NBN broadband prices will drop: Quigley

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.

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TOPICS: NBN, Broadband
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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Conroy has previously argued that the reason the case could not be published before December was because parts of the document would have to be blanked out due to commercial confidentiality reasons, however Shadow Treasurer Joe Hockey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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64 comments
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  • Something more specific would be nice, what 'over time' timeline are we talking about here, 5 years, 10 years 20 years more? and broadband prices will fall from what level to what other level exactly?

    How does the CEO of the Government FTTH wholesaler know that ISP's will charge less at the retail level 'over time' and at the same time make sure their corporate investors are kept happy and their business case remains viable?
    advocate-d95d7
  • Quigley - ..."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"{END}

    Your words, NBN will NEVER pay itself off, are ringing in ones ears advocate!
    RS-ef540
  • I think the proposed private briefing to selected senators is outragous. These cross bench and independants have such a small proportion of the total vote. This means those senators who are representing large numbers of the voting population are left out in the cold. NBN Co should not politicize themselves in this way.
    Blank Look
  • If the governments wholesale approach is going to lower prices, why are water, power and gas bills skyrocketing. They follow a similar distribution model.

    The NBN will have many benefits but lower prices will not be one of them.
    mwil19-a34f7
  • We also don't know if it's going to be $11 billion for Telstra or not and what the figure for Optus will be, as we have no idea of the final contacted figures predictions are navel gazing.

    The NBN will never pay itself off, the Tasmanian pilot won't even pay itself off, not many wanting it doesn't help that one - oh dear!, we had better move choices of fixed line BB away from the punters, that should fix it - but please don't mention wireless.
    advocate-d95d7
  • That's bit rich mwil19, using historical precedence to establish a fact, the NBN infrastructure is different because err umm it just will be, trust me, I am a Government Department promoting a political product.

    :)
    advocate-d95d7
  • I currently pay just over $100 a month for my 1.5mbps ADSL line. I am also on a conjested rim, so I hardly ever get download speeds of over 30kb/s. When the NBN rolls into my neighbourhood, I'll definately be signing up the minute I am able to and so will several of my neighbours that I know of.

    A large proportion of the anti-NBN crew already have access to ADSL2+ or Cable, which is great for them, but they are too narrow minded to see that there are more people in the country besides them who might want access to broadband for the first time.
    Ausfailiasinternet
  • Perhaps prices increase because water, power and gas are finite resources? Meanwhile internat access prices have been falling so that roadside posters and notices on the backs of buses are not keeping up with the current deals.
    Listohan
  • So even you guys still not believing Quigley?

    Then there is no more hope for you, or Australia.
    Nitrofiet
  • Exactly why "we" need an NBN Ausfailiasinternet...

    Sadly these above already have ADSL2+ or cable and also appear to have a personal and political agenda to STOP YOU from receiveing decent comms.

    Great guys eh?

    Frankly these people, couldn't care less, if you had a phone in an emergency or not, let alone access to 21st century broadband, because "they're doin' fine"!

    I already enjoy ADSL2+ too, but can clearly see the benefits of the NBN for those without. As such, I believe the NBN is value. Which is why I support it and recognise that first N, in NBN is most important.
    RS-ef540
  • Comparing the NBN to electronic consumer good prices? That's IS a bit rich. The unions are already lining up massive pay increases for workers on this project which will negate any economies of scale as the project rolls out. Watch inflation spike in the next couple of years, then get back to me about affordable internet for the masses.

    And yes RS, I am pessimistic about any publicly funded project that won't give details to the people paying for it.
    mwil19-a34f7
  • But you see I have Optus Cable, costs about $60.00pm and download speeds range up to 9Mb/sec (often), just is standard broadband not the fast running antelope type. So I'm alright mate! (ins't that the Australian way)
    Blank Look
  • Comparing technology to technology... not technology to water or oranges

    Gee wouldn't want "the mere blue collar worker (no I'm not one, bvut I can recognise their plight)" to earn enough to actually live now would we... Fancy letting them feed the family!
    RS-ef540
  • WTF are you talking about? My issue is that this distribution model HAS SEEN THE COST OF LIVING RISE for blue collar" workers in Australia. Inflation will eat away any wage increases they get and If you don't belive me, read some economic history. Last time Labor spent this big did the cost of living for workers go down? No. Did their standard of living go up? No.

    When inflation eats away at the ability for struggling Australians to clothe and feed their families, do you think they'll give a rat's about high speed internet?

    RS, I take personal offence to you implicating that because I care about the economy, and look past the financials of next week, that I'm somehow selfish. I thought the Young Labor movement would teach you how to argue a little more effectivly.
    mwil19-a34f7
  • No worries comrade!
    mwil19-a34f7
  • So how much are NBN plans going to fall over what time period RS?

    Best let that one go through to the keeper, the strategy is to keep spinning like a top about generalities and rubbish such as the word National in NBN, and there must be a old Snowy Mountains Scheme brochure that can be pulled out of the hat around here somewhere.

    What ever you do don't mention actual dollar figures of NBN retail plans or actual time frames of when they are going to 'fall over time'.
    advocate-d95d7
  • these monkeys are still paying out the NBN...?, must be Liberal Blog Bots on crack or something.... lol
    jetair


  • You know it has always been said in online debates the first one to mention Nazi is conceding defeat. I think stupidly mentioning comrade, when beaten in a debate, is close enough...LOL!

    You have been found out for what you are. You aren't anti-NBN for nothing eh? It's all politics for you...

    If you really were concerned about the economy you would have read the OECD doc. where the economy was given a glowing report...not honed in on Turnbull's negative BS...

    So now we know your motives mwil19... which one of your FUDster mates is next -
    RS-ef540
  • Wow! 9Mb/sec upload capacity on Optus Cable for $60.00pm where do I sign up!?!? oh wait you meant 9Mb/sec download and oh wait Optus Cable isn't available in regional cities like mine, guess we could come up with a FTTH NBN plan that would solve these problems oh wait the current government is trying to do that right now. wow they must have read my mind.
    Hubert Cumberdale
  • no the politicians ( spit) will sell it off to the Singaporians or someone else from teh UK or USA who will make money from it by raising prices.
    Politcians ( spit) dont think of anything but their little world.
    These same politicians ( spit) told us all will be well when they 1. de regulate the banking sector 2. sell off the state owned electricty companies 3. sell of the government owned telecommunications company Telecom/Telstra.
    Not one wit of common good do i see them create other than to remain fully snouted in their superannuation trough.
    Hideous62