Labor vs Liberal

Policy Comparison

Who gets what?

Policies

Labor Liberal

Implementation

  • 22% Available speed choice of up to 100Mbps via fibre optic (FTTP)
  • 71% Peak speed of 25-100Mbps via VDSL2 Fibre To The Node (FTTN)
  • 4% 25Mbps via 4G/LTE fixed wireless
  • 3% 25Mbps via satellites
  • Policy
  • Executive Summary
  • Background Paper

Ownership

Selling NBNco after completion, but the Greens want it to remain in public hands. Any sale must first be approved by federal parliament. Selling NBNco after completion. Consider selling the NBN rural satellite service early.

Who Benefits?

Labor Liberal

Public

Yes

    Equal Capabilities in delivering speeds forces RSP's to get creative with pricing and what else they can bundle with internet.

    Read more about benefits
Mostly No

Creating a greater digital divide between those with fibre and those without equates to the current situation of playing broadband roullette depending on where you live.

FTTN speed is an illusion painted by telcos saying things like
"Fast broadband speeds up to <insert speed>".

They don't guarantee speeds they say up to

This disparity and non-guarantee leads consumers to pay for something they won't necessarily get as has been the case thus far.

Businesses

Yes
Given the opportunity to take full advantage of cloud computing that is:
  • Infinitely scalable
  • Cost / time saving
  • Fast to rollout

With correct implementation businesses and consumers alike will see an increase in productivity, efficiency and Quality of Service (QoS) provided.

Mostly No

Larger businesses will be well off, particularly those within sydney and the fibre footprint. What about those smaller businesses a few km's outside town?

By charging them for connection for a resource you're providing to others for free you're:

  • Increasing disparity. Giving some businesses unfair advantages over others.
  • Limiting development in not giving them access to clound services allowing for optimization of their business.
  • Creating a further digital divide (competition barrier) makes it harder for initial businesses to startup.

Telstra

Yes
  • OPEX potentially can decrease by 70-80%
  • The ROI is greater and over a far longer term
  • Upgrades are more easily accomplished providing them with the ease of satisfying customer demand in future.
  • They retain ownership of the current copper network, approximately 177,408 tonnes recycled could provide another source of capital.

    Read More

Yes
  • Telstra takes us for all we're worth regarding buying the copper.
  • Assuming this is just a subsidy and telstra remain in control of the network to assist in the 'sooner' rollout, users continue to pay copper line charges even after it's finished.
  • Since the reliability of FTTN is dependant on distance
    (among other things) the only other technologies available on the market to satisfy demand would be either fibre or HFC.

    Current HFC is owned by Foxtel... in partnership with Telstra.

R. Murdoch

Mostly No
  • The proposition of IPTV and distibuted media is a significant threat to his business model (Foxtel / news ltd). With the existing network Telstra was not interested in broadband TV, however with FTTH Foxtel can be cut out of the loop providing Telstra with more revenue.
  • Not only this but since Telstra won the EXCLUSIVE sports rights to the NRL and AFL, this cuts fox out of the loop for 2 major money spinners, either through the broadcast itself or through ad revenues.
  • Combine this with the fact that Movies / TV content can be outsourced directly from overseas IPTV providers (that could very well setup shop over here due to faster speeds) such as netflix, apple, sony and Foxtel is rendered utterly redundant.
Yes
  • By going the FTTN route it will prolong the death of foxtel (HFC cable) by a few years therefore granting a reprieve from spending initial CAPEX. However it is inevitable that we move to IPTV (a content on demand scheme), the only thing to be gained by doing this is time.
  • During this time true, you can raise capital to implement a new market strategy to entice people to use your services.

    But the reality is that prolonging the inevitable will only cost more by way of credibility and OPEX transitioning to 'content on demand systems' facilitated by FTTH and overall CAPEX expended over the final phased implementation.

    Example? look at the transition from IPv4 to IPv6, running a dual stack or NAT is expensive both in network resources and in OPEX management and you end up spending twice as much maintaining the orginal IPv4 stack. So why is it done? Because it has to be. The average user cant be expected to know the difference or be able to configure a device with addressing, all they care about is the content.

    The scenario has 1 key difference however, in the transition from IPv4 to v6 the user is responsible for configuring their device (obliged to take part in implementation).

    In a transition from HFC cable to a fibre solution (under labor), foxtel is not responsible NBNCo and contractors are. In other words all the restructuring (if done correctly) will save on OPEX not having to do a phased transition in delivering content.

    The ONLY reason to hold off on doing this is if you consider HFC a challange for FTTH. Not withstanding the facts from a technical standpoint that Fibre dwarfs the bandwidth capacity and reliability of ALL other mediums if you thow in phone service on top of that (something which HFC cannot offer) the proposition of maintaining it looks shaky at best.

    This is the reason why R.Murdoch supports FTTN over FTTH, he wants to maintain his hold on the entertainment networks a little longer to squeeze every drop of revenue he can out of them. Why? Because of the uncertainty that if he invests in the NBN there is no guarantee / agreement in place that he can maintain his hold as the primary news distribution conglomerate.

If he invests now he can actually make proper use of the NBN and become the 'most reliable' content provider when it comes to news in this country granting him 'a form' of monopoly but with enough transparancy to be acceptable. However it will not be easy to restructure, an agreement with Telstra / NBNCo could help facilitate this.

Propaganda

Twisting the Truth

Copper is still good

Can the promise of at least 25Mbps, to every premises using the existing copper be delivered upon, from a technical perspective thus achieving a more economically agreeable outcome?

Distance

Ovum consulting did a bit of analysis for the ACCC in 2009. Average copper loop lengths in this article are listed as being just over 2.5km as an underestimate.

Telstra stated this was incorrect, we are closer to Canada and the USA (over 3km loop lengths).

This is a far cry from the 1.5km Malcolm Turnbull claimed was a 'long copper loop' (transcript) in the OurSay debate hosted by zdnet (in the playlist above).

The policy does not state what the minimum distance from the node to the premises must be, quote:
'Fibre to the node,' or FTTN increases bandwidth at manageable expense by making use of the existing copper infrastructure over the last few hundred meters before reaching customer's premises.

Cable Standards

Malcolm Turnbull has done alot of comparisons to BT and other telco's around the world, fair enough. Using them as example of network topology is fine...

Problem: The hardware / infrastructure is different in our own country

Gauges Quote
Australia
  • 0.32mm (CBD)
  • 0.40mm (urban areas)
  • 0.64mm (rural / remote areas)

The smallest gauge cable, 0.32mm, has inadequate transmission properties for normal urban use so is only used in areas where there is limited housing capacity and a short loop length requirement to the customer. In this model, 0.32mm cable would only be used in a CBD environment as sufficient duct space would be created in urban areas to install standard cable sizes.

The 0.40mm gauge cable is the cable of choice in urban areas. In practice, it should be the heaviest cable gauge installed into the urban network today as network beyond the transmission limits of that cable should be on a fibre fed technology.

Telstra / ACCC
United Kingdom 0.50mm

The range of local lines can be represented by between 0km and 9km of 0.5mm copper cable with nominal characteristics of 168 Ω/km and 50 nF/km (attenuation at 1600Hz of 1.7km)

British Telecom

The published IEC and EN cable standards of Table 1 allow conductor diameters between 0,4 mm and 0,8 mm. NOTE: The EN standards under development (marked with an asterisk in Table 1) do not allow diameters below 0,5 mm.

However, the cabling standards point out that any diameters outside the range 0,5 mm to 0,65 mm are not suitable for installation into “sockets” (i.e. the distribution cables of Table 1). In all cases, the maximum dc resistance allowed for a 100 m conductor is 9,5 W.

The North American standards specify a minimum conductor diameter of 0,51 mm (24 AWG) and a maximum dc resistance of 9.38 W

Fibreoptic Industry Association
New Zealand
  • 0.50mm
  • 0.51mm

Each conductor shall have a nominal diameter of either 0.50 or 0.51 mm and an average resistance at 20 °C not exceeding the limit stated in Tables 1 and 2.

Telecom

Why was this done?... Who knows, lack of foresight, lack of political / public oversight, but most likely it was done to save cost. Now lets factor in the age of the existing network:

More images of our 'apparently still good' copper network


Quote David Thodey:

  • "The copper's been going well for 100 years. I think it'll keep going for another 100."
  • "It’s perfectly OK. There is some copper that is a lot older than others, but copper does not ­decompose."

Yet Telstra claimed in 2003 that the network was "five minutes to midnight". Read More

It may not 'decompose' but it does oxidise.

Also while on the subject of Telstra, it has been found that their standards for measuring and detecting faults in lines have often been found to temporarily destroy the fault, rendering anyone unable to properly locate and fix it. An independant contractor Tim Ashford that has been working in the industry since 1961 has tried to get the attention of major ISP's / government oversight.

Telstra is not mandated to measure ADSL faults, they are only concerned with phone faults. They are not concerned with faults used by higher frequency sevices such as ADSL / ADSL2 and that which would be implemented in an FTTN rollout VDSL / VDSL2.

For connections, Standard Telephone Services are eligible regardless of what is connected at the end of the service (eg. Internet or fax). However, for repairs, only voice telephony faults are covered. This means that non-voice faults such as Internet access or fax faults are not covered by the CSG Standard.
Telstra Policy

Problem: How can the liberal background paper state that only 9% of cable needs to be replaced:

"Excluding MDUs, about 9 per cent of premises are connected using FTTP in the period 2014‐2019.  These premises are assumed to be in  areas with the poorest quality or most maintenance‐intensive copper networks."

or even state a minimum speed of 25Mbps is attainable when Telstra themselves do not test / are having problems with services that use lower frequencies then VDSL? (that is ADSL / ADSL2).

Why does all this matter? Attenuation.

Lets ignore fact for now, and assume that the copper is in pristine condition and wire gauge is sufficient to propagate signal without significant attenuation issues. In short assume that 25Mbps and upwards can be delivered.

Sooner

FTTN

As Malcolm turnbull has stated "you cannot predict the future", while this may be true, you can make a choice based on logistics and R&D done thus far. Therefore we can estimate which direction the technology train is heading and where we will end up in a few years (see below) , if this was not the case the tech laws we know today would not exist.

However not being able to predict the future still holds true for the business decisions of the cut throat, dog-eat-dog world we inhabit. Telstra is a prime example of this (as pointed out in the launch of the coalitions policy).

"You're taking a very optimistic assumption about how quickly you can deal with what is, among other things aswell as being our incumbent carrier, a company that is one of the biggest law firms in Australia. They have managed to delay every initiative that has been attempted since about 1996."

Problem: Tony says "we aren't interested in going to war with Telstra", both policy and party fail to address how are they going to re-negotiate with Telstra to let them modify the agreement and rollout their FTTN network.

David Thodey has been very clear on this point "There will be no renegotiation". But he said the manner in which broadband was rolled out across the nation could be debated.

Translation: Sure we can 'debate' an FTTN rollout but until you pay us the worth of our copper asset (starting price $17.75 billion) we'll hold you to the original agreement. They know FTTH is a good deal as it delivers superior service, in addition fibre OPEX is significantly less then trying to maintain copper, hence you see more returns over a longer period because of the more stable investment (Ongoing costs).

This is why almost 99.5 per cent of Telstra investors voted in favour of the carrier’s $11 billion agreement to plug customers and assets into the project, sparing Telstra the cost of investing in its existing fixed line networks in order to compete with the NBN.

Of course this is all just to get FTTN off the ground what happens when you need asbestos pit remediation as seen in recent months?

This is all not withstanding the indefinite hold they're putting on the rollout / renegotiation with telstra, pending 3 audits.

But wait there's more... "FTTN delays seem to be longer than FTTP. Currently the NBN is between 3 & 9 months behind (depending on who you talk to). In contrast, BT’s rollout that started at almost the same time as the NBN is about 22 months behind". Source: Sortius

FTTH

To Rollout Fibre to 18 million premises in the US as quoted by verizon (2:28) has taken 100 million man hours, we only have only 12 million premises to reach (2/3rds):

  • 100,000,000 x 2 / 3 = 66666666.66666667 (7605.3035076990718153 years)
  • 7605.3035076990718153 / 1000 workers = 7.605 years

FTTH is achievable with the right resources and planning, have there been delays? Sure due to prolonged negotiations with Telstra, a private entity (created by a liberal government), and asbestos concerns (nothing should be rushed if it endangers peoples health).

Does that mean the whole plan should be scrapped and we settle for a system that will be inadequate in 3 - 6 years?. By the time FTTN is finished it will need to be re-upgraded to GPON anyway.

Lets ignore the fact that our telecommunications upgrades could be set back even further, re-examining what technology should be used which was already determined 2003.

Cheaper

Problem: As stated above the copper cables are not suited for FTTN and cannot deliver significant speed gains as have been experienced elsewhere. If you want those gains you have to replace the copper in those areas... how do you propose to get 24 gauge wire (0.5mm)down a duct that was designed for 26 gauge wire (0.4mm)? It's akin to trying to stuff a size 12 foot in a size 9 shoe. In other words you'll have to dig up the street and retrench new ducts to suit the cable.

Not a problem with fibre, strands like human hairs, unaffected by distance or the need for electricity to propagate, fibre can be fed into existing ducts more easily then copper can.

Problem: The distribution or sparesity means you need more nodes to deliver the same broadband speeds due to the fact nodes cannot be centralized properly in non-metro areas to accomodate the last 100 - 400m of copper for every customer.

Population Densities of countries

But hang on a second much of central australia is as yet unpopulated so you cant count that, right?

  • With a rough selection of areas most populated, this brings us down to par with countries in terms of land mass 383,911km².
  • It takes our population per km² up to 60

FTTN is a stop gap solution was conceived to prolong the life of the copper asset. This can be done because as mentioned before (see above) the existing infrastructure in the UK and comparable countries will support increased speeds and it allows the construction of the fibre backbone to get underway. Simultaneously letting consumers experience tangible benefits.

The trends above indicate FTTN is most successfully adopted where population densities are very high. Most likely the reason being because relative distribution of the nodes can be compressed due to comparably lower landmass in other nations.

Also the number of people per square km being so high both CAPEX and OPEX are lowered due to:

  • Easier to Service more people on a per node basis
  • With more feedback from more users per node it becomes easier to isolate where issues are occuring

However all this means naught in relation to Australia:

  • Our existing infrastructure cannot support the speeds required / demanded (see above).
  • Countries that have implemented FTTN are now shifting to FTTH architecture, in other words the stop gap solution has not even sufficed long enough to warrant the CAPEX on it in the first place. Why not learn from their mistakes and skip the unnecessary expenditure to deliver a faster more scalable solution that is FTTH?

Now lets examine the 71% that are to be serviced by FTTN. 8,968,000 / Malcolm Turnbulls 50,000 node estimate = 179.36, so 178 premises will be serviced per node. Now sure in metro and maybe some suburban (medium / high density) housing areas these premises will be close enough together that this will be possible, but for most suburban / rural area's to get a node within 400m of every premises is just not realistic.

Lets take a look at this further:

  • 71% of the 383,911km² that is most populated areas in Australia is 272,577km², divide that by a node every 800m² and you get 340,721 nodes.
  • Of course this assuming that area was covered by all nodes with no fibre backhaul so lets be conservative and reduce it further to around 160,000km² (1/2 the original most populated areas) divide again by a node every 800m² this gives us 200,000 nodes...

The numbers do not add up and aren't even remotely close, this policy is either making false claims as to the speeds it will deliver due to longer copper lengths being present or there is an error in estimates of how many nodes we'll need, therefore affecting the cost overall.

Once this was realised a few weeks after the launch of liberals policy Malcolm Turnbull started talking about mini-nodes, VDSL pit-amplifiers and fibre extension modules.

Lets now ignore the fact that the FTTN implementation has been underquoted and based on countries with quite different existing infrastructure and environmental conditions then our own.

More Affordable

Cost of Copper

Problem: Annual OPEX for copper lines will rise as...

  • The last mile copper ages
  • Cost of manual and skilled labour increases

Node / line maintenance is significantly more expensive then maintaining a FTTH GPON both in equipment required and time needed
Where does the capital come from for this OPEX? Where it always has come from the consumers on the network.

Not to mention as telstra still owns the 'last mile' copper consumers will be subject to line rental fees from a private company that is no longer the monopoly it was, it has to make it's money somewhere...

Cost of Fibre

How about those that want fibre or need it because they're too far away from the node? Taking very conservative numbers from BT's FOD price scheme upon (which among others) the liberal policy is heavily based.

  • 200 - 399m = £600
  • 400 - 599m = £1000
  • 600 - 799m = £1400

With the following charges:

  • Connection fee = £500 (one off)
  • Line rental = £456 (per annum)
  • Transaction charges = £100 (approx)
  • 20% VAT (UK's version of GST)
  • Disregarding wire gauge, and assuming that FTTN is to provide us with the very best, each node would have to be within 400m to deliver the speeds promised. This means the price will be:

    • 1000 + 500 + 456 + 100 = 2056
    • 2056 * 1.65 = 3392.40 (exchange)
    • 3392.40 * 1.1 = $3731.64 (GST)

Starting at $3730 AU and increasing the further away you get from the node. In the coalition policy document it states:

"Coalition policy provides for: individuals to obtain fibre on a user-pays basis where feasible; external public or private investors to propose and co-fund FTTP rollouts if they are willing to put forward 50 per cent of the needed funding; and an explicit future upgrade path to be incorporated into all non-FTTP NBN Co fixed line construction.

$3730 / 2 = $1865 per consumer

Problem: What happens to those that are not upgraded to FTTH by the time the network is re-privatized? Do they get whacked with the original cost of $3730 + whatever the incumbent decides in order to turn profit?

Problem: What about rates? As has been proven OPEX is less per annum to maintain fibre in comparison to copper, how are we assured that those with a fibre line are not paying excess fees for maintenance that will not pertain to them?

Lets ignore the fact that an FTTN rollout will see even greater digital divide encroach in the coming years between users that can afford fibre and those that cannot.

25Mbps Sufficient

But lets assume for a moment that FTTN can be finished sooner, cheaper and will be more affordable. Will 25Mbps or even 50Mbps be enough to serve our needs well into the future?

An inaccuracy at the coalition lauch, Tony said: "At 25 Megs, you can simulataneously be downloading 4 HDTV programs"... So? you can download 4 HDTV programs on 1 Mbps it doesnt mean you'll be finished that hour, that day or even that week. If you're talking about streaming:

  • DVD video (typical resolution 720 x 576) has a bitrate 12.44 Mbit/sec.
  • HD broadcasts (1920 x 1080) with compression have initial data rates of 36 Mbps which is more than adequate to record high-definition broadcasts from any source. Video and movies in production environments have a maximum data transfer rate of 54Mbps. The raw format is 62.21 Mbps.
  • Finally looking into the future 4K has a compressed requirement of 248.83 Mbps.
  • Read more

New codecs being developed such as HEVC (.h265) will help to reduce these data rates, however there is only so far you can go before you start to see artifacts and pixelation. Read more.

Visit the homepage of this site, and imagine a house with the potential to use all of those technologies and more. In particular examine what's under the Entertainment tab (detailing 4k). Note that it takes 20 - 30Mbps to stream 4k (.h265). So what happens if you're watching TV and someone else be it your spouse, kids or even your best mate decides to:

  • Watch something else on their Tablet / Phone?
  • Makes a video chat call?
  • Logs into work / school server to check on a project?

Anyone that has a slower connection realises what contention does to your service, without significant investment into QoS it slows down to a crawl and at worst is unusable.

25Mpbs is most certainly not enough for the future.

An interesting point here, you may remember some time back there was talk about Mr turnbull owning shares in french telco companies planning to roll out fibre to a majority of the population by 2020. His response was:

"he thought they were good value". France Telecom's shares currently yield about 12 per cent and recently hit historical lows.

To add insult to injury he blatantly lied about this fact in the recent lateline interview

"No, they're dying VDSL, I promise you. They're like every telco in the world: they're doing a bit of both, and as the VDSL technologies have improved, they're doing much of that. Can I just make this point about advanced manufacturing ..."

Correction: They WERE doing a bit of both but have concluded (just like NZ):

"We have also made the choice of the fibre optic to the home because we think it's the best and the most sustainable solution to bring quality, very high speed broadband to the people"
Fleur Pellerin, France's Minister for Innovation and the Digital Economy

But that still doesnt explain why now? Sure they hit historic lows but obviously you have to see some money in it. In other words you had to see some dividends being made, else you wouldn't have bothered at all. What else influenced your decision?

Could it be because the french government were investing in 4k and that the only way to deliver live streams of this content is though fast internet access...

Lets ignore the fact that even if properly implemented FTTN can only provide for needs over the next 3 - 6 years.

Quantum Technology

Malcolm Turnbull has played to the fear of the uneducated consistently feeding them lines such as:

  • "Why invest in fibre now when new technology could make it redundant in a few years".
  • "Because we dont know what the future holds".

This is either an uneducated guess or a blatant lie, no matter which way you look at it, it's not terribly appealing. Australia is one of the countries at the forefront of developing the next evolution in digital computing and communication.

Note clip 2: "Photons (in other words light) via a fibre optic cable"...

While this technology is still in its infancy (experimental stage) the communication side of it deals more with securing data over extremely fast links (facilitated by fibre). But do we know we're not the only ones heading in this direction? In other words barking up the wrong tree?

  • Germany are conducting similar experiments
  • The US have already admitted to using a quantum entanglement network at Los Alamos for the past 2 years. Read more

Lets ignore the fact that we know which direction we're taking, leading the world in the field of next generation computing and communication.

Other Myths

Monopolies

The assertion that a government owned monopoly is a bad thing, that it:

  • Discourages competition

    Within the NSW metro area alone: 24 providers with 86 Broadband bundles and 223 Broadband only plans... seems pretty cometitive...

    Not only this but since all RSP's should have the same ability to deliver reliable fast broadband, the subscriptions become about the perks and what else they can throw in with the deal. This should have an impact on mobile phone / pay tv bundles benefiting comsumers through more competition.

  • Is aiding in censorship

    Under Kevin Rudd's original plan for the mandatory internet filter scheme, outlined in 2007, it was anticipated ISPs would be forced to block all material categorised as "Refused Classification", including bestiality, sexual violence, detailed instruction in crime, violence or drug use and material that advocated a terrorist act.

    While this does merit question, who watches the watchers? And raises abuse of power issues, this concept does merit some thought.

    People like their privacy, subsequently the time consuming and costly process of implementing our own filters was abandoned in late 2012 in favor of blocking those sites under interpol's worst of list, a method already in use by some Australian ISP's. What is that list?

    It should also be noted that since that time, classification standards in Australia have been reviewed and altered particularly for games.

  • Will let the government monitor you more closely

    Use of any public infrastructure such as rail, buses, toll roads, parking lots and even private ones such as your own business and home will leave a paper trail of some form such as tax or insurance records. This is all not withstanding ISP's and governments alike already have this ability at their disposal (PRISM) and (to the best of our knowledge) have not abused it thus far.

    Unto those that dislike the potential oversight, i ask what have you to hide?

On a final note addressing monopolies, would you rather have:

  • A semi-transparent government body owning / developing the infrastructure we use on a day to day basis?
  • A private incumbent such as telstra with almost no say in the direction it takes as to development?

This is essentially what the howard LIBERAL government acheived in 2006 when it sold off telstra T3 shares, reducing the Australian publics say in the development of our infrastructure from 51% to a mere 17%. With only private investors to appease the company's quality of service rapidly declined. Between October - December 2008:

"Complaints about Telstra's Bigpond internet service climbed 65 per cent, from 3382 to 5607." Source

This can only increase with an aging copper network and a growing population, however it's not all bad news.Since the inception / rollout of the NBN complaints have rapidly decreased going from 42,685 in 2009/10 to 30,856 in 2011/12. Source TIO

Why should the taxpayers pay for this infrastructure? Because the business community will not embark on a project where the business case and profit streams are unknown.
Hence (as was with telstra over the last decade) the infrastructure will simply not be built.

Lets ignore the fact that the people that landed us in this mess in the first place, valued capital over infrastructure development and they are attempting to do so once again.