NBN broadband prices will drop: Quigley

Summary:Despite claims to the contrary, broadband prices will fall over time on the National Broadband Network (NBN), according to a letter from NBN Co CEO Mike Quigley.

Despite claims to the contrary, broadband prices will fall over time on the National Broadband Network (NBN), according to a letter from NBN Co CEO Mike Quigley.

As part of his argument against the project, Shadow Communications Minister Malcolm Turnbull has frequently pointed to the McKinsey Implementation study which outlined the need for price increases for broadband in order for the government to make a return on its investment.

However, in a letter (PDF) sent to Communications Minister Stephen Conroy and Finance Minister Penny Wong on Friday outlining what he plans to talk about in confidential briefings with crossbench MPs and Senators on the NBN business case this week, Quigley said the business case projects broadband prices "will be reduced over time".

Quigley also said he plans to outline in the briefings that the peak equity requirement for the project is in line with the McKinsey implementation study, and the total capital expenditure for the project is much lower that than outlined in the study because it did not take the $11 billion Telstra Heads of Agreement deal with NBN Co into account.

Quigley stated that some parts of the business case would have to be excluded from the briefings.

"Certain information may be of commercial significance in a number of competitive procurement processes which NBN Co currently has underway and those which may be conducted during the life of the project, including commercial negotiations with Telstra and other parties," Quigley wrote.

The government has refused to release the business case until December after parliament has finished sitting for 2010, despite an order from the Senate last week to release the document. Originally the government had also sought to have the politicians involved in the briefings on the NBN business case sign a seven-year confidentiality agreement, however after criticism from the Greens and Independent Senator Nick Xenophon, this was narrowed down to just two weeks.

Conroy has previously argued that the reason the case could not be published before December was because parts of the document would have to be blanked out due to commercial confidentiality reasons, however Shadow Treasurer Joe Hockey told ABC's Insiders on Sunday that this could be accomplished in a short amount of time.

"They can copy the document into another file and just press edit delete for those areas that are sensitive. And I'm sure they can get the document out pretty quickly," he said. "I mean 400 pages isn't that challenging given that the budget is thousands of pages, thousands of pages. And so many other documents released by the government on a daily basis are literally thousands of pages."

"This is just a try-on. They're trying to avoid something and it looks that way and it probably is."

Topics: NBN, Broadband

About

Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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