[LINK] Turnbull's address to the National Press Club

[Martin Barry]

$quoted_author = "David Boxall" ;
> 
> Transcript with references and link to the Q&A that followed is at: 
> <http://www.malcolmturnbull.com.au/uncategorized/address-to-the-national-press-club-australia/>.
> 
> One comment that struck me:
> "What about New Zealand?  Over the same timeframe but for a net cost of 
> only $600 million[4], the Government’s Ultra-Fast Broadband (UFB) 
> initiative will ensure 1.2 million (or 75 per cent) of households will 
> have fibre to the home (FTTH) delivering similar speeds as the 
> Australian counterpart.
> 
> The remaining 25% will be covered by the $300 million Rural Broadband 
> Initiative and will receive broadband over the existing and enhanced 
> fibre to the node (FTTN)[5] network (which currently covers 84% of New 
> Zealanders "...
> 
> If New Zealand already has a comprehensive FTTN network:
> - How did Australia get so far behind and;

We are behind. What I find odd is that none of the Liberals want to explain
how this happened on John Howard's watch. They will probably trundle out
OPEL but it was just the rural and remote component, there was no FTTx of
any type in there.


> - Is the New Zealand example truly comparable, given that we're starting 
> from so far behind (among other things)?

Well, that's the interesting bit. You need to compare like with like. So I
was trying to figure out what that $600m represents seeing as the NZ
government itself is not actually building anything.

>From the footnotes:
"[4] The Government via Crown Fibre Holdings is providing $1.35 billion in
loans and equity to the various fibre companies including three entities
sponsored by electricity lines companies and Telecom NZ (via its network
company spun out as Chorus). These investments are intended to be repaid as
and when customers are connected so that the Crown carries in large part the
cost and risk of slower take up. The $600 m figure is the Government’s
estimate of the NPV cost of the investment over its life."

So he seems to be comparing the full cost of building the NBN with just the
NZ government's cost of subsidised loans. My understanding is that the Au
government's maximum capital injection was forecast at $27b. If you compare
that with the NZ government's loans of $1.3b the NBN still looks like a
bigger outlay but given the different geographies of the two countries that
seems about right.

While the NZ model does make use of private capital, those sources will also
be expecting a commercial rate of return, much like the Au Government is
expecting from NBNco, so I don't really understand his arguments about
wholesale charges being too high and hence making retail prices
unaffordable.

cheers
Marty