Slow progress in Turnbullistan

By on
Slow progress in Turnbullistan

[Blog post] How has the NBN moved ahead since regime change?

The release of the latest NBN Co weekly progress report provides the first opportunity to assess progress under the company's new management and with its new mission.

Minister for Communications Malcolm Turnbull has had some fun of late creating an imaginary world called Conrovia to describe the gap he perceives between the progress former Minister Conroy claimed to have made versus what the Coalition now claims to have inherited.

In response, Labor’s Allanah McTiernan has taken to referring to Turnbull’s version of the truth as Turnbullistan.

These two imaginary countries have a lot in common, not least of which is the delivery of a major project in a highly charged political environment.

They also share an incredible propensity to not deliver on forecasts.

And as the leader of his own realm - now charged with delivering Australia's largest ever infrastructure project - Turnbull has found himself encountering the same difficulties as his predecessor.

Phases of the NBN project

As the figure above details, the commencement of the NBN rollout under the ALP Government began in March 2012.

The leader of Conrovia spent a significant amount of time prior battling through the difficult negotiation process with Telstra. Now we see history repeating in Turnbullistan.

The Post-Conrovian era constitutes one third of the 27 months the network has been rolling out.

It is hard to determine how well NBN Co is progressing against the recommendations of the strategic review because the critical timeline chart (Exhibit 4.6) has been entirely redacted.

However, there are a few data points to draw together. In November 2013, Minister Turnbull visited Blacktown with NBN Co’s executive chairman and said the company would double the premises passed by fibre by June 2014. That number was confirmed by his office as 450,000.

By the time the strategic review was released, that expectation had been revised down to 357,000. The actual outcome of 381,146 is closer to the review number.

On a national basis, we now know the number of additional premises passed per quarter has slowed, as the table below shows:

NBN Co COO Greg Adcock said at a results briefing in February that the company “exited the year at a run rate of around 4500 premises per week" and was targeting an 'FY2014 exit run rate of around 6000 as we ramp up and stabilise the program.”

The company has not been able to meet this expectation. The run rate for the quarter has been 3355 per week (see note below for calculation).

NBN Co last week issued a press release announcing a fourfold increase in fixed wireless coverage. The 106,000 premises mentioned in that release has already increased by a further 6000. But that 112,000 is 10,000 less than what had been forecast in the strategic review (see Exhibit 2-11).

There have also been delays in securing access to copper for FTTN trials, and last week NBN Co revealed delays in the commercial launch of FTTB.

This is an incredibly complex project, made even more complex by the decision to replace one technology (FTTP) with four (FTTP, FTTN, FTTB and HFC).

The current Government accepts that fibre-to-the-premises is the end game, but contends that it is more cost effective to do so in several stages rather than one.

It has pre-empted the conclusions of the cost-benefit analysis and jumped straight to implementation. But the numbers show that the implementation has not managed to pick up any speed.

Turnbullistan is quickly discovering it has more in common with Conrovia than Malcolm would like to admit.

Note: The quarterly run rate was calculated using the period from 6 April to 30 June, as NBN Co made a minor adjustment to the metric in the first week of the quarter.

 

David is a thirty-year telco veteran who has worked in corporate sales, strategy and regulatory and corporate affairs for Telstra, Hutchison, AAPT and Unwired/vividwireless. His writing and consultancy career was briefly interrupted when he agreed to join then Minister Senator Conroy’s office.

That continued through the change to Minister Albanese and since the election with Shadow Minister Jason Clare. David conducts policy research under the business name DigEcon Research and consults to various participants through Havyatt Associates. He is also contesting the NSW election in 2015 as the Labor candidate for Epping.

Tags:
David Havyatt
David is a thirty-year telco veteran who has worked in corporate sales, strategy and regulatory and corporate affairs for Telstra, Hutchison, AAPT and Unwired/vividwireless. His writing and consultancy career was briefly interrupted when he agreed to join then Minister Senator Conroy’s office. That continued through the change to Minister Albanese and since the election with Shadow Minister Jason Clare. David conducts policy research under the business name DigEcon Research and consults to various participants through Havyatt Associates. He is also contesting the NSW election in 2015 as the Labor candidate for Epping.
Read more from this blog: The Insider Outside

Most Read Articles

Log In

Username:
Password:
|  Forgot your password?