MEDIA RELEASE - THE LONG TERM ECONOMICS OF TURNBULL’S NBN ARE A MESS - 7 FEBRUARY 2018

Amidst rising consumer dissatisfaction about Malcolm Turnbull’s second-rate NBN, a survey by Venture Insights, that was co-funded by the ACCC, has reported 30 per cent of households could abandon the NBN and switch to wireless.

This study comes as the 2018 NBN Corporate Plan clings to the assumption that only 15 per cent of users on Turnbull’s multi-technology mix will use wireless instead of the NBN between now and 2040.

This is despite a 15 per cent substitution rate right now, with a second-rate network that will become increasingly exposed to competition over the next five years.

It has long been understood that transformational wireless 5G services are emerging, with fibre continuing to preserve the indefinite performance and reliability edge that is needed to compete.

The tragedy is Turnbull has built an inferior NBN that is exposing taxpayers to risks he has spent over four years trying to deny:

  • The cost of the multi-technology mix has increased from $29.5 billion to $49 billion
  • It is more exposed to wireless competition
  • It costs more to maintain over its lifetime
  • It delivers slower speeds
  • It delivers a less reliable service
  • Consumer complaints have hit record highs
  • It will require expensive and wasteful upgrades that could have been avoided
  • It generates less revenue from those willing to pay for higher speeds - but the network can’t deliver

Further, NBN executives have confirmed the 30 year business case does not set aside any funding for upgrading the copper network:

Senator O'NEILL: Could you confirm for me whether the ongoing capital expenditure that you have just said is set aside in your forward projections is for a wide scale upgrade of the 5.4 million premises that are on the FTTN network?

Mr Morrow: I can assure you it is not. It is for miscellaneous things. If a cabinet gets hit by a car, we have to go out and put a new cabinet in.

This is not a multi-technology mix – it’s a mess.

A coherent vision for economic growth requires a long-term plan for the enabling infrastructure that will help Australia be more globally competitive.

Now there are even more question marks about whether Turnbull’s second-rate NBN will even pass the test of being domestically competitive.