A Senate headache for Turnbull's NBN

The Senate Select Committee on the National Broadband Network has so far received 39 submissions and the contents are unlikely to please the communications minister Malcolm Turnbull.

The submissions provide little more than lukewarm support for the Coalition’s NBN and if the minister is looking for something positive out of this exercise he’s in for a disappointment.

The Senate committee has been tasked to “inquire into and report on the government's reviews of the NBN and the governance of NBN Co, with interim reports as the committee sees fit and a final report on or before 10 June 2014".

Turnbull’s supporters rightly claim that the sitting Senate is using its last six months to exact a vendetta on the government and its NBN policy. But the introduction of a new Senate come July might not remedy that situation.

The WA election complication

There is no guarantee the new Senate will support NBN 2.0 and recent remarks by Clive Palmer about Qantas ownership provide clear guidance that his party will not blindly support the Coalition when it comes to implementing bad policy.

Palmer is yet to make a substantive public statement on the NBN; however, he is a businessman who relies upon the bush for a living so he should be attuned to the idea that business and residents of regional and remote areas shouldn't be left behind.

Palmer’s remarks on a Google Hangout hosted by The Sydney Morning Herald provided an insight when he said, "If we are going to do large projects or things for the country, we need to take our time, properly plan it, properly cost it, and make sure it is something that is a considered decision. It doesn't mean we shouldn't do these things; it means that the manner in which we do them must be in the best interest."

Palmer’s remarks have been echoed many times over the past five years by those who believe the NBN, a nation building infrastructure project, should have been placed under the control of a non-political committee tasked with costing, planning and ultimately guiding NBN Co in its efforts to upgrade the access network nationally by 2020.

To complicate matters the High Court, sitting as The Court of Disputed Returns, has ruled that West Australians need to go back to the polls. With 1.5 million voters now set to cast their ballots for six senators, all bets are off. The Coalition government could potentially lose control of the Senate and, along with it, the support it needs to pursue NBN-related legislative changes.

Submission simplification

The Senate select committee will accept submissions until the end of this month and the 39 lodged so far highlight a clear divergence in what the industry wants and what the Australian public is hoping to get.

The Competitive Carriers Coalition (CCC), which represents non-dominant telecommunications carriers, has again called for a telecommunications policy and regulatory environment that adheres to a set of principles including:

an effective competitive market

structural separation of 'essential facilities' (that is, facilities that exhibit natural monopoly characteristics)

robust price regulation of access services to the structurally separated essential facilities

national wholesale communications markets

prevent monopoly rents and 'gold plating' by the monopoly wholesaler

avoid locking in legacy technology that inhibits competition

policy to upgrade existing fixed line networks must be based on structural separation of the monopoly element and specify a pathway to the FTTH

regulatory pricing and access principles should be maintained and enhanced, and arrangements where competition is 'traded off' to encourage investment in the short term – through, for example, regulatory holidays – avoided

in locations where a return is not sufficient to support commercial infrastructure investment, policies to encourage investment should promote competition and broadband access

A call for the structural separation of Telstra resulting in copper and HFC ownership, maintenance and operations transferred to NBN Co highlight the CCC’s belief that the industry needs a shake-up now if a next generation wholesale network is to be successful.

As one of the more ardent industry submissions, the CCC has provided a brief submission that does not provide important substantive clarification. For example, the submission calls for an upgrade pathway to FTTH if NBN 2.0 is implemented, but does not provide a date by which FTTH should be implemented nationally.

What point is an upgrade pathway without clear guidance that the upgrade is to occur?

There is also no mention of how the wholesale network will operate. Will the traffic be sent over the wholesale network utilising “best effort” transmission or should quality of service, capacity and traffic class management be implemented and by when?

A review of the industry submissions made to the Senate select committee highlights the industry’s ongoing inability to adequately justify why a next generation wholesale fibre access network is needed, what it should look like and how it should be operated.

The iiNet submission focused on the ability to transfer electronic documents faster than what is possible over existing “best effort” networks but does not adequately argue why small to medium enterprises need the NBN when they have the option to utilise fibre Ethernet readily available from major providers in many areas.

The lack of technical details, even explained in layman’s terms, negates much of the argument being put to the Senate select committee. It is almost as if the industry does not want to say too much lest it say something that it will later regret.

Local government picks up the slack

The local government submissions are a welcome addition to what has been a disappointing effort by the telecommunications industry to sort out the mess that it finds itself in. Local government is becoming a vocal critic of any shift away from the original NBN plan and for many local governments the move to NBN 2.0 will mean there is considerable loss of time, funds and energy spent on building local community opportunities based around a next generation fibre access network.

The City of Greater Geraldton, which is an early recipient of FTTP, highlighted the positive benefits that FTTP was bringing to the region, forward planning for future opportunities and implementation of projects where FTTP had arrived. The sentiments expressed by the City of Greater Geraldton were echoed by other local government submissions.

The City of Greater Geraldton submission concluded by saying: “We are of the firm belief that continuing the rollout of FTTP will achieve a far better outcome for the future. We see continuing to make use of a degraded copper network system is a stop-gap method which will mean we are only delaying the inevitable and this, of course, will eventually see taxpayers pay far more to replace the copper with fibre at a time in the future.”

Submissions to the Senate select committee by individuals generally provide outright support for Labor’s NBN, though there are a couple of submissions that argue that cheaper alternatives should be considered including the expansion of HFC networks rather than installing FTTP.

The Aurora gaming submission highlights the frustration that online gamers have today and any thoughts that the HFC networks currently provide a better connection than ADSL2+ are dispelled when they write:

‘Several of our members are connected via Telstra and Optus HFC cable. Those members’ experiences to date are woeful, as during peak times, the congestion on these networks is so bad that the speeds slow to a crawl and the video games that we enjoy playing together become what is known collectively as a “lag-fest”.’

What is missing from the ongoing debate is a clear statement of what the next generation network should be and when it should be provided. A reminder of what that should entail can be found here.

Will the Senate select committee’s report include clear statements of technical outcomes that are to be achieved by 2020 or 2025, or will it equivocate and lose the opportunity to set a bar that the Coalition needs to hurdle?

Mark Gregory is a Senior Lecturer in the School of Electrical and Computer Engineering at RMIT University