[AusNOG] background radiation was: "i want a pony!"(wasRe:Longlive the NBN. The NBN is dead?! [personal])

[Tim McCullagh]

----- Original Message ----- 
  From: Matthew Moyle-Croft 


  On 12/08/2010, at 8:09 PM, Tim McCullagh wrote:

    Then it was sold because the community said it was to inflexible expensive 
    and those in power said  that we needed competition to fix it.


  That's not the reason it was sold ...

  I was referring to the introduction of Optus as a second carrier


    Then Optus rolled out a cable network and Telstra rolled out the same 
    network.  None of them made money.  Optus made a deal with Telstra to reduce 
    its exposure to some costs.  Everyone then said don't invest we will resell 
    Telstras network.  Telstra said fine but the wholesale price will be similar 
    to telstras retail price.  The industry complained to the government and the 
    ACCC.  Governments on both sides with the ACCC tried to level the pricing, 
    some services were declared and the ACCC stuck its nose into the market 
    which resulted in less competitive infrastructure



  I think that's a bit of a wierd take.


  Telstra, being fully vertically/horizontally integrated and having, well, ALL the customers and profit and infrastructure is a hard beast to start out competing against when you start at the beginning.    It's a monopoly and it is happy to use it's market power to squish.

  Absolutely  this is where regulation comes in to the mix 


  Optus, in the above example, experienced this.  Telstra didn't need a cable network, but did it just to stop Optus.  It was quite effective as a strategy for Telstra.

  Exactly and the regulatory environment was very lacking.  There should have been a tender to see who could buy the rights to build such a network  (paytv) to introduce network competition which would have involved say some third party access undertakings and say a 5 year or so honeymoon period.  The same could apply to building an NBN


    .......
    ......
    then
    we ended up where we are today.  Noone investing in fixed line 
    infrastructure other than Telstra other than greenfield estates.   I still 
    fail to see why Telstra should have to spend the capital to get small 
    returns on investment in what is a risky business, especially with 
    governments forever sticking their nose in without understanding the 
    consequences.



  How is Telstra's business "risky"?   Seriously?   Look at their annual report, the profitability and tell me where the risk is?

  If the governement is going to build theNBN and close down the Telstra copper network, then how or why would Telstra want to keep spending $5billion or more on capital works?  Why was there a 10% decrease in telstras profit margin released today?   I think that answers it.





    I often wonder what a difference we would be seeing today if the conduit 
    network was open access at inexpensive rates, yes something as simple as 
    that may have revoltionised fixed line networks.  It would have resulted in 
    multiple networks ................perhaps



  Conduit is indeed available.   But, that's only part of the story.
  But at $6 per meter pa that destroys any case for rolling out ftth



    I will be as brave as to state that the reason we are in the situation we 
    are today is because of governement interference in the market without 
    addressing the structural ramifications of such interference.  Eg    the 
    megapop dial deal done with Telstra before one election and labors NBN which 
    has basically put all development on hold for 3 years to give 2 of many 
    examples



  FTTN started WELL before Labor - remember back in 2005 when Sol came to town? 

  Yes and Telstra couldn't get the regulatory certainty to build it.  If any Telco spends the capital they should be able ot get a return

    That was the problem.   Blaming Labor for that is, well, a bit wrong.

  I don't see where I was blaming labor for the fttN.  I gave 2 examples one a coalition decision  and one labor decision.  I have met conroy a couple of times and he is a total goose.  His announcement today regarding download limits only reinforces my perception.


    Going down the NBN path will take competition back 30 years.   As for those 
    that say that the new model will be about service, yeh right.  If there is a 
    fault we will all have to report it to NBN (monopoly tell someone who cares 
    network) and wait for them to test and fix as opposed to logging into our 
    own systems and determining what the problem is and just fixing it.  I can 
    see vividly the case of storm damage and massive delays, unless NBN has 
    staff sitting around, not likely



  I think you're just trying to see failure.   
  Rubbish we should learn the lessons from the past and not repeat them, and I have 20+ years associated with maintaining external plant infrastructure, performed operations research at state level on external plant in Telstra, should I go on..............   I will probably look back on this discussion and say I knew that would happen in just a year or so.  I may have even been thinking that today if the NBN had been rolled out in Melbourne.   I hope I am wrong, but so far I have not seen any analysis on how maintainable Ftth is on power poles.  i am not saying on all power poles routes, but mainly the suburban green leefy areas like I saw on the Tele early this morning.



    The more I think about this the more I see it as a back to the future dumb 
    idea.  I am not into the wank factor of having fibre like some.  I just want 
    something that works and that I can afford and this is what my customers 
    tell me as well



  I want something that works and doesn't break every year (as my phone line at home does because of no maintenance of the CAN).   I'd also like something which scales in the future.


  Again, tell me -> how would, if we didn't do NBN, fix the regulatory environment and how would your suggestions be valid for the next 40-50 years?
  I offered a couple of examples above.  There are more things that could be done in that area without throwing away 3 existing networks and establishing the PMG mk 2.  There is no reason the CAN can't be made reliable and can't meet the needs of Australians with evolutionary upgrades as the need arises.  I can state this with the authority and the expertise to do so.  I have maintained such a CAN network and been responsible for reducing the fault rates from 40+% pa to 3% of services per year.  

  I don't have all the answers, but I would start with a radcomms type of forum and bring all the carriers together to thrash out what would encourage investment in open access infrastructure.  I would do it in an open environment and I would if I was the minister make it clear that this is the place to thrash out the future industry regulation which would be given a reasonable amount of time before any changes would be made.  I would also ask carriers to put their money where there mouth is.  If a carrier wants to make a claim then they may be asked to back it up, in order to exclude the tyre kickers making unrealistic claims.    I remember going to the productivity commission a few years ago now and being able to sit there and eye ball a very senior Telstra Executive who was handling the truth carelessly and ask 3 questions and have him back track completely, as soon as he recognised who I was.  That is why an open forum is important, it stops some handling the truth carelessly or making unfounded statements without review.  Regulation is not Intellectual property so no carrier should have a problem discussing it in an open forum.  It really isn't something that can be specified in a short email



  Otherwise maybe you don't actually have a plan other than to do nothing and wait for failure?

  Absolute rubbish.  I started rolling out FTTH in 2005 in a brownfield environment.  Before it became sexy.  It was soveriegn risk that brought it to a halt, and I could write a book on the issues.  I still have a large amount of equipment stored in order to kick off again if I so choose too.  I am still deploying the necessary conduit infrastucture in strategic areas.    I have written to Conroy and spoke to him about some of the solutions.  In doing so I have always stated I don't have all the answers but I have offered some solutions that I know have worked.  I may as well have been talking to the pot plant in my office,  he is a goose and I have no that is absolutely NO faith in the abilities of his DBCDE department.  After speaking to some of the Gibson Q and other so called consulatants I have come to realise that many of the so called experts or claim to be experts have no idea.  Then when I asked some of the early deployers in FTTH in greenfield deployments whether they had been consulted by either DBCDE  or NBNco and I am yet to find any that have, I get very concerned about the quality of expertise being used.   Most of the support is coming from those consultants that are looking for a new funding source to suck on and those that think fibre is sexy.  Many of the same people are under some false illusion that the price will be the same as now.  It may start there but it will quickly rise like power water and council rates have in recent years.  They are dreaming to think otherwise.  Talking 40 year ammortisation timeframes is plain stupidity.  I could go on but I need to get a life and do some other things  right now



    regards

    Tim 
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