild would be similar to the problems in pay TV; some areas would have duplicate services, and others would have none.”
Minister Conroy told a meeting at the American Chamber of Commerce the NBN process would have been hindered if regulatory policy was decided beforehand.
“Our view, as I have stated previously, is that prescribing specific regulatory settings at the start of this process would have unnecessarily narrowed the scope for innovation and competitive tension,” Conroy said.
“When we put $4.7 billion on the table to invest, we anticipated, and encouraged this debate. It is fair to say that we have not been disappointed.
“But the government is focused on outcomes in the NBN process, not regulatory totems.”
The NBN bids will be assessed over the next two months while the Australian Communications and Media Authority will recommend a regulatory framework.