Is Scenario 6 really the best NBN choice?

Is Scenario 6 really the best NBN choice?

Summary: The NBN Co Strategic Review proposes that Malcolm Turnbull change the network into a hodgepodge of access technologies known as Scenario 6. But will this cheaper Optimised Multi-Technology Mix look as appealing during 2014 as relative benefits are weighed and strategies revised?

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The much-vaunted Strategic Review can't have been everything Malcolm Turnbull wanted for Christmas, since it exposed the soft underbelly of the Coalition's NBN policy and left him in an extremely difficult position going into 2014 as he seeks to execute a series of minor miracles in very little time.

The magnitude of the turnaround task facing Turnbull was not lost on a family member, with whom I shared a beer and the many NBN revelations that surfaced during December, clarified Turnbull's position going into 2014 eloquently: “So, basically, he's pushing shit uphill."

ForkInRoad
The NBN has reached a fork in the road in 2014 – but which route will Turnbull take? Screenshot by David Braue/ZDNet Australia

That just about sums it up. Yet the fact that a review contrived from the get-go to deliver a preordained outcome would put the government that commissioned it in such a difficult position, reflects the ever-challenging dynamics of a heavily politicised project that, almost refreshingly, enters 2014 free from the looming threat of a change of government or even of PM.

As questionably constructed and selectively factual as it may have been – more on that in coming days and weeks – the review has at least given the industry a touchstone from which we can productively and consistently ponder the next steps for the project.

For the first time in his years in a communications portfolio, we have a document loaded with empirical evidence that Turnbull cannot dismiss out of hand. No longer can he simply try to discount considered technical opinion by labelling it as outdated and partisan, as he did when NBN Co issued clear warnings during the caretake period that the FttN architecture presented all manner of complexities.

Despite Turnbull's repeated attempts to politically distance himself from those NBN Co findings, which were spelled out in great detail at ZDNet Australia and elsewhere, the same issues reared their ugly heads throughout the Strategic Review – which he now has little choice but to accept as gospel.

Ditto the latest figures from the NBN rollout effort, which suggest that the project is indeed finally starting to ramp up just as the previous Labor government had promised it would, over and over and over again. Some close to the project have told me that, had there been another six months for the NBN to continue growing before the election, Turnbull's arguments would have been cut off at the knees; after significant efforts to improve the rollout and trim costs, the NBN would have become recognised as a project that was actually working.

For the first time in his years in a communications portfolio, we have a document loaded with empirical evidence that Turnbull cannot dismiss out of hand.

This reflects the natural process by which massive infrastructure projects slowly gain momentum, particularly after the fits and starts encountered by the NBN effort: at some point, enough changes will have been made, enough problems fixed, that things will just start to work.

As the latest figures show, the NBN is now getting to that point – just in time for it to be potentially gutted by Turnbull in an extraordinarily complex change of direction that is outlined in the Strategic Review as Scenario 6 and includes 18 specific tasks for the government to now undertake.

If you haven't read the document yet, it's worth a bit of your time (get it here) and thought before you blindly accept NBN Co's cost-based recommendation that Scenario 6 – which involves muddying the current FTTP-fixed wireless-satellite rollout with the addition of fibre-to-the-node (FTTN), fibre-to-the-basement (FTTB), and fibre-to-the-distribution point (FTTdp) as well as the takeover of Telstra and Optus HFC networks – is the best way to go.

Despite the many legislative, technical and procedural difficulties it presents – not to mention practical showstoppers and as-yet-uncalculated costs – this scenario is supported mainly, through my careful reading at least, because it will deliver some sort of broadband sooner and more cheaply than the current rollout. All in the name of presumed cost savings, the report glosses over the real-world performance of technologies that have never been tested in anger within Australia.

This is a fundamental problem with the Strategic Review (or, perhaps, limitation is a better word since the Review did satisfy the limited scope it was designed under): it deals only in costs, and presumes to recommend a technological direction without regard for the real-world implications of the technologies it advises.

It says nothing about the potential benefits of any technological approach – nor does it imply that they even matter, even though everybody involved in this discussion knows that they vary considerably between the six scenarios outlined.

If he's honest about NBN reform, Turnbull must this year open himself to considering all options and allowing his ultimate decision to be tempered not just by the cost-based recommendations of the Strategic Review – but by the service and revenue-based story that will be spelled out in the cost-benefit analysis (CBA) to come.

If he's honest about NBN reform, Turnbull must this year open himself to considering all options and allowing his ultimate decision to be tempered not just by the cost-based recommendations of the Strategic Review – but by the service and revenue-based story that will be spelled out in the cost-benefit analysis (CBA) to come.

The cheapest option isn't always the best one, and Turnbull would be doing himself and the country a gross disservice if he accepted the Strategic Review's assumptions without balancing them against the relative benefits outlined in the CBA. If the more-significant long-term benefits of Scenario 2 mean the Coalition should spend a little more now to do Labor's rollout properly, he should be open to that (Scenario 2 basically involves building Labor's FTTP network but using cheaper building materials and faster rollout techniques to shave $10 billion plus change off the cost). Ditto Scenario 4, which leans more heavily on HFC and the attendant complexities that strategy includes (more on that later, too).

In the end, however, Turnbull would need some very, very good reasons to ignore his own review's advice; perhaps he'll find them in the many further studies yet to be done this year.

In the meantime, we'll all be waiting and wondering just what form the new NBN will actually take. Although 2013 saw many questions about the future answered, 2014 has opened with even more questions still very much up in the air.

What do you think? Is Scenario 6 a foregone conclusion? Or could the CBA give Turnbull the excuse he needs to backtrack towards fibre?

Topics: NBN, Broadband, Fiber, Government AU, Telcos, Australia

About

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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Talkback

23 comments
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  • So here we are in 2014, a new year for GimpCo and so far it's not looking too good. Paul Budde describes the coalition clowns "broadband" "plan" as a dog's breakfast. I find myself agreeing with that assessment. Sadly it seems Turnbull has painted himself into a corner, with only 1081 days to go to deliver mediocre speeds to a few dotted around the country many will be wondering why they even bothered, the rest of us will simply say "this is why you should have continued the FttP rollout morons durrrrrrrrrrrrrrrrr"...
    Hubert Cumberdale
    • OMG

      OMG Hubert do they still have that long in power to inflict maximum damage. The clowns are now in charge of the circus, unfortunately the outcome will not amuse me.
      BoomerMMW
    • are you always

      Hubert are you always on zdnet or something. Without fail you are always the first poster on NBN articles.

      We get it you don't like the coalitions plan (and i agree with you).

      I think the real question is when the coalition proceed with Wing Attack Plan 6 and it fails to deliver on time and on budget is whether or not it will lose the next election for them?

      I think not. I think the coalition could deliver a dogs breakfast and the electorate will lap it up because really people vote on the one issue that gets a never ending airplay (people in boats).
      chugs1
    • hmm

      Did Turnbull paint himself into the corner or was he forced to do it by Abbott?
      Zhyr
      • Did Abbott…

        Did Abbott paint Turnbull into a corner forcing Turnbull to repaint?
        richardw66
  • Is Scenario 6 really the best NBN choice?

    No!
    cameronwatt
  • Is Scenario 6 really the best NBN choice?

    THis reminds me of a something...

    "A fool knows to cost of everything and the value of nothing."

    Malcolm... are you there?
    cameronwatt
  • There is Nothing like a CBA

    If you happen to be a CPA.

    If you happen to have just a little life experience you will be aware that not everything can be reduced to figures and shown on a spreadsheet. I think it is time the Government should be examining and providing answers to the following:

    1. Do we need to replace the current copper wire we use for communications in the next 10 years?
    2. What is the best material at a reasonable cost that we can use to replace the copper.
    3. Are we able to do this so the infrastructure in Bourke is the same as in Melbourne as far as possible?
    4. Is the overall communications system going to be able to meet the foreseeable needs of individuals, businesses, governments and educators and support the systems they will need?
    5. Can a new communications system be made available to anyone, anywhere in Australia at the same basic price before enhancements?
    6. Can the practice of vertical integration be effectively outlawed?

    Not a lot of those answers would fit into a CBA and in fact these are the questions that should be asked and answered well before you start thinking about a CBA.

    One of the reasons that the Coalition has a problem with their communications policy is simply because they think everything should fit into a CBA or be abandoned.

    Yep there is nothing like a CBA to stuff up good policy.
    Bob.H-819a5
    • CBA???

      A CBA will tell those who think it's important exactly what they want to hear.

      If we based decisions on a CBA nothing that costs money like roads, hospitals or the can would get built.

      As it is - to move this country forward we need the real nbn - which won't get rolled out until a new Labor government comes in to fix this.

      Why couldn't the LNP leave it be, make some changes to the roll out for timing and potentially save some money, but leave it as the nbn we needed.
      ice444
  • Why

    He wasn't listening to advice before the election.

    Why would he listen to his own advice now
    JasonKent
    • Thunderbirds are GO!

      Malcolm after all is a puppet, a sacrificial one at that, and to be honest my respect for Mal died when he allowed phoney rabbit to take the top job from him. ( Hmmm Liberal bullshit about backroom power struggles in the party, doesn't happen in a good conservative government. (Whilst we are at it, what do the first three letters of conservative spell out. CON. Thanks folks for reading this.
      BoomerMMW
  • Excuses?

    If Malcolm truly wanted an excuse to backtrack, he would have allowed the review to operate without the constraints he imposed in order to deliver his pre-ordained recommendation.

    It is clear that doctrine alone is driving LNP policy in this area (if not every area) and the model selected prior to the election will be followed regardless of cost to the budget, people and long term benefit to the economy.
    The only hope is that they will dither about so much that they will not be able to inflict terminal damage to the project prior to the next change of government.
    Goresh
    • Backtrack?

      What matters most to the Libs, I would argue, is staying in power. The only way Turnbull will backtrack on scenario 6 to something eminently more sensible like scenario 2, is if it becomes politically expedient to do so.

      With the ramp-up of FTTH over this entire year, I think we will start to see mounting political pressure from voters who see the incredible benefits fibre brings to their relatives and neighbours, and will want the same thing for themselves.

      With so many incredible hurdles to overcome in such a short space of time, many of which may likely result in a cost and/or time blow-out, scenario 6 will quickly reveal itself to the layman as a disastrous option - IF we keep up the media coverage and commentary.

      So I remain cautiously optimistic that Turnbull will backtrack, provided we keep up the pressure. Meanwhile I find myself wandering through the greenfield estates being built near me in Casey, staring longingly at the fibre, and wondering if they'll ever stretch it just a bit further over the road to me, or if I'll be stuck on pitiful ADSL2 until I get equally pitiful FTTN.
      Modeski
  • Cheery picking

    If the NBN was allowed by the previous government to cherry-pick the somewhat newer and denser suburbs (1985-today), it would have sped up the rollout, avoided the asbestos mess and delivered probably an extra half a million homes - simply by delaying the hard, dangerous, and remote areas till later.
    myne-819b4
    • Think it through

      What was once the NBN is left with the expensive to provide lower revenue components, can never repay debt and be a burden on the taxpayer for ever.
      The private sector mini monopolies will fight tooth and nail to remain monopolies. As such they will never upgrade and waste shareholders funds doing so
      Abel Adamski
  • could the CBA give Turnbull the excuse he needs to backtrack towards fibre?

    The answer is no, Henry Ergas.
    Eumenes
  • CBA schmeeBA

    The CBA will just like the strategic review, in that it will deliver the exact answer Turnbull wants. He has stacked the panel preparing the CBA, just as he did with the advisors and consultants he hired to "oversee" (read: prepare) the Strategic review. Henry Ergas' views on an FTTP NBN are well known. He has made forecasts before that show he is way out of the ball park in his estimations, and lacks as much future vision as Turnbull does. This coupled with his Liberal Party bias more than adequately demonstrates the CBA will be worthless.

    The CBA should have been done before the election, and before any sort of policy was decided. In the business world a CBA is done before any project is undertaken. Turnbull is doing it the wrong way around, just as he long criticised Conroy for doing. The point to be remembered is that all this is politically driven. You cant expect any normal logical business processes to be followed, hence why the CBA is being done when it is too late to really matter. Had it been done when it should have been, and it took into account all the benefits, no one could seriously argue we would be even contemplating the patchwork solution Turnbull is peddling to the public now. A proper CBA would be valuable. The political one Turnbull is doing will not.
    CommonSense-e9dea
    • The purpose of the CBA

      I don't think the review will be that significant. I have a bad feeling the CBA is the important one. The excuse to not do anything, cancel the NBN, give it to Telstra, whatever, anything but build it.
      Pilfer-52cec
  • Scenario 6, is this the return of Ziggy's Solution 6?

    Wow all these "scenarios", the truth is all but the universal fibre to the home are a patch work quilt of inequality with the rich able to buy themselves out of the technological backwater.
    Building a broadband network with copper is absurd.
    Kevin Cobley
  • Scenario 6

    Abbott is obviously a role model for conservative Catholic Christianity. Less obvious however, he now follows a higher religion ‘the path to unregulated Capitalism’. The Australian Institute of Public Affairs (IPA) is his ‘Vatican’ and under the Clause: ‘We hope he (Abbott) grasps the opportunity to fundamentally reshape the political culture and stem the assault on individual liberty.’ have issued not 10 but 75 Commandments.
    No. 69 Reads: - "Immediately halt construction of the National Broadband Network and privatise any sections that have already been built".
    I believe this totally explains the reason for ‘Scenario 6 ‘.
    Bowen125