[AusNOG] Aust Govt will build National Broadband Network, no company will be awarded the tender.

Matthew Moyle-Croft mmc at internode.com.au
Fri Apr 10 15:11:06 EST 2009

lists wrote:
> Last night I saw reference to 70% of the network being on power poles 
> and only 30% underground. emm  I hope they don't get bush fires, 
> cyclones, cars running into poles, garbage trucks pulling the cables 
> down etc etc etc.
Does your electricity on power poles go out much because of this?   Mine 
doesn't.   I think you're overblowing the risk here.  Does your Optus 
Cable/Foxtel go out?   I'll point out that undergrounding cable didn't 
stop the San Jose vandalism last night!   I've had more issues with 
water getting into Telstra's Cu cables going to my house than overhead 
power issues.   Heck, the water pipes in the street here crack three 
times as often as the electricity has gone out due to someone doing 
external aggression on power poles!

Overhead fibre/coax is extremely common around the world.  US/Japan 
especially.  One of the reasons they have many more last-mile networks 
than us is that they're not so precious about this.

Quite frankly most people have little understanding or appreciation for 
external plant and street furniture.  They finally notice things that 
have been there for years and get all precious about the risk, ignoring 
the fact that nothing has happened.

> Copper cable is easy to locate and make temporary repairs quickly, not 
> to mention copper is a lot tougher than fibre.
I think that's debatable - fibre is quite tough.  You can make it as 
tough as you want - depending what you order.  (Ever seen the armoured 
submarine cable for shallow waters?)

On power poles faults are easy to find/fix - you just look up!   Often 
fibre repairs get a bad rap because the cable is quite strong - so by 
the time it's snapped it's really messed up (eg.  ever seen it fibre 
really messed up because of a big earth drill pulling and snapping it?   
Cu cables tend to be so heavy they break in different ways.

Doing Cu repairs is time consuming and hard on large cables.  Fibre 
splicing these days can be a lot quicker - you can much more easily run 
temporary fibre cables than Cu ones.   I'm not sure if you've ever 
watched someone repair or punch down a 1200 pair street cable, but it's 
a lot harder than doing fibre.
> I fellow can locate and make temp repairs to copper cable, fibre 
> splices need to be prepaired and protected making temporary repairs 
> that would take 15 minutes on copper take 4 or 5 hours and more than 1 
> person on fibre.  If the $43Bn cost estimate is based on 70% aerial 
> deployment then it may well blow out to $100BN + if it were to all be 
> put underground.
If you've got real cable damage then fibre ain't going to be hard to 
fix.  Maybe you need better splicing guys?  I can give you some 
references ...

So, why underground it unless necessary?   The rest of the world has 
moved on from this curiously Australian dislike of overhead.

> My analysis would be that if Rudd is as keen as he is to build FTTH 
> then he needs to buy/ re nationalise Telstra and build out the Telstra 
> network and separate it etc.  That would be a cheaper way to do it.
It'd cost $40b to buy Telstra, then another $43b to do FTTH.  So instead 
of $43b you're out $83b.   What's the point of that?  
> Might I also add that not all government assistance needs to be in 
> cash form.  Governments could also use their business as a catalyst to 
> encourage investment etc.  This would result in a better outcome for 
> taxpayers who ultimately pay for all of this.
I don't think people have thought some of the investment part through.   
Nor why the government is doing it. 


> Regards
> Tim
>     ----- Original Message -----
>     *From:* Glenn Powell <mailto:lists at glenno.com>
>     *To:* Tony <mailto:td_miles at yahoo.com>
>     *Cc:* ausnog at ausnog.net <mailto:ausnog at ausnog.net> ; lists
>     <mailto:technical at halenet.com.au>
>     *Sent:* Friday, April 10, 2009 9:48 AM
>     *Subject:* Re: [AusNOG] ALERT: Aust Govt will build National
>     Broadband Network, no company will be awarded the tender.
>     Id like to be a fly on the wall at Telstra right about now.....
>     1. Do they sit back and hope they pick up a sizeable chunk of
>     equity in the new company and sizeable part of the design and
>     build (even though we all know the current CEO really does not
>     like wholesaling).
>     2. Outside of their cable network, do they speed up the deployment
>     of road side cabinets and start to deploy VDSL2 or Fibre.
>     3. Drop their retail prices by 50% sign up customers to 36month
>     plans and attempt to make the economics look very bad for the NBN.
>     The appointment of the next Telstra CEO became very interesting as
>     of Tuesday....
>     -----Original Message-----
>     *From*: Tony <td_miles at yahoo.com
>     <mailto:Tony%20%3ctd_miles at yahoo.com%3e>>
>     *To*: ausnog at ausnog.net <mailto:ausnog at ausnog.net>, lists
>     <technical at halenet.com.au
>     <mailto:lists%20%3ctechnical at halenet.com.au%3e>>
>     *Subject*: Re: [AusNOG] ALERT: Aust Govt will build National
>     Broadband Network, no company will be awarded the tender.
>     *Date*: Tue, 7 Apr 2009 14:20:58 -0700 (PDT)
>     It all depends whether you want to be optimistic or pessimistic about it.
>     Uptake is an issue, but on the subject of price I don't think the final figures you've quoted are unreasonable ($80-$100 per month).
>     If you look at Internode's current FTTH offering as an example:
>     http://www.internode.on.net/pdf/products/home-fibre-pricelist.pdf
>     The base plan (25/1Mbps, with 5GB quota) is $50pm. I believe this includes NodePhone (SIP phone service), but if you want a traditional PSTN interface, that is an extra $25pm. That's a total of $75 per month.
>     If you want to really start playing with figures, you can factor in inflation. If the debt is taken out in todays money, but repaid in the future it works to your advantage. $75 today at 3% inflation is $95 in 8 years time when it's finished. If you extrapolate that to your 40 year payoff period (48 years from now, allowing 8 years to build), then it becomes $310 per month. As long as you pay the interest only on the debt, the debt doesn't increase.
>     regards,
>     Tony.
>     (If I've got any of my figures wrong, feel free to correct me, it is early)
>     --- On Tue, 7/4/09, lists <technical at halenet.com.au <mailto:technical at halenet.com.au>> wrote:
>     > From: lists <technical at halenet.com.au <mailto:technical at halenet.com.au>>
>     > Subject: Re: [AusNOG] ALERT: Aust Govt will build National Broadband Network, no company will be awarded the tender.
>     > To: ausnog at ausnog.net <mailto:ausnog at ausnog.net>
>     > Date: Tuesday, 7 April, 2009, 8:33 PM
>     > Hi All,
>     > 
>     > I don't like to be a wet blanket however personally I don't
>     > see how this can 
>     > be based on a viable business model.
>     > 
>     > $43, 000 million is $2000 per Australian  ouch. 
>     > It would be to depressing 
>     > to dived the number by the number of tax payers
>     > 
>     > using rounded figures there are about 10 million homes
>     > =  4300 per home investment
>     > assuming ever house 1. uses the internet and 2. takes up
>     > the service and 3. 
>     > a 40 year payback period with a  7.5% return (very
>     > long given the 
>     > electronics will have a lifespan of 10 or so years) then
>     > the business will 
>     > need to charge at least $28.30 ex to pay for the
>     > investment. plus add 
>     > running costs margin etc etc.  So I guess there will
>     > not be any change out 
>     > of $40.
>     > 
>     > The above is so totally unrealistic
>     > It is more likely the internet penetration is around 50% of
>     > which x% will 
>     > want a fixed connection.  So best case is the monthly
>     > fee will need to be 
>     > twice the $28.30 at least = 56.50 +
>     > GST.   How many customers want to pay 
>     > $80 to $100 per month for broadband? If there is not a
>     > large take up the 
>     > figures simply get worse
>     > 
>     > of the 50% some will use mobile broadband
>     > 
>     > All this equalls a bad investment.   There
>     > should be more emphasis on 
>     > filling black spots were there is a need/demand than
>     > wasting money 
>     > duplicating existing infrastructure.  While some may
>     > believe it will bring 
>     > Telstra to heal I doubt it.  This could end up being a
>     > white elephant, 
>     > especially if Telstra decides to build FTTH and other
>     > retail operators 
>     > decide to build out there own networks.  Then there is
>     > the issue of what it 
>     > will do to the business models of companies that have
>     > deployed ADSL 2+ 
>     > dslams.  What a financial mess, perhaps sanity will
>     > prevail. Perhaps the 
>     > government will buy back all the Telstra shares and
>     > restructure it to what 
>     > they want.  Who knows?  This decision seems
>     > rushed and ill thought out
>     > 
>     > Regards
>     > 
>     > Tim
>     > 
>     > 
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