NBN Co rakes in $356K in 2011

NBN Co brought in $356,000 in revenue in its first few months of charging for active services on the National Broadband Network (NBN), a new report has revealed.
Written by Josh Taylor, Contributor

NBN Co brought in $356,000 in revenue in its first few months of charging for active services on the National Broadband Network (NBN), a new report has revealed.

The figure came out in NBN Co's six-monthly report to the end of December 2011, published by the government yesterday. Since commencing billing retail service providers (RSPs) for the active services on the NBN in October, the company has raked in $356,000 in revenue in that time from the 2095 premises connected in the first release site, as well as the 110 premises in new developments and the 2197 premises connected to NBN Co's interim satellite service.

NBN Co said that as of 16 March 2012, there are now 7282 customers with active services over the NBN, with a total of 18,200 premises passed.As the company gets up and running and continues construction, it is still running at a massive loss. In the six months to 31 December 2011, NBN Co had a consolidated operating loss of $221 million, including $101 million in employee-related expenses, $40 million for IT and facilities expenses and $29 million for external services.

NBN Co had a total capital cost of $346 million for the six-month period, including $86 million for the fibre network roll-out and $12 million in costs for the fixed-wireless and satellite service. The company spent $124 million in that time on its datacentres, national support and operations centres and operations support systems and business support systems (OSS/BSS).

In November, NBN Co migrated all of its Oracle applications that had been previously hosted in an outsourced datacentre to NBN Co's own datacentre, ending a two-year IBM infrastructure managed service contract. The company also migrated its portals and online services, including NBN Co's website from the Macquarie Telecom datacentre to NBN Co's own datacentre in the same time period.

At the end of 2011, NBN Co was sitting on $1.14 billion in cash from government equity injections, and had accrued $29.3 million in interest.

NBN Co's contact centre, which was set up in Melbourne in April last year to "dispel" confusion from the public surrounding the roll-out of the Federal Government's $35.9 billion project, had taken a total of 12,692 calls in the six months to 31 December 2011. Of these, NBN Co said just 81 were complaints about the roll-out.

The company has today announced that it plans to bring the contact centre in-house, with a new contact centre to be located in Varsity Lakes on the Gold Coast in Queensland. NBN Co said that this new contact centre will be up and running later this year, and is expected to employ around 130 people.

Turnbull eyes greenfields delays

In a blog post responding to the report, Shadow Communications Minister Malcolm Turnbull focused on the revelation that just 110 customers had active services in greenfields sites. A total of 951 sites have been connected, which Turnbull said was just 0.3 per cent of the houses that NBN Co was scheduled to connect by June 2011.

"The latest NBN progress report ... underscores that NBN Co has again utterly failed to keep up with demand for connections in new or 'greenfields' areas," Turnbull said.

He said that the government's decision to make NBN Co the fibre provider of last resort for new housing estates with over 100 premises had "upended" the fibre provider industry, which couldn't compete with the free service that NBN Co was offering developers, and that this had led to lengthy delays for new houses to get connected to the NBN.

"Before Senator Conroy upended the sector, greenfields communications infrastructure in Australia was a thriving market served by numerous competitive and efficient private players. Even his department has acknowledged as much," Turnbull said.

"But Senator Conroy's ill-considered decision to assign exclusive responsibility for rolling out infrastructure at greenfields sites with more than 100 lots to his taxpayer-funded, government-operated monopoly has led to lengthy delays for developers, and immense frustration for owners moving into new residences."

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