Abbott 'no Bill Gates' ... but is Turnbull?

Abbott 'no Bill Gates' ... but is Turnbull?

Summary: Bill Gates still hasn't lived down his 1981 proclamation that 640KB of memory should be more than enough for anybody. Twenty-nine years later, Malcolm Turnbull seems set to repeat history, recently challenging NBN proponents to explain why anybody needs more than 12Mbps.

TOPICS: Broadband, Microsoft, NBN

Bill Gates still hasn't lived down his 1981 proclamation that 640KB of memory should be more than enough for anybody. Twenty-nine years later, Malcolm Turnbull seems set to repeat history, recently challenging NBN proponents to explain why anybody needs more than 12Mbps.

"You tell me, what are the great productivity enhancing applications that cannot be accessed by 12Mbps broadband?" Turnbull asked, and quickly rebuffed suggestions that future growth would push through this ceiling. "The only thing that will drive high speeds for residential usage," he said, "... is going to be bigger and bigger files. And that can really only be higher and higher-definition video. You've then got to ask yourself, should the taxpayer be spending $43 billion when we know there are so many infrastructure demands where there is a screaming need now."


12Mbps should be enough for anybody: is Turnbull channelling an early Bill Gates? (Credit: David Braue/ZDNet Australia)

Arguments about one NBN speed versus another are always bound to fall short of the mark, because they are so ridiculously subjective: as I have previously pointed out, not everybody has the same requirements, and ruling out new usage models is a dangerous exercise in Gates-ism. Even focusing on specific speeds is a mistake: 100Mbps is a nice round figure to hang your hat on, but experience has shown that many Tasmanian customers are just happy to get the 25Mbps they've been promised with ADSL but cannot get. That's fine. But Turnbull is making a fatal flaw by characterising all potential NBN users as home users with a predictably low-tech set of requirements that only extends as far as HD video.

The fact is that over 35 per cent of Australian businesses are home-based (according to January 2010 ABS figures); 47 per cent employ one to four people, and 13 per cent employ more than four people. There is no geographic breakdown, but I think it's safe to assume that the majority of these home-based businesses would in fact be located in the suburbs, where broadband has long been notoriously hit-or-miss.

Now, imagine four people crammed into a home-based business, fighting for a broadband connection that might offer up to 12Mbps for downloads and struggling to complete phone calls and video-conferences with clients and suppliers using woeful 512Kbps-class upload speeds. At the same time, the kids are home in the other room, running streaming video and gaming that's conflicting with the business traffic. Suddenly, that theoretical 12Mbps maximum, which Turnbull argues is so far beyond conceivable usage models, doesn't look like anywhere near as much as it used to.

Businesses rely heavily on the internet: 74.8 per cent were using it in 2007 when the Australian Bureau of Statistics did its figures, and I'd wager that has increased dramatically in the past three years. All linked internet access with business productivity; the Victorian Government even backed figures that quantified this benefit at $5000 per year, per business. All would suffer under a plan that promised just 12Mbps, and in practice would deliver much less to the majority of the population.

Over 35 per cent of Australian businesses are home-based ... it's safe to assume that the majority of these home-based businesses would in fact be located in the suburbs, where broadband has long been notoriously hit-or-miss.

Heck, I don't live in or even near an official broadband blackspot and my ADSL2+ service was delivering just 2Mbps before the service gave out on me; not even the Coalition could improve this to 12Mbps without building a new exchange closer to my house. Is that really Turnbull's plan? Because if it is, I respectfully submit that he's dreaming: peppering the country with new copper-loop exchanges is hardly progressive telecoms policy. And if it's not his plan, he should explain how he's going to get me — and millions of others in similar situations — a competitive 12Mbps broadband offering without squashing us all onto wireless broadband where HD video wouldn't even dare to tread.

I have previously mentioned that I have a 100Mbps Optus connection that is faster than 12Mbps even if it is totally anti-competitive. Yet I am still struck with its remarkable sameness to non-accelerated options.

I may have up to 100Mbps downstream, but I rarely exceed 10Mbps and it still takes me 40 minutes to upload 10 minutes' worth of HD video, comprising 225MB of data. That's way, way slower than 100Mbps; an average upload speed of just 750Kbps, in fact. And that's on what is basically the fastest consumer internet connection available today; users on wireless, ADSL and cable will struggle to reach that figure.

From one perspective, Turnbull is correct: no one user currently really requires over 12Mbps downstream. But what he is not talking about is the upstream speed, or the massive logjam that would occur if two people in a house with a 12Mbps connection tried to use 12Mbps services at the same time. Or if someone in that house is watching HDTV over their new FetchTV service. Or if, heaven forbid, two people are watching different channels at the same time. Or if — as is the case in one third of all Australian households — the home is hosting a small business with real business requirements and expectations.

Back to Turnbull's 12Mbps challenge. It took me less than a minute to list a number of things businesses and home and home-business users can't do well with a 12Mbps/500Kbps connection:

  1. Telephony: small businesses hate conventional, expensive, inflexible PABXes. Hosted options from Telstra, Fonality and others give them the same features without the equipment. But they need lots of bandwidth in both directions, with little latency, and high reliability. ADSL2+ does not provide this.
  2. Hosted applications: software-as-a-service (SaaS) offerings have been popular among small businesses because the services give them access to high-end capabilities at a low, predictable price. But those services also require fast, reliable two-way bandwidth that ADSL2+ cannot provide. We already know Australian businesses are warming to SaaS and its broader-reaching cousin, cloud computing, but without adequate bandwidth in both directions they'll be skydiving through the clouds without a parachute.
  3. Remote learning and conferencing: communications is critical for small businesses, especially home-based businesses that rely on communications to make up for their decentralised location. For these companies, extensive customer outreach makes all the difference, and they complement this with online product presentations, online learning to gain new business skills and qualifications, face-to-face customer meetings, and more.
  4. Households with more than one computer: 12Mbps might be enough for one person, but if your household has teenage children, and millions do, you're not likely to be the only person online at any given time. Divided several ways, 12Mbps won't go anywhere near as far.
  5. Households with more than one TV: again, 12Mbps might be enough to keep up with one FetchTV or Foxtel IPTV stream, but once someone in another room decides to watch TV, you're going to have problems.
  6. Branch offices: branch offices are likely to be in strategic outer-suburb locations rather than fibred-up CBDs. They'll need access to the same hosted apps I mentioned earlier, but they also need a fat, effective pipe that lets them access company systems as if they were in the same building. With in-building networks running at 100Mbps both ways, a 12Mbps/512Kbps ADSL2+ or wireless connection becomes like pushing a watermelon through a garden hose.
  7. Remote backup: politicians may scoff, but businesses know that good backup is as important to business as customers are. But they've struggled getting data to and from their offices to central datacentres: anaemic wide area network (WAN) links couldn't cope, while physically moving backup tapes hundreds of kilometres for safe storage is clumsy, expensive and error-prone. Companies can sidestep this problem by backing up data to cloud-storage providers — or could, if they could get more than 500Kbps upstream. At that speed, a typical multi-gigabyte backup takes hours upon hours to complete. These services are also relevant to consumers, who are producing photos and home videos by the gigabyte but cannot effectively back them up.

There are more applications; feel free to share others you can think of below. But the gist is that bandwidth realities create problems for NBN opponents that show a chronic lack of imagination in their visions for the future. Turnbull is arguing for the status quo: woeful upload speeds that limit home and business users' participation in emerging online economies. And if you consider what he's actually saying, the huge disparity between his vision of adequate speeds and the realities of what's out there, threaten to make his speed argument as infamous an understatement as the one Bill Gates made 29 years ago.

Topics: Broadband, Microsoft, NBN


Australia’s first-world economy relies on first-rate IT and telecommunications innovation. David Braue, an award-winning IT journalist and former Macworld editor, covers its challenges, successes and lessons learned as it uses ICT to assert its leadership in the developing Asia-Pacific region – and strengthen its reputation on the world stage.

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  • I do think we need more then 12mbps speed rates , what I disagree with is the cost of the project. Labor was over budget with it's Macquarie link for trains imagine what the real final cost of the NBN will be.
  • I Feel like giving Turnbull the BOOT literally !
  • Great points above, slow upload speed for ADSL is also limiting a lot of potential applications (graphics, medical images, data feeds).

    The naysayers would do well to look at the phenomonal growth in data capacity and storage worldwide before making Bill gates like statements. There is a real risk we are shooting ourselves in the foot by thinking the status quo is in any form acceptable.

    "By 2013 the amount of traffic flowing over the internet annually will reach 667 exabytes, according to Cisco, a maker of communications gear. And the quantity of data continues to grow faster than the ability of the network to carry it all."
  • Heck, I recently helped out a small business (half dozen staff) upgrade their network from 10 to 100Mbps because it was running a bit slow for them. Just a typical admin type business, email, word documents, printing and the like - generally no video or anythig typically high bandwidth. With the number of computers in the home increasing and and more internet apps being used (gmail, facebook, school portals etc) its easy to see how we could be pushing the limits of 12Mbs real soon.

    I am currently on around 10Mbps with ADSL, both my partner and I work from home (me remote access, my partner internet business) and have 2 young kids who's internet usage is light to medium. If I tried to download say a disk image from technet, my partner immediately starts complaining that the internet is slow. (As an aside, the complaints I would have to put up with if we had to put up with a crappy wireless connection would be unbearable!).

    Personally I would rather see $40B spent to get something for the (near) future than spend $14B to end up with what I already have.
  • Politicians are not Bill Gates.
    And it's not like Bill Gates is a really good business man either, nor is Adobe.

    Charging hundreds/thousands for Software, when it can be sold for half of what it is, and get more sales and balance the profit from it.

    Considering that Coalition has in the past made several blunders, including their previous plans and current plans for broadband, not to mention their biggest blunder of Selling Telstra wholly. Selling the network without even upgrading it to at least FTTN back then, would have given less political and media bs than it is now, and now we face a much larger hurdle, due to that.

    And Why should we reset the history books at what ever Malcom or Abbott, or indeed the entire Coalition Party say or do?

    They have a 6 Point plan for this, 9 Point Plan for that, 4 Point Plan for another policy, they talk about Asylum Seekers when they are in a unconformable position or don't want to talk about another policy or announcement they made.

    Any other technology outcome, would have been better served 5 years ago, but now we have competition in both Wireless and Fixed Line Market, we do not need another new network or a patch work.

    It's time to do it right, it's time to finally spend big.
  • Nice article. I can think of a few more applications one that I mentioned over at itnews was video conferencing while FTP transferring files like photos to work collaboratively on them.

    Of course this sort of thing is reliant on faster upload speeds something the substandard coalition plans dont address. They think it's all about downloads and get dazzled by all the "big" numbers which in relative terms are not really that fast, if they understood this they wouldn't be making stupid statements like "12mbps is enough" No Mr Turnball, just no, maybe it is enough for you and Mr Abbott to send love letters to each other via email but for the rest of the forward thinking world who can perceive applications that your old feeble Victorian era stream engine thinking brains cannot even comprehend it is not enough, not nearly enough.
    Hubert Cumberdale
  • Can Malcolm Turnball tell me of an internet technology that delivers UPSTREAM transmissions of 12mb/s??? Nope... didn't think so.
  • That 12mbps speed is highly misleading...he is speaking of a peak speed of 12mbps, not a minimum speed. To get a minimum speed of 12mbps, you would have to either put 2 wi-fi towers per block on 4G (100mbit), or increase the number of exchanges into the 10s of thousands for ADSL2+.
  • Poor Malcolm, I suspect he would really love to be on the other side of the debating table, they have so many more good points to argue. As he's not there, he has to go with what are the easy political selling points and it's easy to say it's extravagant when people really have no idea the impact this will have on their lives in the next 20-30 years.

    For mine, I can just look at my home internet packages. 10 years ago I was on a 100mb download/ month which was fairly common. Now 100gb is fairly common. If this doesn't indicate a need to build something far beyond our current needs I don't know what does.

    Keep pushing the upload point Dave, this is being totally ignored by the mainstream media and is such a key point.
  • Surely if Malcolm was the Great Leader he once tried to be, he would lead Tony on the path of righteousness and convince the Great Neanderthal that the Libs' anti-NBN policy is completely, technically the wrong policy so stop pushing it.
  • fact is that over 35 per cent of Australian businesses are home-based.

    43Billion so your mum can sell her jams and preserves on ebay.

    Totally worthwhile.
  • A good article, but neither it, nor those commenting on it, have mentioned the fact that, whatever plan were to be implemented, would not be delivered for at least five and probably 10 years. Debating what we need now when the wide-spread Internet is barely 10 years old, misses a most important parameter; it's not just about speed, delivery date must be considered too.
  • "Bill Gates still hasn't lived down his 1981 proclamation that 640KB of memory should be more than enough for anybody"

    I don't think Bill Gates ever said this, he has always denied it, and I have never seen a credible source for the quote.

    But back on topic, Malcolm Turnbull reminds me of someone in a debating competiton who has been assigned the point of view he doesn't agree with. He comes up with arguments and rebuttals to try and "win" the debate, but his heart doesn't really seem in it. You get the feeling he would much rather be on the other side.
  • But let's not forget that he's under orders from the Mad zmonk to "Demolish the NBN"
  • There has been an explosion in Data usage and yes into the future there will be requirements for more bandwidth but why should the tax payer pay for the FULL roll out NOW? Start off small build the business case and then roll out. Start with the backhaul then the schools, Medical centres and alike then businesses then homes... what would be wrong with that? The first would pay for the second. Build the business so the tax payers don't have to foot the bill!
  • I like how everyone points to roads... but this is like build all of the roads at once... So many of our roads need a rebuild but we are doing it as we can afford it. Why should BB be any different?
  • I travelled by campervan around Yugoslavia in the mid 1970s and was surprised by the number of partly build, but occupied houses. A hitchhiker explained to me that because they had no capital market to speak of, people built their houses as they had the cash to buy a window, a door or whatever.

    This seemed like an inferior system to what I was familiar with where one goes to a bank or building society, borrows the money, builds the house in the most efficient way from the point of managing the project and pays it off while one lives in it.

    We have sophisticated capital markets including cashed up superannuation funds so why not upgrade the communication system in the most efficient way, so the benefits flow to everyone at the earliest time? But instead, we stress on the question of Big Bad Debt and look for the smallest band-aid approach which costs more in the long run and delays the benefits.

    People may allude to Mr Micawber’s view on exceeding one’s income by as little as 6 pence in the pound. But Micawber was not talking about borrowing to finance assets delivering long term benefits, he was talking about borrowing for current expenditure. There is a (forgotten) difference.
  • Please can we have reality check... All the stuff David put up doesn't need fibre! Fibre is made for 100Mb/s and up! Why trying to crack a nut with a sledgehammer... ??

    Anyone heard of Ethernet over bonded copper for instance?? Geez

    Technically (sledgehammer) and commercially (there are far better things to spend $43b on!) FTTH across the wide and breadth of this country is simply rubbish. Sorry to all the "blue sky" guys ...but that is reality...
  • "43Billion so your mum can sell her jams and preserves on ebay.
    Totally worthwhile"

    It absolutely is! Small business is the backbone of our economy...and that is the ultimate in small business! It greatly increases productivity, eases the need for the Dole, and it keeps mums, dads, and the whole family a lot happier.
    I can't say the same about tax cuts for the rich...:)
  • "Anyone heard of Ethernet over bonded copper for instance?? Geez"

    You cant be serious? Are you even aware of the limitations of these sort of solutions? I suggest you do some reading... yep that IS reality.
    Hubert Cumberdale