Tuesday, 30 July 2013

NBN: Turnbull a New Age Luddite?

Is Turnbull a 21st Century Luddite? If he succeeds in his mission to "Destroy the NBN", then just like mobs in the early 1800's destroying textile machines, the answer is a resounding, Yes!

There have been any number of basic technology changes, not only in our lifetimes, not just back to the "Industrial Revolution", not just in the Iron & Bronze Ages but all the way back to the first ancestors of genus "homo". Optical Fibre has replaced Copper where it matters in long-haul and back-end over the last 25 years, the "last mile" is the last part of the puzzle.

Opposing, not facilitating, this inevitable step-up in technology is as mindless and stupid as opposing the change to jet engines in the 1960's. The arguments are identical: "petrol engines are really high-tech!", "they're proven!", "all the cool kids are using them!" and "we have to use existing assets cost-effectively" and "consumers want choice!".

Jets displaced petrol engines in airplanes, creating a whole new era of air-travel and freight: safer, faster, cheaper, more comfortable and more reliable (higher payloads, flying over weather, better electronics, 10+-times better fuel economy...). Looking back, why would anyone have questioned the transition?

Turnbull appeared on ABC Shepparton Radio (transcript) and multiple times mentions the VDSL/FTTN projects by local versions of Telstra, said they know better than us in Australia:
I mean, are the Germans idiots?  Are the British idiots?  Are the Americans idiots?  Are the Belgians idiots?  Are the Austrians idiots?
Every single one of those examples are NOT relevant to us: incumbent Telcos are rolling out broadband. NBN Co is a new entrant with no existing infrastructure or assets.

The key difference, and Turnbull is fully aware of this as he mentions it often in his Node Plan, is that only in Australia is the Broadband rollout not being done by the local version of Telstra. When you have to pay for access to existing infrastructure, around half the cost of connection, there is no choice between copper and fibre.

If, like Telstra, you already own the Copper and everything associated with it, extending it's life and not spending 25% more running fibre is a good idea. Why? Because you can charge customers twice. Once for the Copper, then again in the future for the "upgrade" to fibre.

Either Turnbull does NOT understand the economics of incumbents, like Telstra, rolling out Broadband, or he does understand it fully and is being purposefully disingenuous  and misleading. It cannot be otherwise.

Turnbull is either uninformed and incompetent or knowingly "spinning" the truth for his own ends.
Neither of these options qualifies him as suitable for a role as Minister of the Crown. This is not a courtroom battle, the future of Australian economic competitiveness at stake, no less.

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