Coalition to announce $3.5bn NBN Upgrade to Roll out Fibre ‘Deeper and Closer to Homes’

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Formed under the Australian Government’s Department of Infrastructure, Transport, Regional Development, and Communications, the National Broadband Network is tasked with providing an environment in which every Australian can have access to and benefit from creative experiences, communications services, and culture. The NBN does this by delivering:

Strategic policy development and advice
Effective grants and program management
Regulatory management
Collaborative stakeholder engagement

The Coalition’s Big News

The Coalition–one of the two major political parties in Australia–is set to announce an upgrade of $3.5 billion to the National Broadband Network. The package is meant to help the NBN rollout businesses and homes better internet speeds through fibre connectivity.

While addressing the National Press Club, Paul Fletcher, the communications minister of the federal government, will also explain further on the Coalition’s tactic of investing in additional fibre when it is economically viable. Labor has previously been at the forefront of criticising the Coalition for taking up the premises model and ditching the former administration’s fibre.

What this will mean for Australians

Set to begin in a few months, the project will have several implications. If all goes as planned, it’s estimated that by 2023 fast internet connectivity will be accessible to nearly ten million Australian homes. In the face of the COVID-19 pandemic, the National Broadband Network has met increased pressure, as most Australians are now working from home. High-speed fibre cables will be fixed in all parts of the country through this plan which will provide everyone access to a free faster connection.

Based on speech notes delivered before the announcement, Minister Paul Fletcher expressed that people would have to demonstrate the need for this higher-speed connection. He added that the new fibre-to-home service would only be availed to individuals that request it. The project is estimated to create over 25,000 new jobs.

What to Expect from the Communications Minister’s Speech

Fletcher is expected to announce that the private debt markets will be lending $3.5 billion to National Broadband Network for upgrading the existing NBN architecture. Part of it will go towards NBN’s initiative to take fibre further into neighbourhoods that get their internet through the (FTTN) technology. The upgrade will allow achievement of speeds that run up to as high as 1 Gigabits per second.

The money will also go towards resolving cabling issues affecting homes in various neighbourhoods with the network. NBN will also use a portion of these funds to upgrade the hybrid fibre-coaxial network. The upgrade will also improve the consistency of internet speeds.

What the Upgrades will mean

Minister Fetcher is expected to say that with the upgrades, ¾ of Australians with fixed-line premises will access super-fast broadband speeds by 2023. He will further state that the Coalition is now more prepared to build and improve on the current NBN architecture and bring fibre closer to businesses and homes.

During the rollout, the upgrade will reuse the new fibre built and further extend it to the suburbs. All this is possible now that NBN has proved its business model, and its cash flows are substantial and growing. This allows the company to borrow from the private debt markets.

What is the Plan?

According to the anticipated government press release, NBN will build local fibre networks running along street frontages in areas with FTTN. Thereafter, fibre will be channelled to a household depending on demand.

What the Finance Minister had to Say

The announcement comes weeks before the government releases its budget, so all eyes are also set on policies to evade the situation of the country diving into recession. Responding to the announcement, Mathias Cornmann–the finance minister–termed these upgrades as major investments in infrastructure that will prompt demand.

According to Cornmann, the investment is expected to generate about 25,000 new jobs in a span of two years. In the long-run, it would see a $6.4 billion rise in Australia’s GDP per annum in 2024. The minister also said he would promote $300 million in funding for the NBN to work in unison with local councils and government to ensure regional Australia’s broadband services are improved.

Is this a Good Move?

Anthony Albanes, Australia’s opposition leader, in his address to reporters on the announcement by the Coalition, said that the previous Labor government had rightfully criticised the NBN. His spokesperson said that the attack launched on fibre by the Coalition was purely political and not about cost. In a recently-issued statement, Michelle said that for a long time, Australians have been burdened with paying a lot for a broadband network that under-delivers. She saw no point in spending $51 billion of taxpayers’ money on a copper network that is doomed to fail.

NBN’s outgoing CEO in 2018 admitted that their dependence on copper was responsible for slow internet speeds and higher fault rates. Nevertheless, it helped in faster and affordable network delivery.

References

Written by The Original PC Doctor on 3/10/2020.

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