National Broadband Network under the microscope

I’m seriously conflicted by the debate over Labor’s National Broadband Network.

On one hand, the future of CDU’s online Bachelor of Laws programs, whose creation and development I oversee, is heavily dependent on the availability of almost universal truly fast broadband within the next few years.  The policy that the federal Coalition took to the last election just doesn’t cut the mustard and would if implemented effectively stymie our plans and possibly the long-term viability of the law school itself.

Indeed it would imperil federal government plans to expand the scope of higher education to cover double the number of Australians presently studying by 2020.  That can only be achieved if people can study effectively using powerful flexible learning technologies which allow them to study from home or the workplace rather than needing to traipse to a university campus after work.

On the other hand, I think Labor’s current NBN policy is seriously wasteful and dangerously extravagant.  An adequate fast broadband policy could certainly be fashioned which would cost much less than Labor’s plan but deliver reliable fast broadband to a much greater proportion of Australia’s population than the Coalition’s badly flawed ideas.  Let me explain.

CDU’s B Laws program relies heavily on voice and video-enabled virtual classrooms for live or “synchronous” teaching of students throughout Australia and overseas.  We’re currently the first university anywhere in the world to be teaching legal professional skills (like advocacy, client interviewing and negotiation and mediation skills) in an online environment.  That requires simultaneous multi-screen Internet video-conferencing capability for all participants, desirably in full screen and high definition and with minimal lag times.  We’re using the Adobe Connect Pro system (in conjunction with the NT Department of Education) and it’s great, but we’re hampered by inadequate Internet speeds.  Something like 70-80% of human communication is non-verbal, and to teach and learn “conversational” professional skills students need to be able to observe and react to those non-verbal cues. We have found that students with fast (by present standards) ADSL2+ fixed line connections offering average speeds around 8-10mbps sometimes get almost (but not quite) satisfactory video resolution and lag times.

Students with wireless broadband connections get hopeless performance, with speeds typically fluctuating wildly between around 10mbps and slower than dial-up speed.  I’m told that this results from the inherent nature of wireless broadband, a shared connection to a local tower where the speeds a user experiences depend on how many others are acessing the Internet via that tower at any given time, and what they’re doing from moment to moment.  I experienced it myself when relying on a wireless connection from Albury NSW last week.  It was school holidays, so the speeds were slower than dialup (and utterly unuseable) all day while the kiddies were playing online, but quite fast late at night.  That is simply hopeless for any serious use (e.g. online higher education) and yet it is the solution Tony Abbott’s Coalition were touting for all of regional and outer suburban Australia.  It is utterly stupid and unworkable.

As I observed above, even ADSL fixed line Internet as currently deployed is not quite adequate for serious virtual classroom teaching.  The same would no doubt be true for analogous uses like medical conferences and business video conferences (imagine the savings if most of Australia’s 2 million businesses could conduct most meetings with interstate and overseas colleagues from their desktops rather than needing to fly to face-to-face meetings).  I’m told that consistent speeds of better than 20mbps are necessary to sustain multi-window full-screen high definition video conferencing with minimal lag times.  These speeds are not consistently achievable even with the fastest of currently deployed fixed broadband reliant on the existing copper network.

However, faster speeds than this (up to the 100mbps speeds claimed until recently by the NBN) are achievable (or soon will be) through a combination of fibre-to-the-node (FTTN) (as opposed to Fibre-to-the-Premises (FTTP) on which Labor’s NBN is based) and emerging technology which will allow 100mbps speeds using upgraded existing copper connections for the last kilometre.

I have no idea exactly what the savings would be from relying on FTTN with central nodes approximately 1 kilometre apart in all suburban areas and regional towns for universal very fast broadband (100mbps), as opposed to the NBN’s universal FTTP solution.  However it is bound to be a mere fraction of the $43 billion estimated price tag for the NBN.

If almost universal speeds of 100mbps can be achieved with FTTN, as seems to be the case, the only remaining justification for the NBN’s FTTP strategy is to wrest control of the existing copper network from Telstra and effectively break its wholesale monopoly which it continues to use to extort high access prices from competing ISPs, thereby stifling genuine Internet competition and inflicting on Australian consumers prices for Internet access that are almost certainly much higher than they should be.  However there is no reason why the federal government could not negotiate a buyback (or sale to the NBN company) of Telstra’s existing copper network in the context of a FTTN strategy, under threat of compulsory acquisition if it failed to deal in good faith.

Coalition mouthpieces like Malcolm Turnbull and Paul Fletcher (former director of corporate and regulatory affairs at Optus) make some powerful points about the likelihood of the NBN company making a reasonable profit under currently proposed arrangements.  Estimates of a 6-7% rate of return, relied on by Minister Conroy and based on an ‘Implementation Study’ by government engaged consultants McKinsey and KPMG, seem highly optimistic at best.  On the other hand, Labor now seems to be planning effectively to force consumers to sign up to the NBN through a mix of carrots and sticks: adopting an “opt-out” model for connection, offering free connections to early adopters, and making it clear that the legacy copper network will eventually be decommissioned so that everyone will ultimately have no choice but to use the NBN for both voice/telephony and data.  That may well allow NBN over time to achieve its required 60-70% of households signing up, but it still doesn’t justify paying much more than necessary to achieve almost universal 100mbps speeds.

The Coalition is over-egging the pudding with its demands for cost-benefit studies and strident remarks about opportunity costs, but with qualifications it has a point which Labor conspicuously does not (and probably cannot) answer.  Many of the likely returns from a universal very fast broadband network are impossible to calculate in any reliable sense, and are in any event “externalities” which won’t be captured by the NBN company itself (e.g. what proportion of business meetings will be conducted via online HD video conferences in preference to flying to interstate meetings?  Any estimate in a cost-benefit analysis would be no more than a wild guess).   But those difficulties cannot justify spending $43 billion, more than half it and possibly much more being taxpayers’ money, when we could achieve an entirely satisfactory and almost universal very fast broadband service for a fraction of that price (though no doubt significantly more than the $8 billion Tony Abbott was asserting as the cost of his party’s hare-brained scheme during the election campaign).

The Coalition would be much more convincing in its Internet rhetoric if it explicitly dumped its stupid pre-election broadband policy and adopted one based on a combination of FTTN and upgraded copper for the last kilometre.  I am available for a lucrative consultancy at very reasonable rates (comparatively speaking).

PS In case of readers who can’t work out the blindingly obvious, the opinions expressed here are purely my own and do not necessarily in any sense reflect those of my employer.

About Ken Parish

Ken Parish is a legal academic, with research areas in public law (constitutional and administrative law), civil procedure and teaching & learning theory and practice. He has been a legal academic for almost 20 years. Before that he ran a legal practice in Darwin for 15 years and was a Member of the NT Legislative Assembly for almost 4 years in the early 1990s.
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David Turnbull
David Turnbull
13 years ago

In your scenario, we’d have to rip out the copper and wire everyone up with fibre anyway, because we will need 1Gbit connections, then 10Gbit, and so on, for decades of exponential technological growth.

So the cost of maintaining the existing copper network should be added onto the cost of the inevitable FTTP rollout.

Add, also, the costs of poor competition as the nature of exchange-based access continues into the future.

Or the cost of building hundreds of extra exchanges so that people outside of the arbitrary 1KM radius can access this new technology.

On the question of how much it would cost.. what wriggle room are you talking about? ~$22b is the upper bound, $8b the completely ineffectual carrier subsidy. “Significantly more than $8b” gets you pretty close to $22b. Australia is not a poor country. Federal income for 2009 was close to $300b. What are we worried about?

I think if your point is FTTN vs FTTP you need more than “bound to be a mere fraction of the $43 billion price tag for the NBN”.

I’m going to apply Occam’s Razor.

13 years ago

I share your scepticism about the net benefit of FFTP compared to FTTN. Were these issues canvassed in the implementation study, or does that study take FTTP as a starting point?

In relation to Telstra, I thought the government had negotiated an agreement for Telstra to give up its copper. Couldn’t that agreement apply under FTTN as well as FTTP?

13 years ago

I am a distance student living in Darwin and during the school holidays was unable to get better than dialup speeds. Downloading a PDF was painful. Congestion in Darwin gets pretty bad I’m told and the Telstra upgrade of the Darwin exchange (where I am) is on the books, but who knows when this will take place. There is speculation that the NBN announcement has forced Telstra to back off existing exchange upgrades until they can secure some deal with NBN.

I wasn’t aware of the carrot and stick approach being taken by Labor. I can’t help but feel a government guaranteed market monopoly is being established for NBN Co’s float in the future. I don’t know if lessons from Telstra are being heeded here.

Not sure if you were aware but Casuarina has been slated as part of the second roll out of NBN. I suppose we’ll soon be able to see first hand how things transpire.

Possum Comitatus
13 years ago

Ken, just a few things.

Firstly, the 43 billion figure was what it would cost with no one else playing ball and NBN Co going it alone. Telstra and Optus are now both on board, so we’re no longer talking 40 something, but thirty something billion. We should get some sort of new updated number soon (some are saying this week… ugh, we’ll see!)

Secondly, if NBN Co went FTTN and purchased the CAN from Telstra (the only way to solve the regulatory issues), the cost wouldn’t be the 11 billion that the government is paying to get Telstra to turn the copper network off, as it would be the copper as well as a number of other additional pieces of attached infrastructure. So we’d be looking at something ultimately more around 15 billion.

Thirdly, FTTN assumes that the copper network is in a good state. It’s not! Telstra spends somewhere between 400 mill and 1 bill every year on the CAN just to keep it operating at it’s current appalling state, under it’s current demands.

So an FTTN would be around 15 bill to buy the network, another 5 to build the nodes and fiber and miscellaneous bits and pieces, a few billion to upgrade the worst of the copper blackspots and then a billion a year to bring the rest of the network up to VDSL2 standards and keep it there – a bill a year, every year, forever!

We aren’t dealing with keeping some piece of pristine infrastructure in some pristine state here – we’re dealing with upgrading a network that’s practically up to 60 years old in some places and stopping it from completely falling over. For the last decade, maintenance on the CAN has been more an exercise in palliative care for a terminally ill geriatric asset.

So were looking at something around 25 billion to start with just to build it and get it working to VDSL2 capability – and that doesn’t give us 100Mbps mind you, it will give us a range of speeds somewhere between 50 and 90 depending on where each household is, assuming we’d whack in nodes about a kilometer apart (as VDSL2 speeds are still a function of distance from the node). All this, and we’d still have constrained speeds on the upload side because DSL isn’t symmetrical.

After 10 years, we’d have spent the same on an FTTN solution as we would have on a fiber to the premises solution, but where our 100Mbps theoretical maximum speeds have pushed up against the limits of physics (like we already effectively have for distances beyond about 1.8km from the exchange with our current technology) compared to fiber which would have been 1 Gbps from the start, with a solid low cost growth path for higher speeds, and where fiber gives us full blown speeds both ways to boot.

The reason FTTH was chosen over FTTN wasn’t because of nonsense about thought bubbles in planes by Prime Ministers – it was because the marginal benefits compared to the marginal costs of FTTH over FTTN made the ultimate decision one where there was no real decision to be made between them at all.

13 years ago


False dichotomies abound on blogs (and in politics) and here we have another one: FTTP or FTTN. How about FTTP where the copper is ancient and requires replacement anyway and FTTN where it has a good life left in it? Australia’s population growth must mean that there is a fairly substantial part of the network which is relatively new. (The “up to 60 years old” is just rhetoric, as Australia’s population was only around 8 million in 1950.)

Possum Comitatus
13 years ago


The money Telstra spends on maintaining the CAN now, is generally for maintaining phone and *very* basic data connections as part of their statutory obligations. Basically, they’re simply maintaining the physical connections of the network.

Under an FTTN, the requirement standards for copper performance increases dramatically (simply to make VDSL2 work), so we wouldn’t be dealing with just maintaining the physical connections, but *also* maintaining the copper loops to the point where non-distance-related noise in those loops is removed as well (noise that is caused by degraded, rather than broken connections and in some places, degraded copper, neglected pits, exogenous interference etc etc ).

As a result of the additional maintenance demands to enable VDSL2 to function, we aren’t talking about a budget comparable to the current Telstra budget – but one which would be substantially larger. So it wouldn’t be the half a billion a year (at the lower end) that Telstra spends now, but much more simply to meet the much higher performance requirements.

The CAN at the moment is like old roads, old bridges, old buildings etc – the age of the asset is a problem itself to the point where it’s got Harbor Bridge syndrome – where once you finish painting the bridge, you have to go back and start again… it never ends.

So while the maintenance on the CAN would gradually bring it up to scratch for an FTTN, because of its age and condition, the maintenance will never end. By the time you’ve fixed it all up, you’ll have to go back and start again.

The upgrading and maintenance of the copper is what really kills FTTN from being a viable competitor to FTTH on costs (let alone performance) – but the state of the copper network is like this bizarre elephant in the room that very few people ever seem to talk about (even though it’s the very thing that causes most of our problems with current telecommunications technology!)

As for this government making a case – this lot couldn’t sell the case of a cold beer on a hot day. I’ve never seen a government anywhere that is so completely and utterly hopeless when it comes to explaining what they’re doing and why.

Some of the Dept folks across the fed gov are pulling their hair out.

Possum Comitatus
13 years ago


One of the problems with the copper is that its quality is a often a street by street rather than a suburb by suburb proposition – so if we went with dual technologies, half the streets in a given area would have fiber back to the exchange or the node, and half would have copper. So it wouldn’t really reduce the cost by much because you’d be running parallel systems with a bizarre sort of transition process.

I have that problem where I live – I pull 4 megabits while a bloke a street over pulls 7 and we’re exactly the same distance from the exchange. I’m in an older, outer suburb – in the inner cities it’s even worse – where one street can pull close to 20 Mbps on an ADSL2+ system, where the next street over cant get 5 because of the copper. West End and New Farm in Brisbane are notorious for that.

The “60 years old” isn’t rhetoric (in a few places it’s actually older than that) – some copper is older than others, and while some newer suburbs have newer copper (and many have rims, killing current ADSL technology), others don’t. Where the copper was old and has been slowly replaced or upgraded or expanded over time – it hasn’t been undertaken in any organised fashion, but just done with a mostly “she’ll be right” attitude which was perfectly acceptable for phones, but not for digital data. The connections, however, are nearly all still rubbish.

It’s not only the age of the network, but the way the network has been managed since it was first built that has created a cascading series of problems – problems that all come to a head when we try to push digital signals down a piece of infrastructure singularly designed for early 20th century analogue technology.

Nicholas Gruen
13 years ago

It’s a case the govt needs to make. Well I can’t disagree with that Ken, but we’re not talking about Bob Hawke and Paul Keating here. We’re in a “post-case-being-made-world”.

The case has to be run through Sussex St and then focus grouped. Now Sussex St doesn’t know what optical fibre is, and there’s no chance of the focus groups making the case.

So I’d say we’ll just have to go with the policy without the case. Kind of like the best management of the GFC in the world really isn’t it?

13 years ago


Well, that all sounds plausible. I can understand the potential problems with mixing and matching. You make it sound like the biggest benefit of the NBN is replacing the current mess of copper and so perhaps the ancillary benefit of superhigh bandwidth is just a happy spin off. If that is the case, maybe the question of “why on earth would we ever need such high bandwidth?” is missing the point. It’s just the cheapest way to get uniform, decent broadband.

13 years ago

We have found that students with fast (by present standards) ADSL2+ fixed line connections offering average speeds around 8-10mbps sometimes get almost (but not quite) satisfactory video resolution and lag times.

Some statistics, from the Nine Network Australia broadcasting DVB-T on VHF channel 8 (191.625MHz) using 64QAM, 8kHz with FEC of 3/4 and guard interval of 1/16:

Total bitrate of the broadcast is 23Mbps, which is broken up into:
* NINE DIGITAL at approx 26% of bandwidth or 6Mbps (720 x 576i, 25 fps)
* NINE HD at approx 54% of bandwidth or 12.5Mbps (1440 x 1080i, 25fps)
* GO! at approx 13% of bandwidth or 3Mbps (704 x 576i, 25fps)
* Various radio and teletext channels using much less
* All video is MPEG-2 I believe

For full details see and

The ABC uses the same basic DVB-T digital carrier but they split it into one HD channel (for news?!? why?) and three SD channels (approx 11M, 3M, 3M, 3M).

Thus you should be able to get something as good as NINE DIGITAL broadcast quality with 6Mbps, but throw in a bit of overhead for IP streaming layers and you are probably up to 7Mbps, maybe a touch more for the peaks because streams are not fully constant bitrate, should be fine with 8Mbps. I personally don’t watch much TV but I’m told that nine digital broadcast quality is good, and from what little I have seen I’d tend to agree. Or you could get something as good as standard ABC or SBS broadcast with less than 5Mbps peak Internet data rate.

ADSL2+ does not generally vary that much in available bandwidth from minute to minute, it does vary a bit with water in the soil from day to day and perhaps other sources of interference that might switch on and off in the neighbourhood. The copper line is dedicated to a single user so if you see it showing 10Mbps on the modem then you get that speed, without sharing, right back to the exchange.

I suggest that there are a number of reasons that your video quality is not quite satisfactory:
* Good codecs are expensive, and difficult to fine tune, many fit the standard in terms of compatibility but this is lossy compression so the subjective quality is a big issue.
* The bandwidth of the ADSL2+ probably is not the bottleneck, it probably chokes deeper into the network where the ISP shares bandwidth from many users (and this is where the minute to minute variability is introduced), all cheap ISPs share their upstream bandwidth. With time and effort you can trace out where the bottleneck is, most people don’t bother.
* PC software video players tend not to be quite as good as dedicated set-top-box video players.
* No affordable ISP in Australia currently provides Quality of Service features (QoS) on ordinary Internet traffic, you can get it on the higher level business grade networks (e.g. Telstra IPMAN) which will certainly be adequate for your needs (and available right now), but ensure comfortable seating is available before you let them tell you the price.

Also, I think you are unfair with your denigration of wireless networks, I used iBurst for quite a while and it performed very well and consistently well — I gave it up simply because it cost too much. The technology is out there right now, but people on the whole don’t want to pay for it. That’s what a marketplace is all about, making price/performance decisions. Currently 3G mobile data piggy backs on the telephone carriers and if you study the business case I think you will agree that the networks need to give priority to phone calls over and above data, thus there will be times when data has to wait. This is not an intrinsic limitation of the technology, it is an economic limitation based on the number of towers you are willing to build, the spectrum you are willing to rent and how you intend to pay for all that stuff. Someone always has to pay for it.

In reply to Possum and FTTN — the copper automatically gets higher bandwidth as it gets shorter, and yes you do get a few crappy pairs but that always happens, so maintenance is no different with VDSL2. The FTTN can be enhanced incrementally and gracefully by merely adding more nodes (this does involve adding more fiber as well, but vastly less fiber than the NBN design). Each new node shortens all the copper lines around that node and thus upgrades bandwidth. DSLAMs are physically small and quite cheap these days so a “node” might be no bigger than a half a broom cupboard. The real problem with FTTN is a regulatory one… Telstra owns the copper so it is impossible for competitors to build any new nodes that intercept existing copper pairs. If Telstra build a new node they will build it only to hold the DSLAMs they deem necessary then make it “capped” which is to say officially full and not available to competition. Telstra argue, why should we build infrastructure for competitors to use? Other ISPs argue, we would love to build infrastructure but can’t actually touch any wires. That’s why they are all building wireless towers, because at least everyone understands who owns what.

Meanwhile, the consumers for the most part are demanding cheap, cheap, cheap. If you really want fiber into your building now, and you are happy to pay for the build, you can get it any time (and needless to say, if you are far from the city the costs tend to go up).

13 years ago

I think we should just scrap any remaining legal/regulatory barriers to entry, give three Indian operators about $1 billion each in start-up incentives and pay people who live more than 2km from a community of at least 25000 people a susbsidy of say $1,000 a year phasing down by 10% a year.

Would probably be cheaper faster and more reliable than anything else we might do.

13 years ago

Re cost, and cost-benefit analysis, Laura Tingle in The FIN on 17 Sep:

Tony Windsor, the independent MP whose crucial vote locked Labor into minority government, has one way of looking at it.

“One of the arguments against the NBN is its $43 billion price tag,” he noted last week.

“Well, apparently the actual government investment is closer to $27 billion. But I’d just note that over $40 billion has been spent on tax cuts since the last election.”

He’s right, of course.

It’s funny how no one ever asks for a cost benefit analysis to be done on personal tax cuts.

For that matter, until Labor came to office in 2007, governments rarely asked for any cost-benefit analysis on infrastructure projects” […]

I dare say there was extensive cost-benefit analysis done on the Sydney cross-city and Lane Cove tunnels. Without it they could not have been the roaring commercial successes that they are.

There are times when, if something is affordable, gut instinct says “do it”; and times when the modeling says “do it” that gut instinct says “not a chance”.

mister z
mister z
13 years ago

In ten years’ time, when oil has a floor of USD150/bbl and peaks beyond that, the ability of (say) 50% of office workers in Australia to have genuine seamless high definition telepresence to their office and other offsite co-workers and simply not commute (say) 2-3 days a week, the investment in the NBN (even at £42bn) is going to look like a very savvy investment.

Don’t get me wrong – I know much can be done now – I run live online training for staff in 40 countries, some of whom have a 250kbps connection for an entire office if they’re lucky. But this is a whole different world for work and the energy density of the economy. The NBN is just the hedge we need against peak oil.

13 years ago

Ken, so you want to deliver a broadcast-quality multi-channel stream equivalent to the major television stations, but you want to achieve this on a mere lawschool budget?

You might consider iiNet’s Bonded DSL sessions. Most telephone cables are actually two pairs (four wires, that’s the CAT-3 standard). However, many users only use one of these, so a substantial chunk of the copper in the ground sits unused. For a bit more money you can use all four wires and get something like double the speed. The modem that does this is more expensive.

If the iiNet option looks workable, I point out that your 24Mbps stream is going to consume 10 gigabytes of data per hour (actually a bit more because they count uplink as well) so you will either need to buy the biggest plan or somehow enter into a peering agreement with the ISP and get yourself into the “free zone” (i.e. content that does not get included in the plan quota). If iiNet’s bonded idea gets popular, no doubt others will be into it shortly.

For the premium data link options (usually ethernet over fiber), it would be worth a chat to Telstra, Optus, AAPT, Nextgen, AMCOM, etc. I’m sure they would be interested in your project… there’s this urban myth going round that law degrees cost a lot, and lawyers earn a lot so the only thing better than the sniff of a new customer is the sniff of a customer with money :-)

Ultimately it comes down to what is better value: moving pictures, or moving students. Perhaps a compromise of having a few “comms rooms” around the place with expensive high-quality cameras, good lighting, multiple high resolution screens (what’s the point of sending an HD broadcast just to squish it into a tiny window) and get an expensive fiber feed to the comms room. Then the students move a short distance to the nearest comms room. Maybe you can rent the comms room to other projects and catch up some of the money.

Better throw in the obligatory disclaimer here (since I do work in what is broadly called the ICT Industry), if I’ve mentioned any brand names or product names I absolutely do not represent those companies, nor do I advocate any particular product. I am only sketching out a few ideas of what is available in the market right now, and heartily recommend a discussion of details with the relevant trained sales staff. Or at least a browse through the various company websites looking at the products they offer. Sometimes employers get sensitive about what they read on blogs, you know how it is…

13 years ago

Ken you want to be a bit careful with this “100M over existing copper” business.

If you read that article, it is actually 100M up to 1km using two lines by bonding them together. That means in many cases laying extra wire.

If you have to go to that trouble, you might as well lay fibre.

John B
John B
13 years ago

For those who still think that there is hope for copper:

My connection is supposedly ADSL2+. The packet loss rate exceeds 95%. This figure is rarely bettered. Telstra even re-terminated every connection all along the route back to the exchange in an effort to improve things. This has been the case for years and isn’t going to get any better any time soon.

My effective download rate varies downwards from 0.5MBPS at best, which is still heaps better than the old dial-up. A Skype phone call is only just achievable, sans video.

I cannot wait for fibre or whatever – delivery by camel would probably be an improvement, and I haven’t even mentioned upload rates.

PS. No, I don’t blame Telstra. Their folk have been alternately helpful and imbeciles. The problem starts with past governments and regulators, for failing to set realistic minimum technical and performance standards about ten years back, and to update them progressively as appropriate. The current copper system remains locked in the past because of regulatory neglect.