National Broadband Network

[Ice-Wolf]

Far more valuable according to whom? The value of an asset is what someone is willing to pay for it. What someone is willing to pay for it depends on what level of return they can generate from it.

The problem with an all-fibre NBN is that currently the marginal benefit to be extracted from it compared to a more modest FTTN proposal is pretty minimal, despite the massively increased additional cost. You are building in a ton of capacity that is not going to be needed for the foreseeable future. That has a massive affect on the expected ROI when you come to sell it.

What is the expected ROI on Turnbulls CFTN network proposal?

Telstra told Howard in 2004 that a CFTN deployment likely would not make a ROI before it had to be replaced.

Labor switched from a CFTN plan to a FTTP plan after getting similar advice and being unhappy with the responses to their CFTN tender.

If CFTN can not return on it's investment before needing to be replaced then it is pissing money against the wall to delay the inevitable.

 

[Caesar]

Yeah, see, that's still missing the point. It all depends on what the respective networks cost, and what an investor would be prepared to pay for them. And that not only depends on whether an asset will pay for itself, but at what rate it pays for itself.

FTTN might require more maintenance and need to be replaced sooner, but if it proceeds the way the Coalition plan indicates it is (a) much cheaper and (b) more efficient in the sense that is eschews unnecessary capacity. If your goal is to sell the asset at the end of construction you do not want to be selling tons of extra capacity that the buyer has no use for, because that has no value to them. It doesn't matter if a FTTH network will pay for itself if the ROI is so low that this will take many decades. A purchase price will be determined on the value that can be extracted in the short to medium term.

 

[Ice-Wolf]

Yeah, see, that's still missing the point. It all depends on what the respective networks cost, and what an investor would be prepared to pay for them. And that not only depends on whether an asset will pay for itself, but at what rate it pays for itself.

FTTN might require more maintenance and need to be replaced sooner, but if it proceeds the way the Coalition plan indicates it is (a) much cheaper and (b) more efficient in the sense that is eschews unnecessary capacity. If your goal is to sell the asset at the end of construction you do not want to be selling tons of extra capacity that the buyer has no use for, because that has no value to them. It doesn't matter if a FTTH network will pay for itself if the ROI is so low that this will take many decades. A purchase price will be determined on the value that can be extracted in the short to medium term.

No you're missing the point, CFTN can not get a ROI before it needs to be scrapped therefore it is not worth buying.

 

[Ice-Wolf]

http://www.abc.net.au/technology/articles/2013/09/19/3851924.htm

An Interesting article, I'm sure Tony will have the journalist "natural attritioned" shortly

 

[Caesar]

No you're missing the point, CFTN can not get a ROI before it needs to be scrapped therefore it is not worth buying.

If that is in fact true, it will just be bought for less than the construction cost. As would any FTTN network, except FTTN costs far more to construct and the potential shortfalls are much higher.

 

[midorigreenwood]

TPG bought PIPE networks awhile back and inherited a shit tonne of fibre around the country including in the CBDs of the capital cities.

Their plans to move to apartments isn't really that ambitious considering.

Its more a slap in the face of the NBNco who were forced by politics to forego targeting these areas.

 

[Pessimistic]

Ziggy switowski ?

They might as well have put john howard in charge.

Anyone like to take a bet that john howard will be appointed to something within six months

Maybe even GG

 

[Power Raid]

What? I still don't follow your argument. Please explain. Not all houses have river views, nor do they all have 4 bedrooms. I can see how those features can add value for the owner of such a property.
Under the NBN plan EVERY house was to have the NBN. If every single house on the market has a particular feature, then that feature cannot add value to any particular property. But, certain features, whether other houses have them or not, do make life easier for the people living in the house. E.g. roofs, walls, doors, windows, power connection, the NBN.

Your point would be fine by me if it were just going to be a few select homes with the NBN, which is of course now what will happen.

So if the government replaced our fleet of commodores, falcons and others with porches; the second hand market for cars would stay the same (in price)?

And why should a poor non-property owners have to pay and take the risk exposure to cost blow outs to upgrade the property of the rich?

 

[Slax]

Ziggy switowski ?

They might as well have put john howard in charge.

Anyone like to take a bet that john howard will be appointed to something within six months

Maybe even GG

Little 'honest' John won't be appointed to anything. Whilst he'd love the GG job he won't get it.

As for Ziggy, someone needs to get in their and clean up the mess that is teh NBNco. Internally they are a mess, staff turnover is massive due to workloads and other issues.

 

[Dry Rot]

Board of NBN resigns en masse

http://www.smh.com.au/business/entire-nbn-board-resigns-20130922-2u835.html

 

[Qsaint]

Board of NBN resigns en masse

http://www.smh.com.au/business/entire-nbn-board-resigns-20130922-2u835.html

There is also three separate investigation taking place to confirm where the NBN fiasco is up to.

There was a few too many bankers/consultants on that board, the rocket man will be a good addition to the board

 

[Pessimistic]

Rabbott obviously believes the howard years were great and we just need to go back to them

Hankering after a parody of hankering for the fifties is worse than the real thing

 

[RUNVS]

Rabbott obviously believes the howard years were great and we just need to go back to them

Hankering after a parody of hankering for the fifties is worse than the real thing

and clearly the Howard years included download speeds of 3kb a second so Abbott wants to go back to that as well.

 

[yibbida]

There is also three separate investigation taking place to confirm where the NBN fiasco is up to.

There was a few too many bankers/consultants on that board, the rocket man will be a good addition to the board

Fiasco? That is how you can describe it after Turnbull vandalizes it.


And Malcolm Turnbull has released the 2013 Corporate plan that he was banging on about before the election...... The conservatives don't like transparency.

60 Days Turnbull's audit/review was/is going to take. There is 55 Days left.

 

[Power Raid]

I can't believe the NBN board is resigning to avoid accountability for the mess

 

[Caesar]

One could say that resigning is a way of taking accountability.

Regardless of the rights or wrongs of the situation, it is difficult to see how they could remain in their positions given the criticism levelled at them by Turnbull and the Coalition.

 

[Ice-Wolf]

One could say that resigning is a way of taking accountability.

Regardless of the rights or wrongs of the situation, it is difficult to see how they could remain in their positions given the criticism levelled at them by Turnbull and the Coalition.

Turnbull and the Coalition should be hung drawn and quartered for for politicising the NBN and for what they are trying to do to it all to line the pockets of private enterprise at the taxpayers expense.

Turnbull really reminds me of Burke from Aliens, and the taxpayer is who he is ****ing over for a percentage.

Every one of Turnbulls actions have been ones that are designed to destroy NBNco's business case if it was a private company and Turnbull was doing this he could be facing charges.

 

[Caesar]

It seems to me that most of the criticism was pretty warranted. Do you really think that NBNCo has managed the rollout well?

 

[Ice-Wolf]

It seems to me that most of the criticism was pretty warranted. Do you really think that NBNCo has managed the rollout well?

I think they should have fired Syntheo sooner but other than that it has been no different to any other major project.

Make no mistake most of the ****ups can be levelled at private enterprise not doing what they said they would.

 

[DivideandMultiply]

If Ziggy is appointed head of NBNco... well hahahaha what a grand act of self sabotage.

 

[medusala]

Well then the taxpayer is doubly ****** as a FTTP network would be much more valuable.

If its so valuable why wouldn't the private sector build it?

 

[Patrick Bullet]

So if the government replaced our fleet of commodores, falcons and others with porches; the second hand market for cars would stay the same (in price)?

I am not quite sure what the critical part of your scenario is. Are you asking what will happen tot he price of second hand cars if all of our cars were replaced by Porsches (and the old cars just vanished). In other words will the prices go up because second hand cars are now Porsches?

Or are you asking me what would happen if the government sold its entire fleet of cars at the same time (and the fact that they are being replaced with Porsches is largely irrelevant)? If it's this second thing, then I really can't see what it has to do with what we were talking about so I'm going to go with the former.

If every single car was replaced by a Porsche, the market for second hand cars would stay the same. You have to understand that the price of a second hand car is simply what someone is willing to pay for it. This will be determined by many things that have nothing to do with the brand of the car. These things include: what other cars there are and how much the owner wants for them (answer in this case = all other cars are Porsches as well so that won't help, and some owners will be more desperate than others to sell), how much money they have, how much they can get their hands on, how desperately they want a car.
The only reason Porsches attract higher prices than other cars right now, is that people are willing to pay more for them; one of the reasons for that is that Porches are 'status' symbols. Good luck making them status symbols if every man and his dog has one.
Short answer: if every car on the market is a Porsche, then the price of Porches will drop but the overall market for cars won't change.

Same with houses. The value of a property is not the sum of the costs of all of its parts - it is simply the price someone is willing to pay for that property. Money doesn't come from thin air. If every house gets a $5000 upgrade (e.g. NBN connection), it does not follow that every person looking to buy a house will suddenly be willing or able to spend an extra $5k on their house. It's not like a real estate agent could argue that this house is somehow special because it has NBN - so what if it does? the house next door also has it and the one in the next suburb. In fact every house the buyer was considering has it, so why would any buyer pay more for a feature he could get on every other house? I don't see what's so complicated here.

Well, that was before the change in government. Now, the NBN connected houses do indeed have a value-adding feature.

And why should a poor non-property owners have to pay and take the risk exposure to cost blow outs to upgrade the property of the rich?

You'll have to explain the logic here a bit more for me.
Notwithstanding, I'd say now a poor tenant is even worse off as he will be at the mercy of his landlord who doesn't really have much of an incentive to go broadband (unless maybe the week before he puts the property on the market). Tight landlord = no broadband.

 

[Qsaint]

Turnbull and the Coalition should be hung drawn and quartered for for politicising the NBN and for what they are trying to do to it all to line the pockets of private enterprise at the taxpayers expense.

Turnbull really reminds me of Burke from Aliens, and the taxpayer is who he is ******* over for a percentage.

Every one of Turnbulls actions have been ones that are designed to destroy NBNco's business case if it was a private company and Turnbull was doing this he could be facing charges.

Hang on reality on the ground killed the business case. The NBN is 2% complete.

In what world does a govt agency spend public money on a PR firm to lobby the opposition and engage lawyers to try to stop the govt changing policy. The lack of governance at board level is a real issue.

 

[Pessimistic]

Hang on reality on the ground killed the business case. The NBN is 2% complete.

In what world does a govt agency spend public money on a PR firm to lobby the opposition and engage lawyers to try to stop the govt changing policy. The lack of governance at board level is a real issue.

A world where a government take the right step in setting up infrastructure australia to rate projects and priorities, then routinely ignores it for political expediency

 

[Todman]

Turnbull and the Coalition should be hung drawn and quartered for for politicising the NBN and for what they are trying to do to it all to line the pockets of private enterprise at the taxpayers expense.

Turnbull really reminds me of Burke from Aliens, and the taxpayer is who he is ******* over for a percentage.

Every one of Turnbulls actions have been ones that are designed to destroy NBNco's business case if it was a private company and Turnbull was doing this he could be facing charges.

The NBN was always a political issue. Rudd and Conroy were unhappy Telstra was now a public listed company and so they had no influence on its decision other than regulatory.

The Rudd government want telstra to build a network that the company had no control over so rightly Trujillo told Rudd to stick it were the sun only shines on true believers.