Thursday, October 21, 2010

Australia's National Broadband Network (NBN) not viable

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The Australian Labor government is proposing legislation to spend $43 billion on a national broadband network. It is a huge number. People are apparently arguing that we don't need a consultants report because:
"the ultimate commercial viability of the NBN is not the issue, because state-of-the-art communications infrastructure is crucial for the country".
This is folly in several respects. This judge investment assumes that 'fibre' is state of the art. The problem with this view is that the government risks rolling out a network for large sums, which cost half as much if they wait a few years. Where is the logic in bringing forward so much expenditure. People should also apply some critical thinking to the 'report' which provides cost analysis to this project, because too many consultant reports are simply not very good at projecting costs...and more importantly, revenues.
If this is a viable decision, then it does not need government to make it. In fact it could be solely undertaken by Telstra at no cost to the government. Of course it only makes sense because its government funded. This will be another white elephant like the Ord River scheme....only viable 30 years after its initial development. i.e. We would have saved 2x the project value if we had delayed the project 20 years.
Andrew Sheldon

ConvinceMe.Net - Anyone up for a debate?