Abbott 'no Bill Gates' ... but is Turnbull?

Bill Gates still hasn't lived down his 1981 proclamation that 640KB of memory should be more than enough for anybody. Twenty-nine years later, Malcolm Turnbull seems set to repeat history, recently challenging NBN proponents to explain why anybody needs more than 12Mbps.

Bill Gates still hasn't lived down his 1981 proclamation that 640KB of memory should be more than enough for anybody. Twenty-nine years later, Malcolm Turnbull seems set to repeat history, recently challenging NBN proponents to explain why anybody needs more than 12Mbps.

"You tell me, what are the great productivity enhancing applications that cannot be accessed by 12Mbps broadband?" Turnbull asked, and quickly rebuffed suggestions that future growth would push through this ceiling. "The only thing that will drive high speeds for residential usage," he said, "... is going to be bigger and bigger files. And that can really only be higher and higher-definition video. You've then got to ask yourself, should the taxpayer be spending $43 billion when we know there are so many infrastructure demands where there is a screaming need now."


12Mbps should be enough for anybody: is Turnbull channelling an early Bill Gates? (Credit: David Braue/ZDNet Australia)

Arguments about one NBN speed versus another are always bound to fall short of the mark, because they are so ridiculously subjective: as I have previously pointed out, not everybody has the same requirements, and ruling out new usage models is a dangerous exercise in Gates-ism. Even focusing on specific speeds is a mistake: 100Mbps is a nice round figure to hang your hat on, but experience has shown that many Tasmanian customers are just happy to get the 25Mbps they've been promised with ADSL but cannot get. That's fine. But Turnbull is making a fatal flaw by characterising all potential NBN users as home users with a predictably low-tech set of requirements that only extends as far as HD video.

The fact is that over 35 per cent of Australian businesses are home-based (according to January 2010 ABS figures); 47 per cent employ one to four people, and 13 per cent employ more than four people. There is no geographic breakdown, but I think it's safe to assume that the majority of these home-based businesses would in fact be located in the suburbs, where broadband has long been notoriously hit-or-miss.

Now, imagine four people crammed into a home-based business, fighting for a broadband connection that might offer up to 12Mbps for downloads and struggling to complete phone calls and video-conferences with clients and suppliers using woeful 512Kbps-class upload speeds. At the same time, the kids are home in the other room, running streaming video and gaming that's conflicting with the business traffic. Suddenly, that theoretical 12Mbps maximum, which Turnbull argues is so far beyond conceivable usage models, doesn't look like anywhere near as much as it used to.

Businesses rely heavily on the internet: 74.8 per cent were using it in 2007 when the Australian Bureau of Statistics did its figures, and I'd wager that has increased dramatically in the past three years. All linked internet access with business productivity; the Victorian Government even backed figures that quantified this benefit at $5000 per year, per business. All would suffer under a plan that promised just 12Mbps, and in practice would deliver much less to the majority of the population.

Over 35 per cent of Australian businesses are home-based ... it's safe to assume that the majority of these home-based businesses would in fact be located in the suburbs, where broadband has long been notoriously hit-or-miss.

Heck, I don't live in or even near an official broadband blackspot and my ADSL2+ service was delivering just 2Mbps before the service gave out on me; not even the Coalition could improve this to 12Mbps without building a new exchange closer to my house. Is that really Turnbull's plan? Because if it is, I respectfully submit that he's dreaming: peppering the country with new copper-loop exchanges is hardly progressive telecoms policy. And if it's not his plan, he should explain how he's going to get me — and millions of others in similar situations — a competitive 12Mbps broadband offering without squashing us all onto wireless broadband where HD video wouldn't even dare to tread.

I have previously mentioned that I have a 100Mbps Optus connection that is faster than 12Mbps even if it is totally anti-competitive. Yet I am still struck with its remarkable sameness to non-accelerated options.

I may have up to 100Mbps downstream, but I rarely exceed 10Mbps and it still takes me 40 minutes to upload 10 minutes' worth of HD video, comprising 225MB of data. That's way, way slower than 100Mbps; an average upload speed of just 750Kbps, in fact. And that's on what is basically the fastest consumer internet connection available today; users on wireless, ADSL and cable will struggle to reach that figure.

From one perspective, Turnbull is correct: no one user currently really requires over 12Mbps downstream. But what he is not talking about is the upstream speed, or the massive logjam that would occur if two people in a house with a 12Mbps connection tried to use 12Mbps services at the same time. Or if someone in that house is watching HDTV over their new FetchTV service. Or if, heaven forbid, two people are watching different channels at the same time. Or if — as is the case in one third of all Australian households — the home is hosting a small business with real business requirements and expectations.

Back to Turnbull's 12Mbps challenge. It took me less than a minute to list a number of things businesses and home and home-business users can't do well with a 12Mbps/500Kbps connection:

  1. Telephony: small businesses hate conventional, expensive, inflexible PABXes. Hosted options from Telstra, Fonality and others give them the same features without the equipment. But they need lots of bandwidth in both directions, with little latency, and high reliability. ADSL2+ does not provide this.
  2. Hosted applications: software-as-a-service (SaaS) offerings have been popular among small businesses because the services give them access to high-end capabilities at a low, predictable price. But those services also require fast, reliable two-way bandwidth that ADSL2+ cannot provide. We already know Australian businesses are warming to SaaS and its broader-reaching cousin, cloud computing, but without adequate bandwidth in both directions they'll be skydiving through the clouds without a parachute.
  3. Remote learning and conferencing: communications is critical for small businesses, especially home-based businesses that rely on communications to make up for their decentralised location. For these companies, extensive customer outreach makes all the difference, and they complement this with online product presentations, online learning to gain new business skills and qualifications, face-to-face customer meetings, and more.
  4. Households with more than one computer: 12Mbps might be enough for one person, but if your household has teenage children, and millions do, you're not likely to be the only person online at any given time. Divided several ways, 12Mbps won't go anywhere near as far.
  5. Households with more than one TV: again, 12Mbps might be enough to keep up with one FetchTV or Foxtel IPTV stream, but once someone in another room decides to watch TV, you're going to have problems.
  6. Branch offices: branch offices are likely to be in strategic outer-suburb locations rather than fibred-up CBDs. They'll need access to the same hosted apps I mentioned earlier, but they also need a fat, effective pipe that lets them access company systems as if they were in the same building. With in-building networks running at 100Mbps both ways, a 12Mbps/512Kbps ADSL2+ or wireless connection becomes like pushing a watermelon through a garden hose.
  7. Remote backup: politicians may scoff, but businesses know that good backup is as important to business as customers are. But they've struggled getting data to and from their offices to central datacentres: anaemic wide area network (WAN) links couldn't cope, while physically moving backup tapes hundreds of kilometres for safe storage is clumsy, expensive and error-prone. Companies can sidestep this problem by backing up data to cloud-storage providers — or could, if they could get more than 500Kbps upstream. At that speed, a typical multi-gigabyte backup takes hours upon hours to complete. These services are also relevant to consumers, who are producing photos and home videos by the gigabyte but cannot effectively back them up.

There are more applications; feel free to share others you can think of below. But the gist is that bandwidth realities create problems for NBN opponents that show a chronic lack of imagination in their visions for the future. Turnbull is arguing for the status quo: woeful upload speeds that limit home and business users' participation in emerging online economies. And if you consider what he's actually saying, the huge disparity between his vision of adequate speeds and the realities of what's out there, threaten to make his speed argument as infamous an understatement as the one Bill Gates made 29 years ago.