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</o:shapelayout></xml><![endif]--></head><body lang=EN-US link=blue vlink=purple><div class=WordSection1><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif";color:#1F497D'>+1<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri","sans-serif";color:#1F497D'><o:p> </o:p></span></p><div><div style='border:none;border-top:solid #B5C4DF 1.0pt;padding:3.0pt 0in 0in 0in'><p class=MsoNormal><b><span style='font-size:10.0pt;font-family:"Tahoma","sans-serif"'>From:</span></b><span style='font-size:10.0pt;font-family:"Tahoma","sans-serif"'> AusNOG [mailto:ausnog-bounces@lists.ausnog.net] <b>On Behalf Of </b>Mark ZZZ Smith<br><b>Sent:</b> Wednesday, September 18, 2013 6:25 AM<br><b>To:</b> Bevan Slattery; Robert Hudson; Paul Wallace<br><b>Cc:</b> ausnog@lists.ausnog.net<br><b>Subject:</b> Re: [AusNOG] Screw the NBN, says TPG: We'll do our own FTTB<o:p></o:p></span></p></div></div><p class=MsoNormal><o:p> </o:p></p><div><div><p class=MsoNormal style='background:white'><span style='font-family:"Bookman Old Style","serif";color:black'>+1<o:p></o:p></span></p></div><div><p class=MsoNormal><span style='font-family:"Bookman Old Style","serif";color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal><span style='font-family:"Bookman Old Style","serif";color:black'>I think those who yearn for a government owned telecommunications monopoly probably haven't experienced one, and don't know the difference that having competition has made in regards to service costs, diversity of different services, both in variety and range of quality (silver service down to take away), and other economic benefits such as employment in the industry, vendor opportunity etc.. Ausnog itself, and the economic benefits the conference provides, wouldn't exist in a government telecommunications monopoly environment, so these conversations and debates wouldn't even be occurring.<o:p></o:p></span></p></div><div><p class=MsoNormal><span style='font-family:"Bookman Old Style","serif";color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal><span style='font-family:"Bookman Old Style","serif";color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal><span style='font-family:"Bookman Old Style","serif";color:black'>(Regarding PMG, I've recently seen people who remember it saying that it stood for "Public Money Grabbers".)<o:p></o:p></span></p></div><div><p class=MsoNormal><span style='font-family:"Bookman Old Style","serif";color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal><span style='font-family:"Bookman Old Style","serif";color:black'><o:p> </o:p></span></p></div><div><blockquote style='border:none;border-left:solid #1010FF 1.5pt;padding:0in 0in 0in 4.0pt;margin-left:3.75pt;margin-top:3.75pt;margin-bottom:5.0pt'><p class=MsoNormal style='background:white'><span style='font-family:"Bookman Old Style","serif";color:black'><o:p> </o:p></span></p><div><div><div><div class=MsoNormal align=center style='text-align:center;background:white'><span style='color:black'><hr size=1 width="100%" align=center></span></div><p class=MsoNormal style='background:white'><b><span style='font-size:10.0pt;font-family:"Arial","sans-serif";color:black'>From:</span></b><span style='font-size:10.0pt;font-family:"Arial","sans-serif";color:black'> Bevan Slattery <<a href="mailto:bevan@slattery.net.au">bevan@slattery.net.au</a>><br><b>To:</b> Robert Hudson <<a href="mailto:hudrob@gmail.com">hudrob@gmail.com</a>>; Paul Wallace <<a href="mailto:paul.wallace@mtgi.com.au">paul.wallace@mtgi.com.au</a>> <br><b>Cc:</b> <a href="mailto:ausnog@lists.ausnog.net">ausnog@lists.ausnog.net</a> <br><b>Sent:</b> Tuesday, 17 September 2013 10:51 PM<br><b>Subject:</b> Re: [AusNOG] Screw the NBN, says TPG: We'll do our own FTTB</span><span style='color:black'><o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p><div id=yiv4906487528><div><div><p class=MsoNormal style='background:white'><span style='color:black'>**<b>NOT FOR PUBLICATION OR REPORTERS</b>**<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>> But take a look at the HFC rollout maps, and tell me just how successful market forces have been in providing decent infrastructure to everyone.<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>Do you care to provide an understanding of the history of how this occurred? (read below)<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>> Take a look at the inequality of access to decent telecommunications infrastructure provided by an organisation who are legally obligated to provide fair access for all (and still fail miserably to do so).<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>It seems you are arguing that where there is no competition the standard of service often fails to keep pace/be inferior (which I agree with). So I'm not sure what your argument is.<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>> How well has the model you propose worked so far? Really?<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>Bandwidth to Australia in 2000 cost $6,000/mbps. TCNZ, Optus and Verizon risked $1.1B to build Southern Cross. Competition ensued. Bandwidth dropped to $2,000 in 12 months and some 8 years later to $250/mbps in a comfy duopoly. PPC-1 was built and bandwidth dropped to $60/Mbps within 24 months. Wholesale for big bandwidth is now (close) to sub $10/Mbps. I expect that with the new submarine cable systems coming online in the next 3 years transit/bandwidth will be around $1/Mbps within 5 years.<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>It's important to note the previous NBN Co CVC fee was $20/Mbps from the house to the POI and increasing. That is 2000% more than international bandwidth costs before half the network is deployed…<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>There was a Government owned monopoly. Then there were entrepreneurs who committed to invest in infrastructure where they could afford to in order to improve the value for you, the punter. Names like Malone, Teoh, Hackett, Marburg, Preen, Baxter, Bhartia, Ashton, Kestelman and companies like AAPT, Powertel, Primus, Internode, iiNet, Vodafone, 3, RequestDSL, Eftel, BigAir, Optus, TPG, Netspace, Westnet, IP1, Amcom, Comindico, PIPE Networks, Nextgen Networks have all invested money to deliver greater value and competition to the public.<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>If it wasn't for Optus committing Billion$ to build the original HFC network to bypass the last mile monopoly then there would probably be no HFC network at all. Sadly at the time the Government owned telecommunication company engaged in "van following" to overbuild the competing carrier (Optus) and halt their progress. It worked.<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>And Telstra's commitment and build out of NEXTG was remarkable and leading.<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>It was competition from carriers committed to building DSLAM's that saw the HFC networks reduce their pricing as ADSL became more available and more importantly more AFFORDABLE. It took Internode, iiNet, TPG, Primus, Netspace, Eftel etc. to offer auto-trained ADSL2+ before others provided same and they ended up providing that nationally. For a shareholder based company to invest they have a higher standard and level of return to achieve, because for said companies the risks are higher and the Directors could go to jail if they get it wrong.<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>> And again - the NBN does *not* cost us (the nation) $37b. Or even $90b if you choose to believe Turnbull's build costs.<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>Sorry but it does "cost" money. However, what determines whether this cost is an expense or an investment is the realistic and real prospect of returns. Now I personally believe that the cost to construct is substantially higher than the $37B. But hey what would I know? I also think the commercial "return" would not be commercial. My guess would be somewhere around 3%-4% with the CVC fee at the current $20/Mbps levels. I'm not saying that this is not acceptable (or acceptable), I'm just saying that this is realistic. I also acknowledge there is a cost to maintain the copper. I'm not sure what that is, but there is also a cost to maintain the fibre (considerably less though).<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>> It costs us the interest on those amounts, but only until the loans are paid back/bonds mature (and the rates are stupidly low)- and then the country owns a modern, high tech infrastructure that will drive the nation forward.<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>There are numerous examples of government investment in infrastructure with the expectations of commercial returns – returns that never eventuated and investments that were written down or written off (Aussat?). It is only an investment until it proves to not yield a return. Some pop and some don’t. The deployment time for a FttP will take at least 9 years so it will be sometime to do so. Also a CVC fee of $20/Mbps is counter productive and a direct imposition to reduce the economic benefit of the FttP investment. Again I'm not saying it shouldn't be done, I'm just saying people need to be realistic and the CVC needs to either go , or be drastically reduced – that will impact yield (by how much?). Let's not get started on the PoI's…<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>As for the FttN NBN the reality is that Telstra is the most logical candidate to roll it out. So TPG either have to wait for the (almost) inevitable mid-span copper cut or take much of the risk out of play for many of their subscribers. They chose the later. It's not "cherry picking" it's common sense.<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>I'm not going to advocate loudly it should be one technology or another, but those on this list not paying $79/month for an ADSL1 256kbps/64kbps connection with a 300MB monthly download quota should perhaps respect what competitive infrastructure investment delivers. The whole "government owned telecommunications infrastructure monopoly protected by legislation" has been done before it was called the Post Master General and it sucked... Big time.<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'>[b]<o:p></o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div><div><p class=MsoNormal style='background:white'><span style='color:black'><o:p> </o:p></span></p></div></div></div><p class=MsoNormal style='margin-bottom:12.0pt;background:white'><span style='color:black'><br>_______________________________________________<br>AusNOG mailing list<br><a href="mailto:AusNOG@lists.ausnog.net">AusNOG@lists.ausnog.net</a><br><a href="http://lists.ausnog.net/mailman/listinfo/ausnog" target="_blank">http://lists.ausnog.net/mailman/listinfo/ausnog</a><br><br><o:p></o:p></span></p></div></div></div></blockquote></div></div></div></body></html>