Australia - National Broadband Network - Ready for 2011

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Last updated: 12 Jan 2011 Update History

Report Status: Archived

Report Pages: 2

Analyst: Paul Budde


The 2010 federal government election was a cliff-hanger but it was evident that the majority of Australians supported the National Broadband Network (NBN), with surveys indicating over 70% voter support. Access Economics Research showed a similar result for business demand. It is now full steam ahead for the NBN, but there will be significant pressure in two areas: NBN Co will have to roll out quickly, and the minister who has been placed in charge must ensure that most, if not all, of the 30+ rollout projects have trans-sector pilots attached to them, so as to warrant government investment. Initiatives were taken along these lines in late 2010.

The key to the success of the NBN is not ‘superfast Internet connectivity’ but ‘economic reform’ and therefore the political capability to get it off the ground is at least as important as technical capacity. While NBN Co is more than able to cover the technical capacity there is currently no strategic system in place to also address the broader economic reforms.

A good start has been the extension of the minister’s portfolio to now also include the responsibility for ‘Digital Productivity’.

A business plan, including proper financial information, was made available by NBN Co. There will be a focus on regional rollouts and regional application pilots. Under the NBN these projects are up-scalable and this in itself will attract a great deal of business investment of the kind already being entered into by Telstra, Optus, NEC and some of the mid-sized telcos.

There is widespread attention from overseas investors and international business people are already investigating the business opportunities that the Australian National Broadband Network market is offering them. The question is: are Australian businesses also up to this challenge? Will Australian organisations be able to take the lead and establish a new digital media industry that they can use as a platform to expand their businesses overseas?

As an important part of this the Australian diplomatic service and Austrade will have to increase their efforts to lift Australia’s information and communications technology profile on the international market.

It was mentioned that the engineering architects of NBN Co have an eye for detail, which will ensure that the network will be of high quality, particularly in relation to critical applications such as healthcare-monitoring and energy-monitoring services.

The Chief Executive Officer of one of the leading international wireless broadband companies commented that it would not be commercially possible to deliver life-critical applications over large-scale wireless broadband networks. He felt that he would not be able to guarantee a level of six-nines reliability and believed that, for health monitoring especially, this level of reliability would be necessary.

Interestingly, he also mentioned that in order to deliver such a high-quality level of service over wireless networks (satellite or wireless), ‘non-commercial’ rules would need to be applied to the network – that is, the number of users on such networks would be significantly limited, to enable the building of a network that has sufficient redundancy to ensure the high level of reliability necessary. He also mentioned that this could only be done in low density areas and that only governments could afford to build such networks.

After talking to so many of the world’s leading telecoms people at the recent UN conference, BuddeComm was able to gather plenty of advice to bring back to Australia.

One of the main points was to ‘expect the unexpected’. The NBN is one of the largest infrastructure projects ever undertaken in Australia, or anywhere else in the world. It is inevitable that things will go wrong and sufficient flexibility must be given on both sides of government to deal with any setbacks that may arise.

Obviously the NBN will transform our economy and our society, and many industry groups will face significant changes in the way they will need to operate. Some groups will take to these changes without difficulty, and they will be prepared. Other groups will complain and want the government to pay for the changes they will have to make. Still others will launch campaigns of fear, uncertainty and doubt, telling customers, voters, talkback radio hosts and the media that the world will end if they have to accept these changes.

It is crucial that the government prepare itself for this beforehand, so as not to be taken by surprise. It will need to develop strategic and political capacity and to create contingency plans in advance so that politically motivated opposition has no chance to derail the project.

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