Abbott: Telstra "bought, not convinced" on NBN

By Ry Crozier on Sep 15, 2010 11:03 AM
Filed under Telco/ISP

Hopes to change independents' minds.

The Opposition has stepped up its attacks on the National Broadband Network by claiming Telstra had been "bought, not convinced" of the project's merits.

Appearing on ABC Radio's AM program, Opposition leader Tony Abbott also revealed the Coalition planned to convince independent MPs to reverse their support for the NBN and back the Coalition into power.

"There's no reason whatsoever why there couldn't be a baton change at some point early in the Government's term," Abbott said.

"I think [convincing the independents to shift is] what we should be doing and with someone like Malcolm [Turnbull] in charge of communications policy, in charge of exposing the waste and extravagance inherent in the Government's broadband plans that becomes a very real prospect."

The comments prompted Greens communications spokesman Scott Ludlam to issue a warning to the Coalition.

"Holding the government ferociously to account is one thing," Ludlam said.

"Using a crucial infrastructure project like this as a platform to bring down a minority government is another."

Independent MPs Rob Oakeshott and Andrew Wilkie reportedly indicated to The Australian that they would not be swayed to change sides.

Abbott also cast doubt this morning on suggestions that Telstra was "on board" with the NBN despite the multi-billion dollar draft heads of agreement between it and NBN Co.

The long form of that agreement was now expected before mid-November.

"I'm not sure that Telstra have been convinced," Abbott speculated.

"They've been offered $11 billion, so I think they've been bought not convinced."

Abbott: Telstra "bought, not convinced" on NBN

42 comments in this discussion

"RJ wrote: "I sure hope not, but the other options doesn't look good either (because it means only the people that afford and need Fibre would get it, which means we are back to square one and ..."

By deteego

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Comments: 42

ITnovice Sep 15, 2010 12:00 PM	Would somebody please tell Tony Abbott that the election is OVER! If he wants to look for spending waste look at the BER instead. He lost the election partly due to his crap inferior broadband plan and has apparently learnt nothing from that experience. The last thing i want is him or Malcolm Turnbull on the news every night ranting about the NBN which is being properly managed (so far) by the NBN Co
Jovial Monk Sep 15, 2010 1:06 PM	Did ITNews ask Conroy to comment on this crap? Always nice to get a balanced picture!
noelpeters Sep 15, 2010 1:16 PM	The real game breaker will be the cost benefit study. When it is released Telstra shareholders will have no option but to reject the deal. NBN as proposed by Labor is not economically or operationally viable. The study will show this when finally released. NBN will be another Labor backflip and failed election promise.
Jack Cornell Sep 15, 2010 2:21 PM	The government is getting nowhere fast with the NBN. Telstra is VERY unconvinced. Governments cant run anything that has a business component attached to it. If politicians had business acumen they would be in business, not spending their lives in endless meetings plotting against rival factions. At the end of the day, and how blindlingly obvious this is , just pick up the 'phone to David Thody and say "How about YOU building the NBN, and running it, and paying for it." Telstra has mountains of cash, and massive income. And as soon as the first small roll-out of the Telstra-built NBN starts generating more cash this will pay for the on-going roll-out nation-wide of the NBN. Furthermore it obviously cannot be all fibre to the home. Much will be, but not all. In a huge country like Australia, wireless comes into it. END OF STORY.....................THIS IS IT !!!!
Bazwalt Sep 15, 2010 2:24 PM	@Jack Cornell - Do you work for Telstra?
Bazwalt Sep 15, 2010 2:27 PM	@noelpeters - And what qualifications or experience do you have that justifys you to make such a statement that it is not economically or operationally viable? The NBN is in its infant stages and already your condemning a project that will bring us to and lead us through the next century. Either find us a better solution or stop complaining. If you can't bring anything of equal benefit to the table than you have stance on the matter.
Bazwalt Sep 15, 2010 2:39 PM	@noelpeters- I understand and respect your opinion on the matter and I will admit that my above comment was a tad direct - but if you're going to complain at least offer something of equal benefit to the table so we can really see how much of a failure that NBN actually is.
Rondo Sep 15, 2010 3:12 PM	Guys, can anyone tell me how much will this fancy NBN cost me every month? Will I be able to use it or is it intended for my grand grand children? If this project is so much on track, on budget and to "Customer's satisfaction" how come we know so little about the details?
Rondo Sep 15, 2010 3:33 PM	I don't think the ALP thought the NBN through properly. It does not make sense to announce the whole project in one go. They should have this project broken into phases (not as per their maps) and focus on general fibre infrastructure rather than fibre to every home and only feed fibre into desired premises. To illustrate this, my 80 years old neigbour can hardly use her phone. If fibre in her home can do the house keeping she would definitely need it!
rodzilla Sep 15, 2010 3:39 PM	Stupidity - thy name is Tony Abbott! If the Clown Prince gets his way, Australia will stay on Third World Internet forever!
Rondo Sep 15, 2010 3:43 PM	Rodzilla, I have had ADSL 2 foor some time now and it is running extremely fast (compare to ADSL 1). Maybe there is a need to jack up certain areas of the country. What would I do better with fibre that my ADSL 2 cannot deliver?
Mikeinnc Sep 15, 2010 3:48 PM	@Rondo, perhaps it is time you - and we all - started to look at the NBN in a different way. Currently, you probably have a copper telephone line to your house. This is part of the vast copper network that has been in place for in excess of 70 to 80 years. Recently, Telstra - who own that network - have not been maintaining it. That is understandable. It has reached the end of its economic life. Why would you throw good money after an obsolete asset? In addition, copper has a finite bandwidth capacity. In most cases around Australia, we have reached that. In other words, when - and it will be when, and not if - we want faster access in the next 10 - 20 or more years, we wouldn't be able to achieve it. The NBN will replace that copper with fibre. It is quite likely that the broadband (ADSL) access you now have will be available and cheaper with fibre - cheaper since you will get the same broadband access - same speed; same download limits, probably - but it will likely include all your phone calls as well. If that is all you currently need, so be it. However, when those same great-grand children you describe demand 100Mbps, or greater, in 30 years time, that same fibre will still be there to provide it. Fibre provides the headroom for faster access for about as far as we can see into the future. That's what the NBN is about. Today AND tomorrow - and 30 or 40 or even 50 years into the future.
Rondo Sep 15, 2010 3:57 PM	Mikeinnc, you must have missed my point. I clearly stated that there is a need for Fibre infrastructure and not fibre into the home right away. If you understand economics, it does not make sense to replace ADSL 2 until the Fibre grid is completed. I am paying big taxes and seek to see value for money. $43 billion dollars can do a lot for many people at various age groups thus investing this money in a project that is not even costed properly is a huge mishandling of fublic funds. I asked a question about the monthly fee. Do you know how much will it be?
Willtry Sep 15, 2010 4:23 PM	noelpeters are you the same who works in field of Climate Change . Tony Abbott is a sore loser ok Labor won on a very small margin but they won why undermine the gov of the day. Sound like a small child who sulks and plots revenge because they lost. Get a Life Tony
RDEFCON1 Sep 15, 2010 4:36 PM	@Mikeinnc - "...but it will likely include all your phone calls as well" And just where do you get this totally unrealistic supposition from? Why on earth would you build a fibre network today so that you can deliver the same services for less? If we don't need the network until tomorrow, don't spend the money on it until tomorrow! Would you buy a new car today that you won't need until 10+ years from now? The ONLY good thing about the NBN is that it will address areas that are not being served by modern broadband today. NBNco could focus on these areas and slow down the rollout elsewhere until it was needed, and save the taxpayer a fortune.
noelpeters Sep 15, 2010 4:37 PM	Bazwalt why do you think the Government haven't carried out or released a business plan or cost benefit analysis for the NBN.
Rondo Sep 15, 2010 4:43 PM	RDEFCON1, I am glad there are people like you who understand how business works. If I ask my boos for money, I will need to have a good case before something will even be considered. I am looking forward to read something about the NBN to convince me that my money is well spent. Many people voted for the ALP because they thought the NBN will be delivered by Father Xmas. Well, Xmas is just around the corner and unfortunately, there is no NBN for the kids this Xmas!
RDEFCON1 Sep 15, 2010 4:53 PM	@Rondo - see 'nbnoptions.org' and sign the petition. I was referred to this site earlier today and am very glad to see a movement supporting a real analysis and debate of the alternative options available to Australia, even with NBN in the mix.
noelpeters Sep 15, 2010 4:59 PM	Willtry - no.
Gavk Sep 15, 2010 5:31 PM	@Rondo - The pricing is very generous, check out iinet.net.au/nbn/ Broadband pricing starts at $29 for 20GB quota @ 100Mbps, 200GB is $49, Pay TV pricing at $19, and Phone with UNLIMITED NATIONAL/LOCAL CALLS is $9 FTTH is not just about broadband, look at all the poor sods paying $100+ per month for Foxtel as it is essentially the only Pay TV provider, even the entry package with stuff all channels is like $50 a month. What about the guys paying Telstra $80+ for a phone service with unlimited calls? iiNet will do that for $9 over the NBN. There is also loads of other things, for example internet fire alarms that will call for help if it detects a Fire, internet burglar alarms. The reason not many are sold on the NBN is because they only think it is about broadband, they don't see the other benefits. If you instead asked; Do you want unlimited calls for $9? Do you want Pay TV from $19 with a bunch of on-demand movies? I think the answer would be alot more positive. Just for example, Telstra's phone plan with unlimited calls is $89.90 - you could get unlimited phone, Pay TV, 400GB Broadband for that...
Tailgator Sep 15, 2010 5:54 PM	Of course Telstra is unconvinced. They want to hang on to their cosy privately owned fixed line monopoly. If that's the best Abbott can do, then thank (insert deity) that he didn't win the election.
epimetheus Sep 15, 2010 6:22 PM	Obviously Bazwalt has as much knowledge of Socialist stupidity as he does of the English language! I would suggest he study history, particularly in regard to Labor parties worldwide. Perhaps then he will know something of the subject under discussion. Mind you most rabid Labor supporters would still support those with the morals of alley cats regardless. noelpeters is correct in his estimate. The cost suggestion of Gillard and her uneducated union hacks would hardly supply internet to a big city, let alone the whole country.
djzort Sep 15, 2010 7:08 PM	cancel the NBN. put in place serious tax breaks for infrastructure projects in underserviced areas. watch the private sector throw out coverage over night and the government wont spend an actual cent!
Maxxi2 Sep 15, 2010 7:36 PM	GavK makes a good point, why is then that all the experts who claimed FTTH was unworkably expensive and at Rolls Royce prices are not quoting amd listing the iinet NBN packages? They all do want to only tell the truth and the whole story, right? By the predictions of the experts, iinet will be broke and destitue in around 3-6 months, as NBN servcies at that pricing are totally unworkable, cannot be supported and will sned all of Australia broke, not just iinet. And these experts know so much more about the NBN packages and ISP pricing than iinet, clearly. Otherwise they would be wrong and iinet would not be offering NBN packages at these prices? Now to switch over to the channel showing ISP mega-expert talking about the white elephant NBN, the massive pricings and naturally about how he knows more than Michael Malone and his crew... Should be a good show.
deteego Sep 15, 2010 8:24 PM	Maxxi2 wrote: GavK makes a good point, why is then that all the experts who claimed FTTH was unworkably expensive and at Rolls Royce prices are not quoting amd listing the iinet NBN packages? They all do want to only tell the truth and the whole story, right? By the predictions of the experts, iinet will be broke and destitue in around 3-6 months, as NBN servcies at that pricing are totally unworkable, cannot be supported and will sned all of Australia broke, not just iinet. And these experts know so much more about the NBN packages and ISP pricing than iinet, clearly. Otherwise they would be wrong and iinet would not be offering NBN packages at these prices? Now to switch over to the channel showing ISP mega-expert talking about the white elephant NBN, the massive pricings and naturally about how he knows more than Michael Malone and his crew... Should be a good show. I think you need to put your reading glasses on. We are talking about the costs to the government as well as the licensing costs. If not that many people end up using NBN, the government still has to maintain the NBN at a massively inefficient rate (i.e. they will end up losing money). That means they will either pass the costs for licensing the NBN to telcos (which means it wont be any more affordable then it is now) or it will create a massive debt to the country
Mikeinnc Sep 15, 2010 8:36 PM	@Rdefcon1 - "And just where do you get this totally unrealistic supposition from?" Well, strangely, I've done some research which seems to be something you haven't. Just trot out the same tired old crap that goes round and round. Never an original thought anywhere.... Currently, iinet offers a number of naked DSL plans that include local and national phone calls. That is because voice calls are almost superfluous on a high speed data network, and the marginal cost to provide them is negligible. Of course, Telstra won't tell you that - they make an absolute killing from voice traffic. Since , by definition, ALL calls on the NBN will be packetised (or VoIP to use a common term), the cost to provide them will be, if anything, even more insignificant. Why wouldn’t you offer them inclusively? Sounds like a pretty good marketing philosophy to me - and iinet as well, I'd guess! Your comment about buying a car is churlish, and laughingly ridiculous. Comparing infrastructure with a short term, depreciating personal asset tells me that you haven't got a clue. I'd think that building a major infrastructure project, which involves massive civil engineering, and is thus likely to take many years to complete (and, no, that is not a criticism - it is a reality that you choose to ignore) is best done as soon as possible. One thing is certain. It won't be cheaper tomorrow! Of course, I guess we could always wait until the current network is totally stuffed and then start thinking about it. Bit like waiting for the wheel to fall off that car I didn't really need.....
deteego Sep 15, 2010 8:46 PM	Mikeinnc wrote: @Rdefcon1 - "And just where do you get this totally unrealistic supposition from?" Well, strangely, I've done some research which seems to be something you haven't. Just trot out the same tired old crap that goes round and round. Never an original thought anywhere.... Currently, iinet offers a number of naked DSL plans that include local and national phone calls. That is because voice calls are almost superfluous on a high speed data network, and the marginal cost to provide them is negligible. Of course, Telstra won't tell you that - they make an absolute killing from voice traffic. Since , by definition, ALL calls on the NBN will be packetised (or VoIP to use a common term), the cost to provide them will be, if anything, even more insignificant. Why wouldn’t you offer them inclusively? Sounds like a pretty good marketing philosophy to me - and iinet as well, I'd guess! Your comment about buying a car is churlish, and laughingly ridiculous. Comparing infrastructure with a short term, depreciating personal asset tells me that you haven't got a clue. I'd think that building a major infrastructure project, which involves massive civil engineering, and is thus likely to take many years to complete (and, no, that is not a criticism - it is a reality that you choose to ignore) is best done as soon as possible. One thing is certain. It won't be cheaper tomorrow! Of course, I guess we could always wait until the current network is totally stuffed and then start thinking about it. Bit like waiting for the wheel to fall off that car I didn't really need..... You do realise that NBN is basically giving away the Fibre Internet (currently) for free (there are no wholesale prices, so it doesn't cost ISP's anything to use the NBN). With the above in mind, using the following plans available for NBN http://www.iinet.net.au/nbn/ http://www.iprimus.com.au/PrimusWeb/HomeSolutions/FibretotheHome/ http://www.internode.on.net/residential/broadband/fibre_to_the_home/nbn_plans/ For that "lovely" 100mbit to a house, iiNet (with an offer they just released, normally it would be 25 mbit) they are standard ADSL2 prices. However the other telcos (internode, iPrimus) it appears to be around 50% more expensive then ADSL2+. Keeping in mind, they are getting this infrastructure for free during the trial, this is not going to happen when NBN is released (and they have to PAY for it)
Mikeinnc Sep 15, 2010 8:59 PM	@deetgo - if you had read my post, you would have seen that the naked DSL plans are actually on copper. I didn't mention the NBN at that point .... which I guess you might have known since DSL is not a fibre technology. You did know that, didn't you? And another thing that everyone overlooks is that you'll probably initially be able to buy a 25Mbps fibre plan at the same price you pay for a 25Mbps (copper) DSL plan now. I don't think anyone ever suggested that you'd get four times the speed for the same price. It WILL happen - competition and natural attrition will see to that, just like quotas have increased on copper. Rome wasn't built in a day! Why can't you see that this is a l-o-n-g term infrastructure project. Stop just looking at the short term. Change will be incremental - and fibre can host it.
Rondo Sep 15, 2010 9:55 PM	I can almost guarantee that when the NBN project is completed (I nice dream to have) there will be chaos amongst the Telcos. Telstra is the only Telco who is capable of buying the NBN Co, thus we are all back to Square One. It is better if Telstra do the NBN rollout, own it and provide ISPs with the services. I cannot see "virtual Telecos" like iinet, iPrimus, etc. providing acceptable service levels. So the time bomb is ticking for chaos. My understanding is the Fiber is converted to Ethernet in the homes. So telephony as we know it at home turns digital. We need IP phones (expensive) and LAN to run other computers and phones. Is this the right assumption? Does anyone know anything about the Fibre box NBN is supplying to houses? Does it have WiFi? What else can it do?
Mordd Sep 15, 2010 10:14 PM	A few comments to throw in the mix: * Local and National calls will probably be included free with most plans once the NBN is completed, for the reasons Mikeinnc has already explained. * The prices we are seeing at the moment are only staring prices, and they will come down over time. ADSL was horrendously expensive when it first came out and now is quite cheap, the same thing will occur with the NBN. * The prices we are seeing though are at most the SAME as current ADSL2+ prices, not more expensive. So to use that as a base, when the NBN is complete you will pay at most the SAME as you currently paying, but some of your calls will most likely be free, and you'll have bigger quotas. Thats the worst case scenario. At best it will be cheaper, with some free calls, and much much bigger quotas. * Lastly, if you want to compare the NBN to anything, compare it building the Perth to Adelaide railway link, which at the time cost 1/3rd of South Australia's GDP to build, and has more than paid for itself since then. The NBN is an infrastructure project, comparing it with anything other than another infrastructure project is like comparing bananas with sausages.
Mordd Sep 15, 2010 10:16 PM	Rondo: "Telstra is the only Telco who is capable of buying the NBN Co, thus we are all back to Square One." Where on earth do you come up with crap like that? You really have no idea what the plan is for NBN Co once the project is completed do you. Before you spout more crap on here please go and do your homework if you want to contribute to the debate, ta.
Mordd Sep 15, 2010 10:18 PM	Rondo: Does anyone know anything about the Fibre box NBN is supplying to houses? Does it have WiFi? What else can it do? 1. No that would be your ISP, not NBN Co who is the wholesale provider. 2. No, it won't have anything, it will be a box on the outside of your house, probably in the same box your telephone stuff is housed in currently, maybe a new box. 3. It doesn't do anything else, again NBN Co is the wholesale provider, not an ISP. As above, do your homework for gods sake.
shanic Sep 15, 2010 10:53 PM	This is why I dont like abbott, he has nothing intelligent to offer, just speculation and FUD (Fear, Uncertainty and Doubt) I am glad he isn't running the country, turn everyone into mindless idiots. Oh hangon already sounds like liberal supporters!
Rondo Sep 15, 2010 11:58 PM	Mordd, Thanks for the update. I am a Tax payer not a NBN researcher. Since we are talking Tax payer's money it is the Government's obligation to provide all the information in one place. I looked at the NBN Co website and I thought is is largely a joke. NBN Co will be up for sale at the end of the project (if we ever get there). The amount of money involved is the reason why I came to the conclusion that Telstra, or a consortium, is the only entity who is capable of paying for this.
Rondo Sep 16, 2010 12:06 AM	Shanic, $43 Bilion looks like this: $43,000,000,000. This is a lot of money to be cynical about. If Labour said they will only spend $10 bilion in the next 3-5 years the Liberals will not be arguing the figure so much. The problem is that there are many other priorities that should be considered. It looks like the sky is falling down and the NBN must be priority #1. At least it looks so in the ALP's books.
deteego Sep 16, 2010 12:11 AM	Mordd wrote: A few comments to throw in the mix: * Local and National calls will probably be included free with most plans once the NBN is completed, for the reasons Mikeinnc has already explained. * The prices we are seeing at the moment are only staring prices, and they will come down over time. ADSL was horrendously expensive when it first came out and now is quite cheap, the same thing will occur with the NBN. * The prices we are seeing though are at most the SAME as current ADSL2+ prices, not more expensive. So to use that as a base, when the NBN is complete you will pay at most the SAME as you currently paying, but some of your calls will most likely be free, and you'll have bigger quotas. Thats the worst case scenario. At best it will be cheaper, with some free calls, and much much bigger quotas. * Lastly, if you want to compare the NBN to anything, compare it building the Perth to Adelaide railway link, which at the time cost 1/3rd of South Australia's GDP to build, and has more than paid for itself since then. The NBN is an infrastructure project, comparing it with anything other than another infrastructure project is like comparing bananas with sausages. Can you explain how the hell the prices are meant to come down if the NBN is currently being sold for FREE to telcos. What do you wan't, NBN co to give Telco's money for using their infrastructure?????
Bazwalt Sep 16, 2010 9:19 AM	@noelpeters - They did release one :) You just either didn't like or understand what it read. @epimetheus - Always at least one hater :P
myne Sep 16, 2010 10:17 AM	"Can you explain how the hell the prices are meant to come down if the NBN is currently being sold for FREE to telcos. What do you wan't, NBN co to give Telco's money for using their infrastructure?????" Because they were advised a high estimated price and told to factor that into their pricing. At the moment they're making more profit, but at the same time, they're also spending a lot on the R&D to properly support and implement NBN services. The NBN is only a sixth to a third of the national road budget for 10 years. No one complains about all the wastage of resurfacing perfectly serviceable roads. Oh, you can go faster on new roads? Why would you want to do that? You can still reach your destination at 50kph instead of 80. What do you mean that wastes time? So does a business waiting for data to send to a client. Time is valuable. The faster everything works, the more we get done in the least amount of time, the better everything works. On the topic of the NBN ONT, it has 4x gigabit ethernet ports, and 2x POTS telephone circuits. I deal with many customers who cant even get a working phone. The NBN gives a minimum of 2 - guaranteed. With another larger box, there is virtually no limit to the number of phones you can have. A MAJOR benefit to businesses everywhere. Trust me. I've had to listen to the shock, confusion and disgust when customers are told that "sorry, there's no copper to support a phone to your site." It's a disgrace.
RDEFCON1 Sep 16, 2010 10:18 AM	@deteego Are you seriously suggesting that NBNco is going to continue to give free access to ISPs? So the taxpayer is going to subsidise the service delivery and profits of private companies? If so, that's one more reason to vehemently oppose this appalling waste of taxpayer money.
deteego Sep 16, 2010 11:25 AM	myne wrote: "Can you explain how the hell the prices are meant to come down if the NBN is currently being sold for FREE to telcos. What do you wan't, NBN co to give Telco's money for using their infrastructure?????" Because they were advised a high estimated price and told to factor that into their pricing. At the moment they're making more profit, but at the same time, they're also spending a lot on the R&D to properly support and implement NBN services. Oh really? 1, The numbers don't add up to support what you are saying 2. Where are your sources? RDEFCON1 wrote: @deteego Are you seriously suggesting that NBNco is going to continue to give free access to ISPs? So the taxpayer is going to subsidise the service delivery and profits of private companies? If so, that's one more reason to vehemently oppose this appalling waste of taxpayer money. I sure hope not, but the other options doesn't look good either (because it means only the people that afford and need Fibre would get it, which means we are back to square one and Labor just wasted $$$ to give FTTH to everyone) Edited by deteego: 16/9/2010 11:39:55 AM
RJ Sep 17, 2010 5:08 PM	"I sure hope not, but the other options doesn't look good either (because it means only the people that afford and need Fibre would get it, which means we are back to square one and Labor just wasted $$$ to give FTTH to everyone)" For someone who thinks the free market will build the fibre network itself, you don't have much faith in the free market's ability to offer affordable pricing.
deteego Sep 17, 2010 10:40 PM	RJ wrote: "I sure hope not, but the other options doesn't look good either (because it means only the people that afford and need Fibre would get it, which means we are back to square one and Labor just wasted $$$ to give FTTH to everyone)" For someone who thinks the free market will build the fibre network itself, you don't have much faith in the free market's ability to offer affordable pricing. The point of the free market (assuming it actually works as it intends to) is companies provide technologies for which there is a market for. You don't build 2 billion cars when you only expect to sell 1 million, doing so puts you into deficit. So just like we will have 1.9 billion cards lying around not being used, Australia will have a massive amount of Fibre running around not being used. We don't even have a free market now, the infrastructure for telecommunications industry in Australia is over regulated, there is almost no incentive for any ISP to build any type of backhaul because backhauls being built by private companies have to be shared by other companies (by law). By Back to square one I meant that we will return to a situation where we have a monopoly infrastructure that is going to be serviced by one company (making things worse in the long run) Edited by deteego: 18/9/2010 01:17:19 AM