Vic govt pans NBN three-year roll-out

Vic govt pans NBN three-year roll-out

Summary: Victoria's Coalition government has taken the Federal Government to task over the newly released three-year deployment plan for the National Broadband Network (NBN), with ICT Minister Gordon Rich-Phillips claiming that Victoria will receive a disproportionately small number of connected premises compared to other states.

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Victoria's Coalition government has taken the Federal Government to task over the newly released three-year deployment plan for the National Broadband Network (NBN), with ICT Minister Gordon Rich-Phillips claiming that Victoria will receive a disproportionately small number of connected premises compared to other states.

Prime Minister Julia Gillard, Federal Communications Minister Stephen Conroy and NBN Co CEO Mike Quigley yesterday announced where the high-speed fibre network would roll out over the next three years. The trio said that by 2015, New South Wales could expect to see 1.01 million premises connected, followed by Victoria at an expected 691,600, Queensland with 678,600, Western Australia with 429,200, South Australia with 327,300, ACT with 135,300, the Northern Territory with 65,200 and Tasmania with 209,100 — a projected 3.5 million premises in total.

Rich-Phillips has criticised the Federal Government and NBN Co for prioritising New South Wales over Victoria, saying in a statement late yesterday that Victoria plays host to a quarter of the country's population, yet received less than 20 per cent of the proposed three-year roll-out plan. Rich-Phillips went as far as accusing the Federal government of Labor favouritism.

"Although there has been a slight increase to Victoria, the roll-out still clearly favours the Labor-held states of South Australia, Tasmania and ACT," he said in a statement.

"Although South Australia has just 7.3 per cent of national population, it is receiving 9.2 per cent of the funding. Tasmania, which represents just 2.3 per cent of population is receiving 5.9 per cent of the program funding. The Gillard Government is quite clearly funnelling money into these states to prop up struggling Labor administrations," the minister added.

Quigley and Conroy made a specific note at yesterday's press conference to address potential favouritism accusations, with Conroy at one point joking that "[Coalition MP] Paul Fletcher can put his press release away". The three-year roll-out plan will see 67 of 72 Labor seats, 61 of 71 Coalition seats and six of seven independent seats connected to the fibre network.

Quigley added that the roll-out plan had been determined based on a number of factors, including the prioritisation of "growth corridors" that would see greenfields sites completed quickly, load balancing in local communities and ensuring that Australia's major universities were included.

These assurances didn't stop Rich-Phillips' complaints, however, as the Victorian ICT minister accused the government of breaking a promise to deliver the NBN to "Victoria's population share".

"With only 19.5 per cent of the premises in the total plan allocated to Victoria, our share of NBN construction activity is still too low given we represent a quarter of the national population. I am disappointed NBN Co's three-year roll-out plan fails to deliver on this commitment," he said, adding that to adequately service Victoria, NBN Co's three-year roll-out would have to reach an additional 191,000 premises, bringing the total number up to 882,600 connected premises by 2015.

Rich-Phillips said he will campaign to make sure Victoria got its fair share.

"Major regional centres such as Mildura, Warrnambool, Wangaratta and Bairnsdale have been overlooked as have many smaller communities with inadequate services. The Coalition Government will continue to advocate for a better and fairer share of the NBN infrastructure for Victoria," he said.

Since it was elected in a landslide victory, the Victorian Coalition government has always sought to squeeze as much as it can out of the federal communications administration. At one stage, Premier Ted Baillieu told ZDNet Australia that Victoria wouldn't support the NBN until the Federal Government worked with the nation's telcos to improve regional mobile phone coverage for all Victorians. Rich-Phillips re-asserted the party's position in February 2011, saying that the responsibility of providing strong mobile coverage fell on the shoulders of the Federal Government.

"The Commonwealth Government has primary responsibility for ensuring there is adequate mobile phone coverage across Australia. Mobile phone coverage during emergency situations is of particular concern to the government," Rich-Phillips said at the time, while expressing concerns about the sheer cost of the NBN.

"We are concerned that broadband users and taxpayers may pay too much for the Commonwealth's National Broadband Network. We want to ensure the NBN does not undermine competition in the broadband market, particularly around enabling new technologies and new telecommunications providers competing on merit," he told ZDNet Australia.

Since then, NBN Co has made considerable investments in the state of Victoria, including building its National Operations Centre in the state and awarding over $1 billion in contracts to local companies.

Josh Taylor also contributed to this report.

Topics: Government, Broadband, Government AU, NBN

Luke Hopewell

About Luke Hopewell

A fresh recruit onto the tech journalism battlefield, Luke Hopewell is eager to see some action. After a tour of duty in the belly of the Telstra beast, he is keen to report big stories on the enterprise beat. Drawing on past experience in radio, print and magazine, he plans to ask all the tough questions you want answered.

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49 comments
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  • As per the last paragraph, Melbourne houses the NBN headquarters generating lots of jobs along with it and gets contracts awarded to local companies to build various pieces of equipment and yet all we here from Victorian government is a whole bunch of whinging. Give it a rest.
    nomadtales
  • The Victorian government were going to complain regardless. Quite frankly they are morons. I bet they didn't even bother to look at the roll-out map. But that is the beauty and nature of this NBN rollout, if bigger towns/cities get it complain for the smaller neglected towns and if smaller towns get it complain for the bigger towns/cities with larger populations that wont get it.
    Hubert Cumberdale
  • The very existence of the Gillard Government relies entirely on the whim of Tony Windsor
    and Rob Oakeshot NSW Federal independent MPs hence the NBN payola.
    Vasso Massonic
    • If we're assigning causality like that, then why not say that the very existence of the Gillard Government relies entirely on the head of Tony Abbott - if he hadn't been so pig-headed in negotiations, they might have made him PM. Or, if things were different, Malcolm Turnbull. As it was, Abbott made it impossible for Windsor and Oakeshott to support him.
      Gwyntaglaw
    • Indeed Vasso thinks Julia is bad... Tony W and Rob O obviously believe Tony's worse.

      In relation to payola, if you remember back it was Abbott doing the payola offering $1B for a Tassie hospital, which backfired because Wilkie thought that was... well...blatant payola...LOL

      Funny how some insist on changing history to suit their p & p's (politics and portfolios).
      Beta-9f71a
  • "This food is terrible!" "Yes, and in such small portions!"

    If the Government wanted to exhibit Labor favouritism, then they WOULD have given Victoria a greater share, because their vote in 2010 was stronger there than any other major state.

    Seeing favouritism in a technical process like this is like seeing horses and dragons in a sky full of clouds - or seeing messages from aliens or the Virgin Mary in pieces of toast. If you really, really try hard, you'll see what you want to.
    Gwyntaglaw
    • It's not Labor favouritism, Windsor and Oakeshott insisted on starting the deployment from the outer regions, regardless of cost to taxpayers. Abbott always said that spending between $37 to $50 billion on the FTTH was lunacy.

      It remains to be seen who was right down the track.
      Vasso Massonic
      • Helloooo,

        Once again VasMas the NBN is NOT being funded by general taxation revenue and is projected to repay itself and then be a profitable asset for, guess who?

        http://www.smh.com.au/business/government-goes-global-to-raise-3b-needed-for-national-network-20110710-1h91o.html

        Oh that's right, as a long serving, hurting Telstra (and CFU) shareholder, perhaps profitability on investment is something foreign? ;-)

        Funny how some insist on changing the present to suit their p & p's (politics and portfolios).
        Beta-9f71a
        • Beta, my understanding is that the Australian people will be injecting some $27B equity into NBN Co.
          Knowledge Expert
          • Yes indeed good point, it's only $27B/$2.7B p.a over 10 years not $36B/$3.6B pa over 10 years. Nicely spotted.

            And coming from the sale of bonds, securities, BAF, contingency fund, NOT general taxation... although granted that is always an option, to the current government (or another government of the opposite political persuasion, should they awaken up from their stupor).

            And of course the projections show that from $27B to $36B, the NBN will be self-funded from revenue, leading to full repayment in 2034 and profit from there forward having become a valuable asset to sell.

            This is opposed to your heroes MT and TA, blowing $17B on their FTTN shemozzle, gifting both the network and many $B's to their mate in the private sector, especially Telstra.

            So, do you think $27B sourced from investors, which will pay for itself, then become profitable and a valuable asset worth $b's is wasteful, while giving away $17B to private companies to build and own OUR network isn't?

            Well?
            Beta-9f71a
          • @ Doubt

            Since you haven't replied and curiously you normally (no matter how immaturely and ridiculously) love to reply, I'll ask again...

            Do you think $27B sourced from investors, which will pay for itself, then become profitable and a valuable asset worth $b's is wasteful, while giving away $17B to private companies to build and own OUR network isn't?

            Clock is ticking tiger!
            Beta-9f71a
          • Beta, my understanding is that NBN Co is a GEB. Mr Quigley mentioned the other day that the government would provide $27B equity into NBN Co. I do not know where that money is being sourced. The government doesn't show any expenditure for NBN Co in the budget. In any event it is reasonable to expect the money to be borrowed. Thus interest would be payable. But not by NBN Co, the government would, I expect be liable for interest payments.
            The point I am making is that it is difficult to form an opinion of the financial outlook of the overall NBN given the complexity of the arrangements.

            Another aspect to consider is the effective management of NBN Co over time. I don't expect Mr Quigley would remain in the company for an extended period. He is the start up leader and could be expected to move on at some point.
            Looking back at Telecom Australia, that was an inefficient organization with large staff numbers. Many complaints about it's service, prices just increased, never decreased, poor customer focus.
            The performance of Telcom Australia was the genesis of demands for competition in the 1980's.
            I think many people are concerned NBN Co will emulate Telecom Australia's performance.
            Knowledge Expert
          • Yes, now which is most wasteful?
            Beta-9f71a
          • "I think many people are concerned NBN Co will emulate Telecom Australia's performance."

            If they think that, then they haven't thought it through very well. Telecom, formed from the old Post Master General, was a government department in form and function; in all but name, really. It was an absolute monopoly, vertically integrated from infrastructure through to retail, and a law unto itself. Oversight, accountability and scrutiny was pretty minimal for much of its life, and there was no economic basis to many of its decisions.

            NBN Co has no consumer retail presence. It is a wholesale provider only - most people will never contact them at all. It will not have to provide everyday customer service at all, except to its corporate customers, the several dozen RSPs that offer for retail an NBN service.

            NBN Co is therefore a very lean operation - run by engineers and technicians, not by bureaucrats. There are no legacy systems and practices weighing down its operational activities. Once the construction phase is over, the focus will be on smooth maintenance of services and keeping the network humming along. And at that point, the plan is to sell it off - under a regulatory regime which guarantees service standards and pricing controls. Though it will make very little difference to its internal operations whether it is private or public at that stage.

            You are doubtless correct that Mike Quigley will not remain with the company for the long haul. His focus is getting all the moving pieces in play during the startup and planning stages. Assuming that NBN Co is not radically reshaped and truncated by an incoming Coalition Government, he will probably leave once the hard work is done and hand off the reins to someone else to run to completion. Which is fair enough.
            Gwyntaglaw
          • Gwyntaglaw,
            I wish I could share your optimism on the effective efficient management of NBN Co.
            A few points you raise do concern me.
            1. Engineers & technicians in charge of an organisation do not automatically translate to a well run business. You do need boring people like professional managers, accountants.
            2. For a business to run most efficently competition is acknowledged by most to be an effective means keeping operational expenses in check and prices as low as possible. NBN Co will be a guaranteed monoploy wholesaler. That is a concern.
            Knowledge Expert
          • LOL... we (well you) have now done the complete circle and arrived back at big bad monopoly.

            The FUD trains rattles on!
            Beta-9f71a
          • Beta, I think it is a concern to have a monopoly wholesaler. I can foresee a clause in the contracts with the retailer , which allows increases in line with inflation.
            Knowledge Expert
          • What's the alternative?

            Many cables in each home...LOL!
            Beta-9f71a
          • Beta, I do not understand what you mean. with your reference to "many cables"?
            Knowledge Expert
          • No you don't understand, situation normal ;-)
            Beta-9f71a