One year on: NBN Co reports tiny spend

One year on: NBN Co reports tiny spend

Summary: In it's first full year of operation, the National Broadband Network has spent less than one per cent of the government's total expected investment of $26 billion into the network.


In its first full year of operation, the NBN Co has spent less than 1 per cent of the government's total expected investment of $26 billion into the National Broadband Network (NBN).

In NBN Co's annual report, released on Friday, the company revealed that it had spent approximately $83.7 million for the year to 30 June 2010. Of the total amount, $38 million went to employee wages and $39.9 million went to external systems, legal costs and IT.

The company did not record any revenues from the network: the first Tasmanian towns had not yet gone live at June 2010. In any case, initial revenues might not be high in next year's annual report, as the government has been giving providers special rates to entice them to become involved with the network. Last week it was also revealed that since the roll-out began in Tasmania, just 436 premises have signed up for services on the NBN.

Since the end of the last financial year, the company had received a $350 million equity injection from the Federal Government in July and another $350 million injection will be put into the company next month. $100 million of this funding went to NBN Co subsidiary NBN Tasmania Limited. NBN Co said the timing and amount of further funding from the Federal Government will be determined once the government has formally responded to the McKinsey KPMG implementation study and when the company's heads of agreement with Telstra has been finalised.

The NBN Co had released an annual report prior to this one for the period from 9 April 2009 to 30 June 2009. At that point, the company had spent $139,000, all on external providers.

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

Suzanne Tindal

About Suzanne Tindal

Suzanne Tindal cut her teeth at as the site's telecommunications reporter, a role that saw her break some of the biggest stories associated with the National Broadband Network process. She then turned her attention to all matters in government and corporate ICT circles. Now she's taking on the whole gamut as news editor for the site.


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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  • CNN money – 1/11 - Fed decision:

    "Investors will be pouring over the Federal Open Market Committee's meeting announcement, released Wednesday. The Fed is widely expected to launch another round of monetary stimulus in an effort to boost the (US) economy…"

    …"People are wondering, 'is it going to be $500 billion? $1 trillion? $2 trillion?...{END}

    $500B = over 11 complete Australia wide NBNs & $2t is over 46 complete NBNs and this is the US' stimulus package! Plus this follows on from their previous (I believe) $787b (18 complete NBNs) stimulus package.

    And some have the audacity and short-sightedness, to criticise as waste and mismanagement, Australia's commitment to spending $43b over 8 years, of which only $26b is claimed to be of taxpayer fix Australia’s ailing comms for around the next 50 years?
  • 1% of budget to connect like ~0.11..% of premises in Australia, hmmm
  • RS, i read that the NBN has spent (incurred or about to incur) $800m to achieve 432 users to date. Up to June 2010 they couldnt spend the tax payers dollars because the NBN had more political value in being a promise and vision for the suckers than ever being actually done or revealed. (as we see now when as is revealed , a pathetic string up, a dodgy fragile monopolistic 19th century vision of the overland telegraph into every home with a NTU citizen control inspection point).
    With an already obselete design and set of gear behind it and 25,000 maintenance and support crew splicing and patching the mess. Mandated, then forced and then any other choice removed by law. 20 million batteries sucking the grid and poisoning the environment. All voice and data is digital, and property of the Minister.
    So using your maths RS, the NBN has burnt thru $800 million (3% of 26b ' estimate - but has only connected 436 users (0.00002%) of the estimated users. Of which half already have said they have no intention to continue if they had to pay for it.
    So in say 0.00001%. Thats just about zero proof for nearer to a billion wasted so far.
    So now lets go and do that at the rate of 3,400 per day ( promise of 93% coverage of nearly 20 million connection points is achieved) for the next 15 years.
    If they had spent more, and done a proper auditable trial and a decent size city or even town, and had a plan, the NBN would have some creditability. They cant.
    The Japanese guy came out and said the whole thing was wrong and could be done for under 4b with what we have and better. $15 a month top speed and data.
    Mr. USA NBN also came out also and said its wrong design and a disgraceful waste.
    I read Telstra want another $5b as well, thats because RS you arent ever going to see fibre go out to everyone, wait for the big NBN 'switcheroo' and everything the NBN has been denying will then become "oh new technology on existing infrastructure allows us to do this and that.." Yep after billions wasted going done dead ends and political spin and vote buying.
    Everyone can see the NBN is just a political stunt and can never execute.
    All we read is fat wages, wastage, no one wants it and it can be done better for a fraction of the cost. There were more constructive ways to provide better communications in Australia than this mess and wastage.
    Shut it down, have the Royal Commission, take advice from world experiences including why similiar NBN's have failed across the world ~ and get professionals in.
    NBN failure from the gun
  • The the good thing about the NBN is clientele can utilise it “as it is being built”. As opposed to other builds, imagine using the Sydney Harbour Bridge, when it’s partially (pun intended) done? The word splash comes to mind.

    But not with the NBN… sure big injections of funds will be required at times, but isn’t that the same with any large infrastructure build.

    Surely that’s obvious, commonsense?
  • Maintaining an old copper network is expensive, Son says. Copper networks more than 20 years old should be “taken away” and “100% replaced” with a new fibre network.

    So, in fact he gave a glowing endorsement of the NBN but somehow the media selected out of context quotes to make it appear that he said the opposite.
  • "RS, i read that the NBN has spent (incurred or about to incur) $800m to achieve 432 users to date"

    So clearly what you heard along with probably everything else you have heard from the same source was a blatant lie.

    The annual report is a legal document and the directors of the company face imprisonment if it is wrong. It shows that the entire spend for the company for the year was $83.7 million.
  • You're not comparing apples to apples here. Their economy is bigger, their population is bigger and their economy is tanking. What they spend to prop up their ailing economy is irrelevant as an argument for or against what we are spending on the NBN.
  • The point has nothing to do with size or economies, it has to do with those like you calling a $43B ($26B government money) to upgrade Australia's comms a waste when the Americans will throw $t's just for their economy to be equal to ours!
  • boring! boring! boring! the question is why so many dull people
    Blank Look
  • Mate, the government have said it will only cost taxpayers 26B but until contracts are signed, that's just blind optimism. This government have already shown that they cant manage costs on large scale pronects. I haven't seen anyone rushing in to invest in this yet. When it comes to spending taxpayers dollars (or borrowings in this case) I think we should all be a little less trusting and demand more transparency and consultation.
  • No maaate...McKinsey/KPMG said it would cost $26B, following their study!

    So that forecast is either accurate or it isn't, but it's more than you have!

    As such, you can continue to baselessly call me blindly optimistic (and although you have nothing now, history may even prove I was) all you like!

    ...And I will continue to (with some current basis to support me) call you FUDster... agreed?
  • Lol agreed ;), but I'm basing my assumptions on history. Show me a large scale government IT program that was delivered on time and on budget.
  • Yes granted, government projects do tend to waffle somewhat regardless of which political side is in power...that's politics and politicians for you!

    But most government programs don't have an opposition with such an aggressive, attack dog, criticise at all costs mentality, breathing down their necks as this government does, on this particular issue!

    Which I guess (as a swinging voter) is a good thing, within reason, to keep it all on track, so...!

    It's good too, that unlike some of your like minded posters, we can have a laugh, agree to disagree and just see what occurs into the future...rather than not giving one another any credence what-so-ever, LOL!!!
  • My what a thought provoking, intelligent and *visionary* comment, not.