NBN business case unveiled

Details from the business case for the National Broadband Network have filtered out as the National Broadband Network Company finally released the document.

The document (PDF) was released to journalists in a media lock-up at 10:30am today with NBN Co CEO Mike Quigley but was made available following a press conference held by Conroy at midday.

According to the NBN Co press release put out just prior to the public release of the document itself, the business case says that:

• The cost to taxpayers will be $27.5 billion. Total capital expenditure to the end of the construction period is expected to be $35.9 billion. Over the same period, total operational expenditure net of revenue will be $1.0 billion. Funds will be sought from capital markets from financial year 2015. The amount of debt to be raised from project finance or financial markets is expected to be $13.4 billion.
• Annual revenue forecast at $5.8 billion in financial year 2021, $7.6 billion in financial year 2025, with the network expected to have positive operational earnings forecast from financial year 2018 and positive net income in financial year 2021.
• The NBN will take 9.5 years to reach 10 million homes.
• There will be 120 points of interconnect for the network
• A basic wholesale access price will be $24 per month for a 12Mbps connection.
• NBN Co has made the assumption that 70 per cent of premises which are passed by the network will take up a broadband service.

The government has sat on the document since receiving it from NBN Co last month. Conroy previously stated that decisions around NBN points of interconnect would have to be decided before its release and said that some of the document would be censored due to commercial sensitivity around tenders for the project and deals made with telco companies like Telstra and Optus.

Independent Senator Nick Xenophon last month secured the release of a summary of the business case in negotiations to secure his vote on the telecommunications reform legislation that will pave the way for the NBN.

For Twisted Wire this week, Phil Dobbie will be looking at the NBN Corporate Plan released today. Do you have any thoughts you'd like to share? If so, call 02 8006 1257 anytime between now and lunchtime tomorrow (Tuesday, 21 December), leave your name and record your message. It'll be included in this week's podcast, which is coming out a day early (on Wednesday).