NBN Co fudges numbers to expand rollout

NBN Co has delayed fibre connections to 69,500 premises in one month alone in order to begin construction activities in a greater number of Australian cities and towns, an iTnews analysis can reveal.

As Australia's most politically scrutinised construction project struggles to meet deadlines, NBN Co has continually promoted the impression of progress by announcing that its fibre rollout has expanded to new towns and cities. 

Today iTnews can reveal that NBN Co has resorted to connecting fewer premises within existing sites than originally promised to allow for this expansion.

Between January and February this year, NBN Co indefinitely delayed the rollout of a total of 69,500 fibre connections promised to cities and towns Australia-wide, redistributing them among 37 existing rollout areas and two new ones.

The new rollout areas — accounting for over half (39,200) of the connections taken from existing sites  — are in Labor-held seats: Slacks Creek in the Queensland seat of Rankin and Queanbeyan in bellwether Eden-Monaro.

The biggest losers from the redistribution of these connections are the LNP-held Townsville suburb of Gulliver, which now has 12,400 or 42 percent less fibre connections than originally promised — and the Labor-held Keysborough in Victoria, of which 8100 connections have been cut from the rollout plan.

In total, a substantial percentage of the fibre connections promised to 14 towns and cities have disappeared from the rollout plan.

These include a significant proportion of the premises in:

• Armidale, Riverstone, Wollongong and Mudgee in NSW;
• Toowoomba, Cairns, Ipswich, Ashmore and Rockhampton in Queensland;
• Carlton in Victoria;
• Geraldton in Western Australia;
• Darwin in the Northern Territory.

Hold the line, please

A comparison of NBN Co data from one month to the next also gives an insight into how far behind schedule the network build is.

Month-to-month shifts in deadlines for NBN fibre rollout areas reveal that construction in 28 percent of new housing estates and 19 percent of built-up areas is running behind schedule.

The delays are in declaring the fibre optic cables as "service-ready". Connections in a service-ready area can be used by an internet service provider to sell a retail service (or by a consumer to connect to the internet).

Built-up areas of Western Australia and Queensland are the worst affected by delays in getting fibre cables ready.

In new housing estates, meanwhile, 50 percent of all rollouts that were pushed back were in Queensland.

A preliminary analysis by iTnews.com.au indicates that the delays in Queenland's new housing estates are clustered in cities and towns that experienced floods when ex-Tropical Cyclone Oswald battered the state in late January.

Sources close to NBN construction efforts in the state disagree, and believe the real issue is the availability of skilled labour.

An NBN Co spokesperson did not provide a response to several questions raised by iTnews.com.au.

Telecommunications analyst Paul Budde told iTnews that — in general — some delays in fibre builds were acceptable, but they became less palatable the closer they were to the proposed date of a cable being ready to carry internet services.

"Three years out [from being ready for service], a few months [of delay] would not make any difference whatsoever," Budde told iTnews.com.au.

"However, once you start reaching the six-month period [from being service-ready], I would think people would start to get annoyed by delays of more than a month.

"Once you get to the one-to-two month period [before service-ready], tolerance of any delay would start to be very low."

Robbing Peter to pay Paul?

The shrinking number of connections within towns earmarked for fibre was one of the more curious changes between the January and February iterations of NBN Co's service-ready schedule.

NBN Co lists 79 fibre serving areas (FSAs) in built-up areas where it currently has plans to roll out fibre optic cables.

FSAs are top-of-the-pile in the NBN topology. They are the towns, suburbs or portions of suburbs designated to receive connections.

Fibre to FSAs is deployed in phases, known as fibre serving area modules (FSAMs). A single FSA can consist of up to 24 FSAMs. Each FSAM consists of up to 16 fibre distribution areas (FDAs) that support up to 200 premises. (pdf)

To understand how far-reaching NBN Co's adjustment was over a single month, only seven of the 79 FSAs were not adjusted. Put another way, NBN Co altered the number of premises in 88 percent of the rollout areas.

It is possible to calculate the net effect of those changes. Between January and February, NBN Co skimmed 69,500 fibre connections off 33 existing FSAs.

It redistributed 32,300 of those connections to 37 other FSAs, and announced two new FSAs — Slacks Creek and Queanbeyan — to which it apportioned a total of 39,200 premises.

In summary, between January and February 2013, NBN Co added two new FSA locations to its brownfields fibre rollout schedule, which should have increased NBN Co's total brownfields footprint by 39,200 premises. Instead, the footprint only increased by 2000 premises.

NBN Co has effectively found a way to expand the network — without adding a great many new connections.

Read on for the winners and losers of NBN Co's creative accounting, and for a full analysis of slippages in new housing estates.

Brownfields winners and losers

In the meantime, 14 of the 33 cities and towns across Australia to lose premise numbers are substantially worse off.

There appears to be no political pattern in the data, with ALP, Liberals and Greens constituencies all losing previously-promised fibre connections.

In contrast, of the 37 existing FSAs to receive a top-up in premises numbers, six are substantial.

Ascot in the federal seat of Brisbane (held by the Liberal Party by a slim margin) more than doubled the number of premises it is to receive, going from 8400 in January to 17,200 in February.

Tullamarine and South Morang in Victoria each took in an additional 3100 premises. Both are in ALP-held seats.

Casuarina (NT, Labor-held) was bolstered by an extra 3100 premises, Townsville (QLD, Liberal-held) received 2900 premises, and while the numbers are smaller, Bacchus Marsh (VIC, Labor-held) went from 6400 premises to 7300 premises.

NBN Co didn't just plunder at the FSA level — the altered numbers cascade down the network topology.

One step below the FSA, some builds saw the number of premises per FSAM and the number of FSAMs in the FSA altered. Changes were also made to the number of premises per FDA.

On-time fibre in built-up areas

Construction at NBN Co's 79 FSAs currently consists of 326 phases ("FSAMs") and 1584 FDAs (smaller parcels of build work) as of February 15.

Working out whether NBN Co is on track to declare portions of its brownfields fibre network as being ready for retail service is complicated by a lack of dates and disclosure.

An analysis of the 326 FSAMs provides the best indication of how much movement there is in the expected service-ready dates for built-up areas in line for NBN fibre.

Of the 326 FSAMs, 61 percent (n=198) are on schedule, 19 percent (63) have slipped into the following month or beyond, and 15 percent (48) have been brought forward in the same fashion, say from June to May.

Two-thirds of the 63 slippages are in regions that should have had services coming online between now and July.

The slippages are mostly about a month in length, though the odd one or two — such as "Karloo, Rangeway, Utakarra, Wonthella, Geraldton" in Western Australia — slips from June to November 2013. That FSAM has 2900 premises.

NBN Co does not list every FSAM that will ultimately form part of a single FSA. Thus, one can calculate only whether published phases of work within an FSA are on time, not whether the entire FSA is running to schedule.

There is also a lack of disclosure by NBN Co at the layer of abstraction below the FSAM — the FDA.

The vast majority of FDAs carry an expected service-ready date "to complete in FY13".

Only 2.3 percent of the 1584 FDAs have a specific date for when they are expected to be ready to carry retail internet services.

Construction in all of those FDAs (those with specific dates) slipped their allotted service-ready schedule between January and February.

FDAs ranging in size from 122 to 177 premises in Coffs Harbour, Bacchus Marsh and Aspley were mostly pushed back by a month.

In addition, five FDAs in Armidale lost their schedules entirely, going from being expected to be ready for service in February 2013 to just sometime this year.

If one takes an aggregate view of every piece of brownfields build work with a service-ready date, 58.3 percent (n=201) are on schedule, 27.3 percent (n=94) slipped and about 14 percent (n=48) were fast-tracked.

The only uncertainty is how far these proportions can be extrapolated across the entire brownfields rollout, as they are calculated on 18 percent of the total network portions listed as under construction.

Read on for an in-depth analysis of how and where NBN Co's fibre rollout in new housing estates is slipping.

New estates

NBN Co's fibre commitments in new housing estates ("greenfields") are listed by release stage for the land or multi-dwelling unit (MDU) complex.

There were 854 stages listed in the January iteration of the service-ready spreadsheet, of which 24 duly met the service-ready schedule. In the February iteration, there are 869 land release stages across Australia that want NBN fibre.

In other words, 830 land release stages carry over from the January to February spreadsheets.

Unlike brownfields (existing houses), there are no problems working out how NBN Co is tracking towards its service-ready goals for new estates.

Out of the 830 stages, 38.4 percent (n=319) are on schedule and a further 11 percent (n=92) still do not have an assigned service-ready date.

In addition, 28.3 percent (n=235) of stages saw service-ready dates slip into the following month or beyond, 19 percent (n=158) were fast-tracked, and 2.4 percent (n=20) were given an expected service-ready date for the first time.

There is also a very small number of stages that have been given ambiguous new timeframes. For example, East Newman 3A and Newman Light Industrial Area 3 in the mine-rich Pilbara both move from "Q3 13" to "Aug 13". It's hard to know if this is an upward, downward or sideways movement in timeframes. In any event, it applies only to a statistically insignificant sample.

In the slipstream

Unlike brownfields, iTnews' analysis drilled down into lower levels of abstraction of the greenfields data. The results, in part, explain why the amount of slippage in new housing estates affects over one in four stages listed.

iTnews can reveal that of the 235 stages that slipped, 49.8 percent (n=117) are in Queensland.

The other states slipping behind are in Victoria (22.1 percent, n=52), NSW (13.2 percent, n=31) and Western Australia (10.6 percent, n=25).

Looking at the points of interconnect (POIs) that support the slipped stages provides further clues on what may have contributed to the overall number.

In Queensland:

• 18 delayed stages connect to a POI at Mackay, where most builds have been pushed back to July or sometime in Q3.
• Townsville had 15 affected stages, though the figure is skewed by many stages from a single large development.
• The Kallangur and Petrie POI on the Sunshine Coast supports 14 delayed stages. Work is now clustered in March/April and July/August.
• Bundaberg's POI supports 13 delayed stages, with new service-ready dates fairly evenly spread.
• Ningi 2 supports nine delayed stages. It appears to be an interim POI, with connections eventually to run to five other permanent POIs. Most fibre rollout work is now pushed back towards July.
• Rockhampton POI has seven delayed stages due to connect into it.

What appears to tie all these delays together is the aftermath of ex-tropical cyclone Oswald, which flooded large parts of Queensland in late January, flush in the time NBN Co's report was compiled. 

iTnews has asked NBN Co whether floods are to blame for greenfields delays but has received no response.

Floods clearly weren't responsible for all recorded delays. The South Morang POI in Victoria has 13 stages attached to it that were delayed for service-ready declaration, while Western Australia's South Coogee POI has nine affected stages.

Similarly, the flood-affected Rockhampton POI supports the second largest number of fast-tracked stages — 10 in total, equivalent to 429 premises.

Read on for our breakdown of the fixed wireless rollout stats.

Fixed wireless

NBN Co lists 33 wireless serving areas slated for fixed wireless service.

Of the 33 WSAs, 45 percent (n=15) remain on schedule and 36 percent (n=12) still have a service-ready schedule listed only as "TBA".

The remaining 18 percent (n=6) saw service-ready timetables slip. Four are in Tasmania (Herringback, Huonville, Deloraine and Westbury) and were pushed back by a month, from February to March 2013. Another tower for Motley in Queensland has slipped from April to May.

One slippage that will annoy some Tamworth residents is another delay to the proposed Moore Creek South site. Despite gaining council approval in late 2011, it has suffered repeated push backs, most recently from December 2012 to February 2013, according to Whirlpool posts, and now it isn't expected to be service-ready until May.

iTnews.com.au is seeking comment on what is behind delays at the site.

Methodology

This analysis is based on a fortnight-long investigation by iTnews.com.au of NBN Co's monthly ready for service rollout plan for February 2013 (pdf), compared to the previous month (pdf).

The document is published monthly for access seekers on the NBN. This is not the first time that consecutive months of data has been available - NBN Co has released the same data in the past but has removed each monthly report once new data has been made available.

iTnews' decision to run the numbers is a response to the increasingly fervent debate running around the National Broadband Network, which largely flies by without any statistics to support it.

For the purpose of the analysis, iTnews.com.au defined a slippage as any date pushed back into the following month or beyond. For example, a stage scheduled for February 2013 would be rescheduled for March 2013 or later.

Movement of service-ready dates within the same month — for example, February 2nd to February 15th — are considered to still be largely 'on schedule', for the purpose of this analysis, and have been recorded as such.

The service-ready plans also come with legal disclaimers that dates are "indicative" only and may change due to factors such as finalisation of "formal specifications".

Update, 2.44pm: NBN Co today told iTnews they would like more time to look at the numbers. We intend to publish the company's response.

5.35pm: Corrected percentage of WSAs that remain on schedule. The raw number (n=15) is still the same.

Do you know more? Email editors@itnews.com.au