Special Feature
Part of a ZDNet Special Feature: Next Generation Networks

Asbestos, contractor fiascos prove NBN's worst enemy lies within

Forget fibre to the premises vs. fibre to the node; the growing range of problems with Australia's National Broadband Network (NBN) confirms the biggest battle awaiting the presumptive Coalition government will be bringing contractors in line.

The knee-jerk politicisation and media-fuelled overreaction to Telstra's asbestos problems over the past week — which went from the sublime to the ridiculous as Malcolm Turnbull attempted to pin the blame on his political rivals rather than the Coalition — are perhaps most noteworthy for the many questions they raise about the National Broadband Network's (NBN) future viability, no matter what party wins the September 14 Australian election.

Telstra's recently imposed stop-work will make it all but impossible for NBN Co to meet even the severely reduced June targets it released in March, which looked achievable for a few days there. Instead, the Coalition will inherit a project riddled with all the problems that it has been wishing into existence for the past three years — and it's going to take a bipartisan approach, backed with a big stick, to fix them.

House stumps eaten by termites: CC BY-SA 3.0 by Lady Alys (http://en.wikipedia.org/wiki/File:House_stumps_eaten_by_termites.jpg)
Like termites attacking house stumps, project-management rot is testing the foundations of the NBN. Image: CC BY-SA 3.0, Lady Alys

As has become clear with the utter failure of Syntheo in the Northern Territory, the ongoing problems scoping and executing on NBN Co's LTE network, and now the revelations that Telstra-managed subcontractors are apparently routinely ignoring basic health and safety regulations, the biggest problem with Labor's NBN is not that Labor is building it, or that it's built around fibre to the premises (FttP) versus fibre to the node (FttN).

The NBN's biggest problem is that it is being entrusted to an opportunistic private sector that simply does not care whether it's actually built or not.

Labor talks, correctly, of the NBN as everyone-do-their-part nation building, but the private sector seems to be treating it as just another opportunity to dip into the government's cash-lined pockets, with minimal protections and proper performance only when prodded. I'm reminded of Pink Floyd's song Have a Cigar: "Come in here dear boy, have a cigar/You're gonna go far ... And did we tell you the name of the game, boy?/We call it riding the gravy train."

Sure, the company has taken a swift and appropriate response — but if you consider that one of CEO David Thodey's first actions was to reassure shareholders that any asbestos-related liabilities would not be material (despite calls for it to set up an asbestos compensation fund ), it's obvious where the company's priorities lie.

Indeed, every time there's an NBN hiccup, Thodey's first instinct is to reassure shareholders that everything is fine. Never mind that the company is already paying millions for asbestos compensation. His optimistic and repeated denials are beginning to sound more and more like Malcolm Turnbull's strangely confident NBN optimism.

The NBN's biggest problem is that it is being entrusted to an opportunistic private sector that simply does not care whether it's actually built or not.

The fact remains that even the Coalition's alternative plan will need to be built by the likes of Syntheo, which committed to rolling out the NBN across the Northern Territory without apparently checking its payroll to see if it actually had anybody to do the work. Oops. Secure the money first, then worry about the details later.

Then there's the growing tide of discontent around suggestions that NBN Co subcontractors are gouging the company by stockpiling profits while they pay below-market rates, which became necessary when they submitted unrealistically low bids to secure work they simply lack the resources to complete.

Unions are right to be questioning these contractors' priorities — and this all should have been dealt with long ago. For all of its good underlying intentions, the NBN has come off like a theatre production, where actors are reading their lines for the first time backstage, even as the audience members are already finding their seats.

Indeed, there is madness in Labor's NBN method, and comparisons with Labor's "pink batts" initiative are apt. Once again, the government has committed money in good faith, and been let down by contractors who care so little about doing good work that they apparently failed to implement even basic training or worker protections.

There is madness in Labor's NBN method, and comparisons with Labor's 'pink batts' initiative are apt. Once again, the government has committed money in good faith and been let down by contractors who failed to implement even basic training or worker protections.

This isn't how you build a nation; it's how you bankrupt one, both financially and spiritually. And that's why, when issues such as the presence of asbestos are diverted into political stoushes, and the name of Bernie Banton is flung around parliament like string beans in a school-cafeteria food fight, observers of the NBN effort can't help but feel twinges of remorse that what should be a bipartisan effort has all been this difficult and, as we near a game-changing election, unfruitful.

When the Coalition takes power, it's going to have to make a commitment to move away from its mind-numbing negativity about Labor, and to take a more productive tack that includes extracting real and predictable outcomes from the contractors in the market.

After all, Turnbull's plan also relies on the same regional LTE wireless that is now causing problems for Labor. Building the network to budget limitations will require Turnbull to wield the whip hand on trough-swilling civil contractors, while tighter constraints on NBN Co will force it to get the same contractors to complete a substantially different project on the smell of an oily rag.

Strong-arming the private sector has never been a core strength for the political right, but that may be what it's going to take to get this broadband upgrade done one way or another. Forget FttP vs FttN: If this government, or the next, can't get the industry to take the NBN seriously, not even our grandchildren will see its benefits.

What do you think? Are these contractor dramas really Labor's fault? Or will the Coalition government need to learn how to get tough on big business to deliver its promised outcomes?