[LINK] NBN - could Conroy have done it differently?

[Richard Chirgwin]

Linkers,

Actually here I'm just putting some thoughts down before I lose them 
entirely! But Robin's post got me thinking again ...

Without being seen as an apologist for Conroy, the issues with 
construction contracts probably illustrate one reason why he seemed to 
slap the thing together and pluck the $43 billion number out of the air. 
Here's two scenarios:

1. Get researchers in the Department to seek out some kind of benchmark 
of construction costs and assemble an internal model.
2. Go to market for estimates of cost.

In case (1), there will inevitably be shortcomings and errors in the 
model - not because the Department lacks skills, but because all models 
break when the real world is introduced.

But what would have happened in case (2)?

2a. The proposal would have leaked, which would have been a political 
disaster in 2007.
2b. The industry would either underestimate the cost (on the assumption 
that cost blowouts can always be justified later), or it would go into a 
feeding frenzy, blow out the cost estimates, and kill the project.

It appears to me that as in creating the political project (not the 
"actual" project), the government decided that the constraints of (1) 
were still preferable to the risks of (2).

And as far as that goes - without reopening the entire 'is this a good 
idea?' debate - I find it hard to argue that the internal approach was 
the wrong idea, that the industry should have been asked to provide. The 
industry's self-interest would have been irresistable and, at the same 
time, the whole thing would have become bogged from the outset, with:

- Industry factions arguing for and against any idea of a national fibre 
network;
- Political factions arguing ditto; and
- Nothing happening for ages.

Whatever any government does about national telecommunications 
infrastructure becomes a balkanised political debate. There will be 
left-versus-right arguments (public versus private), economic arguments 
(is this too expensive?), technical arguments (why fibre?), and 
self-interest arguments (this network threatens my business model / I 
can get billions if this goes ahead).

RC