Internet Australia chief executive Laurie Patton says the latest report on the National Broadband Network, showing losses of $1.8 billion, heralds the “last nail in the coffin” for the beleaguered FttN rollout using Telstra’s ageing copper network.
“We are building a redundant network that will cost us a fortune to replace and at a time when NBN customers are routinely expressing their dissatisfaction with the speeds they’re seeing. You only need to read the comments on social media to know the community’s unrest is growing,” Patton says.
Patton points out that, according to NBN Co, there’s been a significant increase in take-up of its broadband services, however he says this does not appear to have “helped their bottom line much”.
“The fact is ARPU (average revenue per user) is not growing at a rate necessary to generate the sort of cash flow required at this stage of the project.”
{loadposition peter}Internet Australia has previously argued that the NBN wholesale pricing regime is flawed, something that Patton says Communications Minister Mitch Fifield undertook to have reviewed late last year.
“The fact is RSPs (NBN’s retail sales agents) make better margins for themselves by selling the slower speed tiers. Plus they risk receiving more angry customer complaints if they sell the higher speed packages and NBN fails to deliver.”
Patton says NBN Co chief executive Bill Morrow’s assertion that Australia doesn’t need “gigabit speeds” as simply “spin that would impress the Australian cricket team”, and reiterates IA’s long-held argument that the country should be building a “future-proofed NBN”.
“It’s not about what we need this year, or next year, it’s about the future. It’s about our ability to compete in a digitally-enabled world where other countries have high-speed broadband networks that already leave us behind.”
And Patton again cites figures from Akamai, showing that Australia is currently ranked around 50 to 60 in average global broadband speeds. “Several years ago we ranked 30th. We hover around 10th in the APAC region.”
IA’s recently elected chair, Anne Hurley, said she was particularly concerned that NBN Co seemed to think everything was fine, but said she was comforted by comments in the report indicating that NBN Cowas starting to look at using more modern technology.
“While I’ve only recently joined IA, I’m totally supportive of everything the organisation has been saying for some time about the NBN and the need for better broadband. I’m hopeful that we can work closely with NBN Co in future as they deal with the challenge of meeting the government’s expectations and those of the community”.