http://www.smh.com.au/technology/technology-news/nbn-retail-price-revealed-up-to-18995month-20110721-1hqbn.html

Juliar's and Conroy's NBN have been exposed as a complete frauds.

The promises were that the network would provide competition in the high internet industry and provide high speed broadband at rates comparable or lower than current ASDL2 connections.

Once again Juliar's word is worth nothing. The laws have been written so that competition with the NBN is illegal, and Telstra and Optus have been paid to remove their networks and not compete with wireless. The link provided shows the cost to the consumer will sky rocket.

Once again the man in the street is ripped off by Labor's financial incompetence.

Sorry, I checked, it is not twice, but certainly more than I am paying now.

The question is Why are we spending $50bn of the taxpayer's money?

Shorter SM:

'Ignore the headline because it's a blatant lie that's already done its work'.

Very poor form even for you, SM.

@Shadow Minister: The link provided shows the cost to the consumer will sky rocket.

Oh for pete's sake, you've posted rubbish this twice, http://forum.onlineopinion.com.au/thread.asp?discussion=4586#119472 I hope that means I am allowed to give same answer twice:

Seriously Shadow, what school taught you to add up?

It is not at all difficult to compare Internode's ADSL plans to their NBN plans. Here are Internode's ADSL plans: http://www.internode.on.net/residential/adsl_broadband/easy_naked/ So lets compare them to the NBN plans in the newspaper article:

ADSL: $ 30/mo, NBN: $ 30/mo - 30Gb
ADSL: $ 80/mo, NBN: $ 80/mo - 200Gb
ADSL: $100/mo, NBN: $100/mo - 300Gb
ADSL: $150/mo, NBN: $150/mo - 1Tb

I can understand you being deep blue to the core, but this propensity to enthusiastically swallow any drivel that is served up by your side of politics is mind blowing.

Rstuart,

Who taught you to add up.

For $30p.m. I get 200Gb not 30

Compare it to the $50 per month. So it is 66% more expensive!

Considering that this is only projected in a few years, whilst other providers costs are still coming down, this is even more of a rip off.

its sad that rod stuart quotes numbers
withiout adding in 30 buck line rental

i wont be leaving my 50 bucks a year
quater a gig a month

what happend to fibre to the node
for a fraction of the current cost

nbn is going to go bust bigtime
as people realise we all dont want rolls royces

think of the cost
add in carbon poluters scemes
im sick of hearing where will toney get the money from
as much as im sick of the ex banker liberal turnbull into spin
[and juliar..and waynes toss...saying the sxcience is proved]

if only they could speak of the topic
not constantly try to make toney look silly

we got no tax on petrol[for 3 years]
thanks for that toney

steel and brown coal,.wouldnt have the scemes
if it wernt for the fact of toney
scoring big points about that
in fo-cuss group's

no tax on petrol...?

lol

how about the electrick bill..for light/freezers
and to run the petrol pumps and sign-age

even rates is going up
[cause of electick carbon shock]

medicine will need extra
cause their power drills use electicity

the ABSURDITY of saying toney was wrong about petrol
is a cheap shot...[obvious when 1000 became 500]

thanks again toney

@Shadow Minister: Compare it to the $50 per month. So it is 66% more expensive!

Shadow, you are behaving like an idiot.

If you got your connection from Internode you would be paying $30 for 30 Gb whether it be over ADSL or NBN. You say you get your connection from someone that is cheaper than Internode - well good for you. What does this tell us about how much your connection will be when the NBN arrives? Almost nothing, because your ISP doesn't offer it. If you are going to draw any conclusions at all, it would be they will charge you the same price for the NBN as they do for ADSL, because that is what ISP's that do offer both, Internode and iiNet, currently do.

Whether this is some because of some special honeymoon period or some other blip in the system is very hard to say at this point. I keep getting conflicting stories. Recently I came across ACMA figures that seemed to show the price Telstra is allowed to charge an ISP for a copper phone line + ADSL was actually more expensive that the $24/mo ex GST the NBN is charging. In reality comparing the two is as difficult as comparing two rival mobile phone plans - which is to say bloody near impossible.

I know you know this as we have been over it in intricate detail before, and I know you must be a bright fellow, yet argue like an idiot. This must be as obvious to you as it is to me. For gods sake, do us all a favour and argue rationally, without your blue coloured glasses on.

@one under god: its sad that rod stuart quotes numbers withiout adding in 30 buck line rental

It does include the line rental. They are both naked plans. The NBN offers no other sort.

Guys I have a different take on how many gigs for how many dollars.

Given that WE are paying $40 BILLION PLUS for this nonsense, we own it and so does the next gen of taxpayers. I am happy to pay a service fee that will cover the fixed costs of maintaining MY internet delivery company, the one I own, but that is it because I am still paying back the $40 Billion I borrowed to make it happen. Only commercial users will pay market rate for my internet service.

Silly idea goes against the business model and the principal of an investment you may think, they will not get a return on investment in a million years, they know it and I know it. I do not wish to pay for being the owner each earning week and pay for being the end-user at the end of the month; I am selling stuff to myself from a company that I am paying off.

Having said all of that who knows how much of the returns forecast in the ABN business model is earmarked towards loan repayment, ……It’s a mess, like all they touch, but our tax money will head overseas and the infrastructure that is badly needed in the growing cities of Oz will go begging, or all will be user pays, it will cost a buck to use the road to get your daily bread….stupid you say, nothing now surprises me in regard to the strange alien country I now find myself in. Where the f!#k did my country go.

@sonofgloin: Silly idea goes against the business model and the principal of an investment you may think, they will not get a return on investment in a million years, they know it and I know it.

Googling "NBN expected rate of return" gets us this, as the first hit:

"NBN Co’s expected rate of return is 7.04 per cent, which compares favourably with the average 10 year bond rate (July 2009 to November 2010) of 5.39 per cent. The NBN Corporate Plan shows the Government can expect to recover all its funding costs with interest."
http://www.minister.dbcde.gov.au/media/media_releases/2010/120

So, you are flat out wrong - they think they will get a return on their investment.

Welcome to the era of instant fact checking. Don't you love it?

Rstuart,

Either you are naive or deliberately obtuse. The fact is that in the city I can buy 6x as much data download at virtually the same speed for much less. As the NBN intends to charge all its customers the same, I see my rates increasing.

As for the payback, this is based on very optimistic take up and usage figures, and I have yet to see a Labor business plan meet any of its budget targets.

I should have the right to chose.

rstuart, check the take up rates in Tassy and in Windsor’s electorate. If you don't have the take up rate numbers are rubbish. While we are talking numbers you have a hide giving me contrived government published numbers from a report that ran over 600 pages of which they released 35, get real.

@Shadow Minister: As the NBN intends to charge all its customers the same

Indeed, but this is another furphy, as the the situation the same now with copper.

Telstra is the equivalent of the NBN for the copper network. There are a slew of different fees for accessing the copper lines depending how an ISP connects to its customer, but these fees are the same for everyone (including supposedly for Telstra retail) - just as they will be under the NBN.

The rates are set in ACMA determinations like this one:

http://www.accc.gov.au/content/item.phtml?itemId=976009&nodeId=65b3dd33f04b18f1c33a011c80d8c9a0&fn=Interim%20determination.PDF

The variations you see in ISP pricing aren't because of different access charges, but rather different business models. Some ISP's have sterling service, some don't. Some provide excellent back haul's, some don't. Some charge for upload's, some don't. Some are large, some are small. Some choose to own a lot of their equipment. Some rent it.

At the moment there seems to be a lot of thrashing about as ISP's fight with each other and the ACMA about the NBN ground rules. I don't think the ISP's know how the dust will settle yet, so you making statements about what the final pricing will be when you obviously don't have a clue about how the industry works is just preposterous. We only have one piece of evidence above and beyond the fact that the wholesale prices look roughly the same: and that is the ISP's that offer NBN and ADSL prices charge the same for both.

And here you are nonetheless claiming that when your ISP moves to the NBN, they will charge you more. Take off the blue glasses, Shadow.

Oh, and while I am here the ACMA released a report on Australia's broadband usage:

http://acma.gov.au/webwr/_assets/main/lib310665/the_internet_service_market_in_australia.pdf

In view of our recent discussions on wireless Shadow, one figure stood out in that report:

"On average, 18.8 gigabytes of data was downloaded per internet subscriber in Australia during the December quarter of 2010"

That is more data than the largest mobile wireless plan I can find.

There are of course lots of other figures in that report, none of which support your "mobile wireless will kill fixed broadband" theory.

Rstuart,

The AVERAGE is 18.8GB per quarter, or 6.3GB per month. Optus has a mobile broadband option for $39p.m. for 8GB of data, which covers 60% of all internet users, so your statement is completely wrong.

With this you can also get VoIP phone calls.

I have monitored my families monthly usage at about 50GB, and I would imagine that there are quite a few like me. This would imply that there are a significant number downloading far less than this, for which cheaper plans are available.

The NBN business plan relies on 70% take up. 65% make the NBN a money loser.

@Shadow Minister: The AVERAGE is 18.8GB per quarter, or 6.3GB per month.

That's embarrassing Shadow. I stand corrected.

@Shadow Minister: Optus has a mobile broadband option for $39p.m. for 8GB of data

A link would be helpful. But I see Vodafone has a $39 plan for 12Gb, which I guess is similar. Internode, which is one of the more expensive ISP's, has 15Gb NBN for $30. http://www.internode.on.net/residential/fibre_to_the_home/nbn_plans/

This will be 25 MB/sec versus 1/10th of the speed, and a reliable connection versus collapsing if all your neighbours use it. You continue to ignore the "laws of physics" aspect.

I have a co-worker who seeks IT's advice on his home internet. He caused much hilarity when after having built a new house and moved into it, he discovered that the ADSL check's he did at the ISP's web sites didn't mean much. So now he is using mobile wireless, using a high gain antenna and various other tricks I set up for him.

He was pleasantly surprised at the speed. I think he was expecting dialup modem speeds, so a usable internet was nice. What got him have been how unreliable it is. Dropped internet connections have already caused him double charges on his credit card. Given the companies experience with mobile internet I am buggered if I know why this was a surprise to him, but there you go.

He is now between a rock and the NBN. There is no way Telstra is going to put a RIM out near him, as any new investment in the copper network is dead money, and besides they have been relieved of their Universal Service Obligation. So sadly he is hanging out for the NBN, which sadly is years away. Maybe by that time he will be used to the limitations of wireless, and he will be a lost NBN customer.

@Shadow Minister: The NBN business plan relies on 70% take up. 65% make the NBN a money loser.

70% of who? If the prices are equal they will get almost 100% of existing fixed line broadband users. That's all they need.

Rstuart,

"This will be 25 MB/sec versus 1/10th of the speed, and a reliable connection versus collapsing if all your neighbours use it. You continue to ignore the "laws of physics" aspect."

These laws of physics didn't deter the take up of mobile phones.

The present take of broad band is about 80% of house holds. This is increasing, but the NBN needs 70% of house holds to make this viable. Mobile broad band is likely to rapidly grow cheaper as it follows the same trajectory. If the pricing comparison is similar now, what will it be in say 5 years when the NBN gets to the cities?

rstuart, I have used 3g wireless for the past 3 years, as the premises I was in were unsuitable for either cable or ADSL. I purchase data in blocks of 12GB which last for up to 12 months. The reliability is excellent, the data rate acceptable and the cost a bit steep, but entirely reasonable if one is reasonably frugal with downloads, which I have never done much of anyway.

I can see no reason why the next generation of wireless devices could not compete quite successfully with the lower speeds offered by the NBN and even some of the more ambitious ones, at a vastly lower cost to the nation, albeit reducing some of the profits to be made by the ALP's big donors

@sonofgloin: If you don't have the take up rate numbers are rubbish.

Currently they have a choice, they can continue to use the copper. That choice will disappear: it's the NBN or no fixed line.

@Antiseptic: I can see no reason why the next generation of wireless devices could not compete quite successfully

Despite Shadow addressing my "the laws of physics" argument as though it is new, it isn't. He and I have been over it in agonising detail before: http://forum.onlineopinion.com.au/thread.asp?discussion=4494#116388 and http://forum.onlineopinion.com.au/thread.asp?discussion=4494#115719

A brief summary: capacity of a wireless technology is measured using spectral efficiency. http://en.wikipedia.org/wiki/Spectral_efficiency It is measured in bits/sec per hertz of available bandwidth. So if you have a 50 MHz chunk of bandwidth and a spectral efficiency of 20 bits/sec/hz, you can transmit at 1Gbit/sec.

I didn't choose those numbers at random. 20 bits/sec/hz is just beyond the upper limit (see the wikipedia page), 50 MHz minus guard bands is what mobile carriers are allocated now, and there have been demonstrations of achieving 1Gbit/sec using larger chunks of spectrum. They need a 16 element MIMO 1/2 meter square stationary antenna to achieve it (ie not a mobile phone), but hey, they did it. In the real world that 50 MHz chunk has to be divided over adjacent cells so you only get 1/4 of it, but we are going to ignore all this and pretend you can get 1Gbit/sec per cell.

The smallest mobile phone cell is 1Km radius (in reality they're much bigger), covering 2000 houses, all of whom must share the 1Gbit/sec. So each house gets 500 kbit/sec, which is under 1/3 of what you are guaranteed to get with the worst ADSL line right now!

Thus: the laws of physics prevents a wireless NBN.

Back in the real world, we've all seen this. When too many people use mobile data, electronically its starts looking loud party in a small room with everybody yelling at each other. In other words the cell collapses, nobody hears word said, and your internet drops out until someone gives up on the bloody thing and goes to bed.

Rstuart,

Your calculations are pathetic. At 1GB/s a monthly usage is consumed in a minute. The data speeds are only used for tiny time slices, and when too many connect, it slows down. Towers have the ability to connect in cells, and pass on mobile units to other cell units.

Unless everyone is trying to download at max speed at the same time it isn't an issue. P.S. the same applies to the NBN nodes. If everyone tries to download at the same time it will also crash.

SM, you nailed it. No network is designed to be 100% available at 100% of capacity to all nodes. To do so is to build in ridiculous amounts of overhead that would be absurdly expensive and unused most of the time.

Every network suffers congestion at full cpacity, from roads to the storm water system to the NBN.

rstuart, I think you're being a little disingenuous. By comparing current technology in mobile services with the proposal for the NBN you're not comparimg apples with apples. For example, due to the poor ability of high-frequency signals to penetrate solid objects and because it's cheaper, some telcos (Optus for sure, not certain about others), are supplying customers with "femtocells" - effectively a personal mobile repreater station that can be installed inside buildings to remove "black spots". There is also the possibility of using antenna systems that are far more directional than the already quite well-focused units in use today, that could be focused down specific pathways, say roads, with femtocells relaying to a small number of houses, once again with directional antennas that direct the signal to each home and not back toward the street. These could be mounted on street light poles with little trouble.

With respect, the spectral efficiency issue is a red herring. Apart from the fact that it has increased massively thanks to advances in both manufacturing technology and the encryption algorithms used, it's only a problem if cells are too large or are poorly designed/located such that there is crosstalk between cells. As I pointed out above, that need not be the case. Further, just as today, a CAN, or City Area Network could easily use fibre in the areas of most use, such as in city buildings. The majors both operate their own CAN already and there's also PIPE.

It seems to me that the main reason for the NBN was/is as a Keynesian stimulus measure, to keep the money flowing for the large contractors who will oversee the work. I doubt it will last as long as the PSTN has.

@Antiseptic: By comparing current technology in mobile services with the proposal for the NBN you're not comparimg apples with apples.

No, I didn't do that. I thought that was pretty clear, but since it apparently it wasn't I'll spell it out in big bold letters.

On the land line on side of the equation I used 1.5M ADSL 1 technology - the stuff that existed 10 years ago. A decade old. Got it?

On the wireless side of the equation I was hopeless optimistic. I used technology that doesn't exist yet, and may never exist. 4G/5G/LTE doesn't achieve what I described. Nor does anything in the laboratory. I assumed we have stuff from the Jetson's era. Got it?

I hope so, because I thought I was pretty clear on the first time around.

@Antiseptic: There is also the possibility of using antenna systems that are far more directional

Something else you evidently missed: to get the 1Gbit/sec speed, I said they used a 16-element phased-array antenna. You obviously don't know what that is, so I will spell it out for you. It is a directional antenna that can electronically alter the direction it points in a fraction of a microsecond. You clamber on the roof and point your high gain yagi antenna at the transmitter once. These things adjust themselves in real time as trees move and cars drive past, to take advantage of changing reflections.

It's bizarre how badly you have got this wrong. It is not a case of me not taking into account directional antenna's, it is a case of using a version so advanced you haven't heard of it.

And you accuse me of using comparing old wireless technology to new land line technology. This is beyond a joke. You are trolling me, right?

@Antiseptic: With respect, the spectral efficiency issue is a red herring.

With respect, all you are saying is they can reduce the cell size. Yes, I know that can do that Antiseptic. My guess is everybody in the industry knows that, and has thought about it. Do you realise that it currently costs 10 times more to get a byte delivered through wireless, than it does via fixed line - and that includes the NBN at current pricing? Check it out - it ain't hard. Your suggestion of flooding the place with $200,000 wireless towers isn't going to help that equation. Besides, high powered radio transmitters aren't popular neighbours.

@Shadow Minister: when too many connect, it slows down.

No, when too many connect the cell collapses. This is a property shared by all broadcast networks, including the old coax ethernet. Put at lot of people on it and they don't slow down proportionately, they collapse in a storm of colliding attempts to resend data lost when it collided last time.

@Shadow Minister: At 1GB/s a monthly usage is consumed in a minute. The data speeds are only used for tiny time slices

Well spotted Shadow. Pity you didn't do some figures to see if invalidated my result. To repeat: wireless can't exceed what we have with ADSL now, thus the idea of wireless providing the next National Broadband Network is a joke.

Yes, they won't all be using it at the same time. But the ISP industry has worked out a formula to allow for that, called the contention ratio. http://en.wikipedia.org/wiki/Contention_ratio A typical contention ratio for residential is 40:1.

So we re-do the figures with a realistic contention ratio. The 1Gbit/sec with a 40:1 contention ratio provides 40 Gbit/sec, or 20 Mbit/sec to 2000 houses in minimum sized 5G/LTE cell of 1 km radius. Notice that is what ADSL can provide at a 1Km radius, without the vagaries of wireless.

Unfortunately that result is for wireless that doesn't exist, and mostly likely will never exist. Lets drop one of the assumptions that made it unrealistic: we reduce the spectrum allowance to a 1/4 to allow for overlapping cells. This is still leaves a number other hopelessly unrealistic assumptions. Even so each house can only expect 5 Mbit/sec, which is worse than what most are in fact getting now.

I don't know whether you two realise it yet, but you are teaching grandma to suck eggs. There are other hints this might be so. The opposition has stopped making noises about wireless in their attacks on the NBN. And you can read what the former CEO of Telstra has to say on the subject: http://www.theaustralian.com.au/business/media/wireless-and-fixed-broadband-tussle-is-far-from-settled/story-e6frg996-1225945853602 I am hoping that even if you continue to think I am a complete Luddite, you might allow that he will know a thing or two about the telecommunications industry.

Dear me, rstuart, you do get upset easily.

You haven't actually addressed any of the things I discussed in my post though.

I'm afraid you ARE comparing the NBN and 3g wireless, because ADLS doesn't compare at all favourably with 3g/HSDPA in tems of bitrate. If your friend is having problems, he may need to install an amplifier, as well as a high-gain antenna, simply because the signal is significantly attenuated by the atmosphere, especially if there's a fine mist of rain close to the transmitter. This is physics, as I'm sure you understand.

However, you're clearly not up to speed with developments in mobile. I refer you to wikipedia:
http://en.wikipedia.org/wiki/4G

"In telecommunications, 4G is the fourth generation of cellular wireless standards. It is a successor to the 3G and 2G families of standards. In 2009, the ITU-R organization specified the IMT-Advanced (International Mobile Telecommunications Advanced) requirements for 4G standards, setting peak speed requirements for 4G service at 100 Mbit/s for high mobility communication (such as from trains and cars) and 1 Gbit/s for low mobility communication (such as pedestrians and stationary users).[1]"

Sounds like a great deal more than 1.5Mb/s to me...

My point regarding using more directional antennas was to do with being able to confine the signal to a narrow-cast to low power microcells proximal to the user. This means that the spectrum can be used more effectively, albeit at a greater cost than the current cellular model, but hey, we're prepared to spend $43 billion, it should be easily affordable. It had nothing to do with the antenna used for the testing of the 3g tech you mentioned. I'm sorrry if this is a little more complex than "fibre good, wireless bad"...

http://delimiter.com.au/2011/07/23/enough-with-the-nbn-pricing-hysteria-already/
Shadow Minister this link is for you.
I am sure you are just as happy as I am, that you taunted me until I started to post links to prove I had been reading such.
I stand forever amazed, that any one, including your self, has any faith in anything you post.

@Antiseptic: If your friend is having problems, he may need to install an amplifier

He is using one.

@Antiseptic: setting peak speed requirements for 4G service at 100 Mbit/s for high mobility communication (such as from trains and cars) and 1 Gbit/s for low mobility communication ... Sounds like a great deal more than 1.5Mb/s to me.

Look closely at the peak figure. 1Gbit/sec. Sound familiar? I hope so - it is the one I used.

In the same article they say: "Peak link spectral efficiency of 15 bit/s/Hz in the downlink, and 6.75 bit/s/Hz in the uplink (meaning that 1 Gbit/s in the downlink should be possible over less than 67 MHz bandwidth)."

So lets see 15x67M=1005, so they do indeed get 1GHz. But only if the entire cell is devoted to 1 user. And 67MHz is larger than what is typically handed out. In Australia you only get 45MHz. Clearly an oversized cell devoted to one user bears no relationship to reality, but 1GHz looks great on sales brochures and hey, you swallowed it.

The reality bites in the next point in the Wikipedia article you link to:

"System spectral efficiency of up to 3 bit/s/Hz/cell in the downlink and 2.25 bit/s/Hz/cell for indoor usage."

Again I was being generous. I allowed for multiple cells in my previous post I divided by 4. 15/3 means I should have divided by 5.

So lets look at the figures again. 3 bits/sec/Hz/cell means a 50MHz spectrum allocation yields 150 Mbit/sec, which has to be shared by all users. A minimum 1Km cell radius (see http://en.wikipedia.org/wiki/Cellular_network#Frequency_reuse ), gives us approx 3 square kilometres. Assuming a minimum housing density of 8 hours per hectare (http://en.wikipedia.org/wiki/Medium-density_housing ) yields 2400 houses. (Recall I said 2000). Assuming a contention ratio 40:1, that means each user gets 2.5 M bits/sec.

Again I am being generous. No one is going to use a minimum size cell in a minimum density broad acre development. You might find in it a city, but its household density is 4-5 times as high, so your data rate drops to 600kbits/sec.

@Antiseptic: Dear me, rstuart, you do get upset easily.

It appears so. Intelligent people behaving like fools has that effect on me.

This wasn't so much you. I suspect you have had a good experience with wireless, and are just extrapolating this to a larger scale. Sadly wireless doesn't scale. If it did, Foxtel wouldn't have needed to build that expensive cable network, they would have sent the additional channels over the air, encrypted.

What I did above is basic engineering. It is no different to any other engineering task - you find a model, plug in the figures and out pops the answer. You will be surprised to hear it is the sort of thing engineers are called upon to do before governments commit an a $27 billion in a brand new network. You know - look into a basic things like "what would do better job - wireless or fibre", and "are we building a white elephant which will be worth nothing in a decade". I imagine the bankers that are giving them the additional $8 billion would have wanted something similar. I'm not a banker of course, so that's just a guess.

The point I am leading to is unlike you, Shadow Minister claims to be a practising Engineer. You know, one of those 4 year tertiary trained people the public spent 1000's educating. This is the person you get to crunch the figures and be ruthlessly objective - the sort of person we can and do trust to build big complex things that won't kill us.

The thing that nearly drives me to tears if you put a Labor policy in front of Shadow, he is about as objective as a 1st years arts student confronted with a GM potato.

rstuart:"But only if the entire cell is devoted to 1 user. "

One of the important points I made and in fact something that is part of the 4g specification is the use of low-power femtocells. These serve only a few users and hence their utilisation is unlikely to be anywhere near capacity for much of the time. At peak times on the exchange i'm on with my ADLS service the problem is backhaul congestion, not saturation of the PSTN link. The backhaul problem is a common factor.

There are a couple of other aspects. The first is the use of frequency-hopping and the availability of multiple channels per connection (diversity, as in 802.11n, for example), which can be dynamically switched to optimise spectrum usage. This means that the issue of leakage between cells is much less of a problem. On top of that, we're still talking about 1800MHz band, when 5.6GHz is available and entirely suitable for the short-range femtocells in question. Higher frequencies still, which have inherently more bandwidth, will no doubt be made available as well, if the model were changed from a cell of several km to one of several tens of metres.

And all that is without even considering the rapid advances being made in compression and encryption, which allow more information to be carried per packet. Yes, the same tech applies to fibre, but the overhead on a residential fibre means there's no compelling reason for it's use.

You see, I do understand that the ultimate capacity of a fibre network is greater than a broadcast network. All I'm saying is that committing to a one size fits all fibre to the premises model is needlessly expensive and will leave a huge amount of dark fibre in the ground. A multiplicity of 4G cells using narrow-cast, directed signals to communicate with relay stations that are in turn connected via fibre links would be a much more cost effective plan, it seems to me. Especially since the mobile network is going to replicate a great deal of the NBN coverage anyway.

On the subject of Foxtel, I have some experience, as well as with Optus, both of which I have contracted to. HFC was a fairly cheaply available tech that was already obsolete O/S when the rollout began. Foxtel chose to go with the cheapest option for their network, since they didn't provide critical services over it and chose a simple dendritic layout with no redundancy. Optus, since they were providing phone services and had to meet service-level commitments, installed a ring-topology network with built-in redundancy. Even so, on more than one occasion they have had both sides of a ring cut and had their network go down. Queensland was affected on one occasion and Melbourne on another. The mobile network at the time was a very crude AMPS system that was not even an option for consideration for data and simply used a 3kHz channel for plain voice. We didn't even get a GSM network here until 2000 and lets not forget that dial-up using a 28.8kb/s modem (max, 28.8) was still the norm.

As far as wireless not scaling, take a look at that spectral eficiency link you provided. Bitrate has expanded from that 3kbit/s of AMPS to the 1Gb/s of 4G and the subscriber base has similarly expanded

http://upload.wikimedia.org/wikipedia/commons/thumb/1/19/Mobile_phone_subscribers_per_100_inhabitants_1997-2007_ITU.png/250px-Mobile_phone_subscribers_per_100_inhabitants_1997-2007_ITU.png

To say wireless doesn't scale is simply not true.

I was also involved as a ham operator with packet radio on the 2m band, before there was any digital network of any kind. We counted ourselves lucky to get more than a few baud! I think there's still an active PR group in Brisbane, but I suspect they're probably concentating more on private wireless networking these days.

I'm glad you understand I'm not taking the Mick. I would have hoped to see more discussion of the pros and cons of the distribution model chosen before the rollout began. I hope that when the Gillard mob is booted, that Conroy hasn't managed to cast this in stone. It needs to be revisited.

@Antiseptic: One of the important points I made and in fact something that is part of the 4g specification is the use of low-power femtocells.

A Femtocell covers a house, maybe. (5.6GHz will be lucky to get through a couple of plaster walls.) How on earth do you think the data gets from the Femtocell to your ISP? Femtocells and their cousins use the customers land lines.

I suspect you are saying picocells could go on every pole of something. Fine. But what's the point? You end up with fibre running down every street anyway. If you put picocells on the poles, the telco has to supply power, maintain it and its battery. If you run the fibre to the home all this becomes to the customers problem and things like broken microwaves, welders, lightening aren't a problem.

@Antiseptic: rapid advances being made in compression and encryption, which allow more information to be carried per packet.

I don't know what your talking about here, and believe me I should. There have been some "advances" in encryption - principally new ciphers to cope with Moore's law. Without Moore's law DES would be still as good as it was 20 years ago, and DES3 is still robust. But encryption has _nothing_ to do with the speed data is sent.

But compression - no. Nothing.

I suspect you are getting your terminology confused with modulation and http://en.wikipedia.org/wiki/Modulation coding techniques. Yes, there have been advances. But this is not like water pump, where you can get any pressure you want by just pumping harder. Spectrum efficiency is like a sponge. There is a fixed amount of water in there, and squeezing the sponge twice as hard only gets you a little bit more. The Shannon–Hartley theorem tells us how much water is in the sponge. You can see how close we are to that limit here: http://www.wirelesse2e.com/index.php/category/lte/ We are already squeezing pretty hard, aren't we?

(cont'd....)

(....cont'd)

I don't know how long ago you were a ham radio operator, but today's radio's bear very little relationship to what a radio was 20 years ago. 20 years ago they were turners, amplifiers and what not. Nowadays the principle components are: an antenna, a digital to analogue converter and a analogue to digital converter, and a very powerful specialised computer.

The squeezing on the sponge is done by the CPU. The faster the CPU, the more complex coding we can use, the faster the data rate. So oddly the driving force behind todays better radio's is: Moore's Law. The other oddity is what is limiting this process. It's power, ie Volts x Amps. The limitations come from two avenues.

In a computer where power is unlimited, the problem is literally the CPU melting. The first 1 Gbit/sec ethernet controller ran cool, the first 10 Gbit/sec card dissipated 45 watts - roughly 1/2 the thermal limit of air cooled silicon.

In a phone the problem is somewhat different. That power must come from a battery. Nonetheless, 4G phones still run hot: http://www.anandtech.com/show/4450/lg-revolution

@Antiseptic: I hope that when the Gillard mob is booted, that Conroy hasn't managed to cast this in stone.

The Liberal currently policy is to re-negotiate the deal with Tesltra. (Labor didn't buy copper or infrastructure, just the customer base.) If that fails the fallback position is the original: kill the NBN. Since Telstra gets to keep its current monopoly if re-negotiations fail it seems likely they will.

@Antiseptic: It seems to me that the main reason for the NBN was/is as a Keynesian stimulus measure

After it is built, assuming they succeed in converting all the broadband customers (seems likely), the thing will produce a profit over and above interest payments.

@Antiseptic: I doubt it will last as long as the PSTN has.

You know something that is better than fibre? I don't.

@Antiseptic: will leave a huge amount of dark fibre

What is the problem with that? It doesn't rot, and the expensive bits are hole it lies in, and the lasers at the end.

rstuart, I'm suggesting an arrangement whereby a series of small cells (call them what you will) communicate with each other and with a local base station via directional wireless. If the cells are arranged on light poles, it is simply a matter of relaying the signal through the intervening cells to the base, where it can pick up a cable. surely you'd agree it's much cheaper to only haul cable along main roads, in large ducts that will be vastly more capacious than needed once the existing copper is removed. the rest of Telstra's network would be Telstra's problem to either leave in the ground or salvage.

5.8GHz is used for some cordless phones (inefficiently) and gives me about 100m of range from around 200mW, even through a couple of timber and plaster walls and a steel one. I'd reckon that's adequate or what I'm proposing and it could be enhanced further by the homeowner installing a suitable router Here's a proposal for the very thing. It was the first link when I googled 5.6GHz band just now.

http://focus.ti.com/docs/toolsw/folders/print/tsw5005evm.html?DCMP=hpa_rf_general&HQS=Other+IL+tsw5005evm

No, I'm not getting encryption or compression confused with modulation. I was referring specifically to the fact that compression on the fly is a trivial task these days (Moore's Law, as you say). As the largest bandwidth demand is going to come from such things as streaming video and downloading large files, this means that more useful data goes on a given piece of spectrum.

What I find most amusing in this discussion is that we're arguing the toss about something that is not at issue - the relative ultimate capacity of fibre vs wireless. Since it is extremely unlikely, I suspect, that the majority of subscribers to the NBN will pay for anything more than the cheapest package or perhaps the next one up, then the ultimate capacity of the cells I propose is unlikely to be challenged. (say) 10 subscribers at 50MB/s max is just 500Mb/s, which leaves a full 50% of even 4g bandwidth unused.

rstuart:"You know something that is better than fibre? I don't."

No, nor do I at present, but I'm also sure that there will be something that is as good or better and doesn't require a physical wave guide to make it work. The PSTN has lasted about 130 years. Do you really think that the next 130 years will see fibre unchallenged for the of distributing comms to the home? I'd have to say that was extremely optimistic.

On the subject of dark fibre, when I was with Telstra I learnt a few of the many ways in which empty or disused conduit and its contents degrades. Fibre may not rot, but it can be damaged in very many ways while in the ground. I also can't see a compelling reason to drag the cable down every street, with the cost and disruption associated, especially since the majority of the capacity will simply be unused.

I should say that I'm not at all sure of the cost of the proposals I've kited, but if it could be done at say half the cost, or if a variety of tech could be used on a fit for purpose basis, it really is a disgrace not to at least consider it.

While I'd hate to see nothing at all, or Telstra back in it's traditional place, I'm simply saying the game's not worth the candle at $43billion plus the inevitable massive cost expansion. Let's not forget that the original HFC rollout cost around 20% more than the original budget for the entire project and that was with Cable and Wireless holding the purse strings in Optus's case. I contracted to Optus during that rollout and the waste was simply staggering, as proper cost control was sacrificed for speed. I can't even hazard a guess at the additional cost of such a scheme under a Government with this one's record of mismanaging large projects, even if some other Minister were in charge.

The PR stuff was a long time ago...

Rstuart,

Your calculations are based on one antenna using one wifi frequency slot. In the 2.4GHz range there are 14 available 22MHz slots per antenna, and for the future far more available in the 2.5GHz and 3.3GHz slots etc. More low range antennas provide the same data available in smaller pockets. With future technologies, there is no reason why each antennae cannot support hundreds of slots, each with 100MB/s download capacity.

In short, most of the assumptions upon which you base your calculations are wrong. Garbage in = garbage out.

@Antiseptic: it is simply a matter of relaying the signal through the intervening cells to the base

You're describing mesh networking. I've never done it. There is one set up hobbists here in Brisbane called BrisMesh. A mesh networks theoretical capacity is surprisingly limited. As you could well imagine they have other nasty characteristics like high latency and large jitter that make them unsuitable for real time stuff like voice. I have only seen one real world application. Would you believe it's smart electrical power meters? http://en.wikipedia.org/wiki/Smart_meter

A smart meter requires an always up connection to the electricity producer. They don't want to have to insist on every customer having a working broadband connection, their density is high, and the amount of data the need to ship is small and it isn't real time. So some smart meters are wireless devices form themselves into a mesh that covers neighbourhoods, with some customers being paid a few cents to connect them to their internet routers. I thought it was brilliant.

@Antiseptic: As the largest bandwidth demand is going to come from such things as streaming video and downloading large files

All that stuff is already compressed. Try compressing a video some time. Believe it or not even web pages are compressed during transmission nowadays. There is an incentive for the large servers to do so, as it halves their bandwidth charges. And no, there are no huge improvements in compression in the pipeline.

@Antiseptic: which leaves a full 50% of even 4g bandwidth unused.

No. My 600 kbit/sec figure was optimistic for 4G as it would be deployed for mobile networks in a city. People use far more than that now. You would need to go to your picocell solution to have a hope of delivering better than ADSL. Effectively what you are suggesting is FTTN for a very small node, with the last leg wireless instead of copper. It does sound technically plausible (as in at least it doesn't break the laws of physics), but to my knowledge no one has ever done it.

(cont'd...)

rstuart:"You're describing mesh networking."

Not exactly. The upstream backhaul path through the relays/cells need not be IP-based at all, since it is inherently directional and doesn't require addressing or authentication until it hits the base. The downstream path would require addressing, but this could be done with a low-overhead, low latency distance-vector protocol, since the network topology between the relays is a simple and known one. There are no routers being added and subtracted on an unpredictable basis. IOW, the latency would be limited to that caused by the internal path between Tx and Rx in each relay. HFC already uses this method and fibre uses something similar. The relays/microcells may also be able to provide seamless handovers, but that would be a separate issue to wireless backhaul and is already part of the wishlist for the ITU.

I do understand that video streams etc are already compressed. They could be compressed more, but the limits of hardware constrain that, so as the hardware improves, the compression that can be achieved with a given latency/jitter spec does too. We've already discussed that. 4g is specified to be able to handle high-def video already.

I'm also sure that there are significant improvements to be made in compression and encoding techniques. Cryptology is a highly active field with some very bright people. I think it would be foolish to suggest that the field has already reached its pinnacular achievements.

I guess I'm suggesting a modern take on the hybridisation that produced HFC, with less fibre and no coax at all. It costs to put stuff in the ground and it costs to repair it, as well as taking considerable time. Replacing a small relay/microcell sitting on a light pole would be a trivial task by comparison and there would be no need for any third-party installation work at the premises.

I thought the smart meters injected a signal onto the power cable? Interesting nonetheless.

Thanks for the discussion, BTW. It's been a while since I've thought much on this subject

(...cont'd)

What they have done, and with the NBN will do is use wireless in low very density (rural) areas. http://www.theaustralian.com.au/australian-it/government/ericsson-seals-1bn-nbn-wireless-deal/story-fn4htb9o-1226067115500 This will be fixed wireless with dedicated capacity for each customer so it doesn't suffer from the "collapsing cell" syndrome. Ie, new towers, new infrastructure. As you can see from the link, Ericsson won the contract and it looks like it will be the first LTE network in Australia.

That probably gives us a hint as to why it isn't done. Once the density gets to a certain point, it is simply cheaper to run the fibre. In fact my guess this is exactly the calculation the NBN performing. They are obligated to provide 12 Mbit/sec to everyone, and they use the cheapest method to do so in any given situation. So they aren't really ignoring wireless. They are just using it when it makes sense to do so.

You don't want a wireless NBN connection. Or at least I would not. Unlike fibre, which as rolled out gives you up to 1G bit/sec, they are only guaranteeing 12Mbit/sec for wireless.

@Antiseptic: The PSTN has lasted about 130 years.

I didn't realise it had been 130 years. You are almost certainly right, but I doubt anything beyond 30 years matters.

@Shadow Minister: Your calculations are based on one antenna using one wifi frequency slot.

No, they don't Shadow. You obviously don't realise it, but LTE just like WiFi LTE divides the allocated spectrum chunk into a number of channels, typically 5MHz in width. In order to achieve the speeds it does LTE the bonds a number of those channels together. That 150MHz you get close to the centre of the cell is when you use all available channels simultaneously on a 67MHz spectrum allocation.

@Shadow Minister: Garbage in = garbage out.

Too true, as you have so ably demonstrated here from your very first post. In your case if you could reduce the amount of garbage in by just ignoring those Liberal press releases you seem so keen on regurgitating here.

Rstuart,

I have a degree in electrical engineering with majors in communications and field theory, (i.e. how radio and optic communication works) and am staggered at the rubbish you are posting.

Using a TCPIP 1GB/s network, it is entirely possible to be connected to 1000 people at 1GB/s, and as long as not everyone is trying to download vast amounts of data simultaneously, an intelligent network will manage, or even slow down the data transfer, giving each user an effective 1MB/s connection, while still being connected at 1GB/s.

If you look at the available frequency spectrums:

450-862, 2300-2400, 2700-2900, 3400-4200, and 4400-5000 MHz

as per

http://en.wikipedia.org/wiki/IEEE_802.11y

You will see that the total available spectrums are far higher than your posts indicate. Just at the higher spectrum there is 600MHz to play with.

Wifi is in its infancy, and to simply point at what is presently available in Australia now and to determine its limitations based on this is extremely naive.

@Antiseptic: 5.8GHz is used for some cordless phones (inefficiently) and gives me about 100m of range

The words "inefficiently" and "100m range" are two sides of the same coin. The actual throughput would be under 100 kbit/sec, the raw throughput at least 100 times that. When you only need 1 in 100 bits to make it through loosing a few because of distance doesn't matter.

@Antiseptic: the latency would be limited to that caused by the internal path between Tx and Rx in each relay.

It wasn't the routing latency I was thinking about, as you often find yourself going through 10's of routers now. It is the bit error rate. The bit error rate of fibre is 10e-10, wireless literally a million times worse than that and fluctuates wildly. http://www.scribd.com/doc/6991411/Ebook-Wireless-Implementation-Of-An-Ieee-80211-Wireless-Lan-Model-Using-Opnet I guess you could call it the cheap Chinese drill effect. Handling it over 1 hop is hard enough. Handling the cumulative effect over many hops sounds hard.

There are several ways to overcome a high BER, the one you use depends on the type of data you are sending. Voice and video must be timely, and you don't mind the odd bit of data corruption producing noise, so the usual technique is forward error correction - ie putting redundant data in the stream to recover the few bits that are normally lost, and just live with the error bursts. For computer data, like your bank statement, must either either arrive intact or not at all, and you are willing to wait. In that case you use explicit ACK's, timeouts and retries that may take forever in video terms.

So yes, you are right, you can optimise for video. But what if this is the NBN, meaning its IP everywhere and you don't know the type of data you are carrying?

@Antiseptic: I thought the smart meters injected a signal onto the power cable?

It was the idea once. Turns out making our power lines giant RF noise injectors pissed more than a few people off.

@Shadow Minister: giving each user an effective 1MB/s connection, while still being connected at 1GB/s.

For gods sake Shadow, try reading what has been said. Hint: this point has already been addressed, not once but several times.

@Shadow Minister: Just at the higher spectrum there is 600MHz to play with.

So as per the post above, 67 MHz gives us 600 kbit/sec in the city. You are claiming we have 10 times that spectrum. Righty oh, so that would mean we would get 6 Mbit/sec, still assuming unrealistic conditions. You realise that the NBN now is contracted to provide a _minimum_ of 12 Mbit/sec, and that 100 Mbit/sec plans are being offered now. That's now, not in a decade or two's time. In two decades time a 0 could easily be added to both figures without stressing the fibre they are laying now in the slightest.

@Shadow Minister: I have a degree in electrical engineering with majors in communications and field theory, (i.e. how radio and optic communication works) and am staggered at the rubbish you are posting.

If you want to be treated like an engineer start behaving like one. The working behind the all figures given has been posted. All assumptions have been referenced. If you think you have found an error just point it out, calmly and logically - like an engineer does.

Rstuart,

Your maths is out again, you left out 3 zeros.

67Megahertz bandwidth gives 600Mb/s

600Mhz gives 6Gb/s according to your method.

@Shadow Minister: Your maths is out again, you left out 3 zeros.

No Shadow I did not. It was all explained above. But never mind. You evidently don't read it, and I have decided repeating isn't is going to progress the discussion.

rstuart, I have to say I'm disappointed. The paper you referenced was in relation to the original 802.11 specification and technology has moved on a long, long way.

As a simple experiment, I took my laptop which uses 802.11n and walked away from my router while testing ping and jitter using www.pingtest.net and running a large test download, while simultaneously d/l on two other machines on the same router/link. Ping/jitter didn't increase from the 27/1 that I measured beside the router with no load until I was almost at the limit of range of the signal. As we discussed earlier, processing and discrimination have improved markedly in line with Moore's Law and developments in signal-processing.

LTE, WIMAX and of course 4G all improve on this even more.

http://www.hindawi.com/journals/jcnc/2010/628657/

The take-home message is that wireless doesn't work well at the boundaries, but hey, neither does fibre, which is why they install boosters.

I guess what I'm saying is that once again, just as with HFC, the country is going to be saddled with technology that is essentially obsolete ,for purely political rather than technical reasons, with all due respect. LTE is a kludge to extend the capacity of existing spectrum, but can still deliver 12Mb/s at 7km range and fibre will become redundant for domestic services as soon as 4G becomes available. Future developments will only further weaken the case for fibre.

I think that was made clear by the 20 year non-compete clause for wireless that Telstra had to agree to.

http://www.theaustralian.com.au/business/opinion/non-compete-clause-exposes-flaws-of-nbn/story-e6frg9k6-1226081624053

"The relevant clause in the deal is that Telstra can't promote "wireless services as a substitute for fibre-based services for 20 years"."

Once again, noone is arguing that fibre is not superior to wireless in terms of bandwidth and latency, just that it is unnecessarily expensive and overspecified. It's akin to buying this year's V8 instead of waiting till next year and buying the new hybrid. Act in haste, repent at leisure.

@Antiseptic: LTE, WIMAX and of course 4G all improve on this even more.

No. LTE gets 150 Mbit/sec near the antenna, 70 Mbit/sec average, which obviously means less than 70 Mbit/sec near the edges. That is not the picture you are trying to paint - good performance over most of the link, then a sudden drop off at the end. The real effect shown clearly by the graphs in these early Ericson trials of LTE. The speed goes down as the SNR goes down, as you would expect. http://www.ericsson.com/ericsson/corpinfo/publications/review/2008_03/files/LTE.pdf

@Antiseptic: Ping/jitter didn't increase from the 27/1 that I measured beside the router with no load until I was almost at the limit of range of the signal.

802.11n is designed to operate at its rated speed within 100m, line of sight, with 10's of people using it. Is that what you where doing? Then congratulations - it was within spec. I have had the reverse experience. I've been using 802.11n, happily with in line of sight with 20m or so of the AP. But it was within a lecture theatre with 60 other people and then the speaker suggested the room look at something online. I got disconnected.

Oh, and you know my long suffering wireless user this all started with. He has now realised while it worked real well when he first got it going late one night, it isn't always like that. He says it is possible to tell if someone is using a mobile phone in the house - but that's a minor thing. His real issue is it drops to 50Kbit/sec during peak hour. Turns out his neighbours are using the same solution.

@Antiseptic: the country is going to be saddled with technology that is essentially obsolete

Didn't you just say in a post or two ago you can't think of anything better than fibre?

@Antiseptic: unnecessarily expensive and overspecified.

Compared to what? Not doing anything? Because it is sure as hell is cheaper than wireless now. And given internet use is rising exponentially, I doubt it will be looking overspecified in a decade or two.

rstuart:"Didn't you just say in a post or two ago you can't think of anything better than fibre?"

I also said it's a question of fitness for purpose.

That's why there's that non-compete clause. Wireless is adequate for all but the most demanding domestic applications today and will become much better in the near future, let alone over the next 20 years. The only member of my household who ever complained about 3G was my son, who's a 13 year old mad keen on first person shooters.

Rstuart,

Your maths falls apart at the first hurdle:

" pretend you can get 1Gbit/sec per cell.

The smallest mobile phone cell is 1Km radius (in reality they're much bigger), covering 2000 houses, all of whom must share the 1Gbit/sec. So each house gets 500 kbit/sec, which is under 1/3 of what you are guaranteed to get with the worst ADSL line right now!"

Actually, assuming you had a 1Gb/s connection rate, the 2000 people connected would be connected at 1Gb/s. Whilst their average download rate is 500kb/s, in reality only a tiny fraction would be transferring information at anywhere near that rate, as most of the time any particular user is idle. Only if everyone tried to download at any one time would the data rate drop to 500kb/s

The most likely scenario would be that 10% are transmitting, and those doing so would get 10Mb/s. But what you mention is a fantasy connection scenario.

Using a phased array would be a waste. What would be far more efficient would be a multiple of directional antennae on a single aerial each giving 1Gb/s to a particular portion of the area.

However, the point is that wireless is not competing head to head with fixed line, as its competitive edge is that it is mobile. And for the small users, which is 50% of users this far outweighs the comparatively slower connections.

All wireless has to do is to take 25% of the connections as is presently happening in the US, and the NBN is no longer financially viable.

@Shadow Minister: Actually, assuming you had a 1Gb/s connection rate, the 2000 people connected would be connected at 1Gb/s.

OK, once more.

Because the 1Gb/s is shared by many users it is effectively a backhaul http://en.wikipedia.org/wiki/Backhaul_%28telecommunications%29 . ISP's have to provision backhaul's now, so we can apply there existing provision rules. They even have a name. It's called the contention ratio. http://en.wikipedia.org/wiki/Contention_ratio A contention ratio of 40:1 is on the high side.

So all I did was apply this existing rule of thumb to the peak cell rate. But first we need a realistic peak cell rate, and 1Gb/s ain't one. Once you have multiple overlapping cells LTE drops to 150 Mbit/sec at the centre (see http://www.theaustralian.com.au/story-fn4htb9o-1226067115500 which agrees with spectral efficiency of 3bit/s/hz/cell from http://en.wikipedia.org/wiki/4G#ITU_Requirements_and_4G_wireless_standards ), averages 70 Mbit/sec, and as that is an average it is obviously smaller still near the edges. But lets assume 150 Mbit/sec.

Another thing we need is have to get a realistic estimate for houses that 150 Mbit/sec serves. If we use the smallest cell size (1Km, from http://en.wikipedia.org/wiki/Cellular_network#Frequency_reuse ) then we are obviously in the city, where density is high. I will use the 30 houses per hectare figure Wikipedia gives for medium density in Australia http://en.wikipedia.org/wiki/Medium-density_housing . That is 9,400 houses in the cell.

So the final speed each house sees is:

150 [Mbit/sec] / 9,400 [houses] * 40 [contention ratio] = 638 k bit/sec.

@Shadow Minister: All wireless has to do is to take 25% of the connections as is presently happening in the US, and the NBN is no longer financially viable.

Indeed Shadow. But as has been point out over and over again, since fixed land usage is currently growing that doesn't look likely, and looks even less likely for the NBN as it provides a faster service than ADSL for the same money.

@Antiseptic: That's why there's that non-compete clause.

Sorry, I didn't get your point last time around. I think you are reading into it more than exists. The NBN has collectively spent some $10 billion to get themselves a monopoly. If you want fixed broadband, you have to go to the NBN - end of story. You want to read "they are scared of wireless" into that. I don't think so. They are already rolling out wireless where it suits them. If wireless suddenly got better they would roll out more of it.

What they are scared of is competition. One of the great attractions of the NBN is it looks to be a profitable venture - something the government will make money on in the long term. But as Shadow keeps pointing out, they really do need that $24/mo from every existing fixed broadband user out there in order to make that a reality. The best way to make that happen is to buy yourself a monopoly. A normal corporation could not do that, but a government can. That is why it will take a government initiative like the NBN to pull off re-wiring the country.

@Anti: Wireless is adequate for all but the most demanding domestic applications today

No, it's not. It works for you in the sticks, because there are bugger all users. The whole point of my screaming match here was to make it plain today's wireless can't handle the load in the cities.

@Antiseptic: and will become much better in the near future

No, again wrong. The figures here weren't done with todays wireless. They were done with wireless from the near future - LTE. And it still didn't work in the cities, literally by over an order of magnitude.

@Antiseptic: let alone over the next 20 years.

So this is what your argument rests on. Something new, as yet unknown technological development will render fibre obsolete. As I pointed out it is unlikely to come from wireless, as we are getting near the Shannon–Hartley limit - ie the limits imposed by laws of physics.

4g is not "as yet unknown". LTE is not 4g. 4g is specified for 100Mbps per user for users moving at relatively high speed and 1Gb/s per user for static users.

http://en.wikipedia.org/wiki/4G

"Present implementations of WiMAX and LTE are largely considered a stopgap solution that will offer a considerable boost while WiMAX 2 (based on the 802.16m spec) and LTE Advanced are finalized. Both technologies aim to reach the objectives traced by the ITU, but are still far from being implemented.[7]

The first set of 3GPP requirements on LTE Advanced was approved in June 2008.[11] LTE Advanced will be standardized in 2010 as part of the Release 10 of the 3GPP specification. LTE Advanced will be fully built on the existing LTE specification Release 10 and not be defined as a new specification series. A summary of the technologies that have been studied as the basis for LTE Advanced is included in a technical report.[12]

Current LTE and WiMAX implementations are considered pre-4G, as they don't fully comply with the planned requirements of 1 Gbit/s for stationary reception and 100 Mbit/s for mobile.

Confusion has been caused by some mobile carriers who have launched products advertised as 4G but which are actually current technologies, commonly referred to as '3.9G', which do not follow the ITU-R defined principles for 4G standards. A common argument for branding 3.9G systems as new-generation is that they use different frequency bands to 3G technologies; that they are based on a new radio-interface paradigm; and that the standards are not backwards compatible with 3G, whilst some of the standards are expected to be forwards compatible with "real" 4G technologies."

The point about competition is that it shows that the NBN is not a clearly better choice for users. Furthermore, I don't know of any "killer app" that will make it so, do you?

By the way, I wasn't in the sticks, I was at Salisbury in Brisbane. The premises were simply not serviced by cable and the ADSL service was only available from Telstra at the time I chose wireless. I did get ADSL on, but the performance was so poor that I discarded it. Telstra were basically uninterested in fixing their line.

Rstuart,

Again we are arguing at cross purposes.

Assuming your calculations are correct, there are several assumptions that are absurd:

1 All the houses in the cell are connected to wireless broad band
2 They are also all connected and on line simultaneously
3 They are all in the centre of the cell with the lowest LTE.
4 There are no other spectrum such as the 3GHz and 5GHz available

If assumptions 1 is the more likely 30%, and 2 is 50%, this already boosts the rate up to nearly 2Mb/s.

When assumption 4 fails and the other band widths are opened up, this increases 10 fold or more.

Finally, the mobile broadband is not going to cater for those that need the 1TB of download capacity at 100Mb/s, but the smaller users that make up a large portion of the user base for whom 2Mb/s with 15GB per month is more than adequate.

Even now for $30p.m. you can get mobile broadband and VoIP for little more than the existing Teltra phone connection.

@Shadow Minister: All the houses in the cell are connected to wireless broad band

Fair enough. Shall we settle whatever figure the NBN is relying on? I think it was 70% or so. That would make the above figure 900 kbit/sec.

@Shadow Minister: They are also all connected and on line simultaneously

Nope, I don't assume that, and its damned clear from what I wrote that I didn't. It's also clear you are barely skimming what I've written. That's just plain rude, Shadow.

The 40:1 contention ratio accounts for the connections. If you don't understand how, go back, click on the bloody links that define the term and find out how for pete's sake. 40:1 is high. Internode for example uses 20:1.

@Shadow Minister: They are all in the centre of the cell with the lowest LTE.

The centre of the cell has the highest speeds, not the lowest. I was being generous. I know it sounds absurd that someone in the middle of a flame war could still try to be fair to the other side and not seize on the worst case every time, but not everyone is like you Shadow. If I was being accurate I would have chosen average, which is the 70 Mbit/sec.

@Shadow Minister: There are no other spectrum such as the 3GHz and 5GHz available

Ahh yes. Wasn't that were we left off a few posts ago? You said there was a spare 600 MHz per carrier lying around somewhere, as opposed to the 67 MHz required to get the current figures. Assuming that's true, you went on to say would change my 600 kbit/sec to 6Gb/sec. Obviously not. It would give you 6 Mbit/sec, which is still under ADSL speeds. Note: 10 times the spectrum, and still under ADSL speeds!

That aside, no one in their right mind would use 5GHz. From http://ez-bridge.com/Learning_Center/learning_center.htm :

"5GHz ... requires very good line of site and long distance links can be degraded by rain and snow."

You can find a list of possible spectrum allocations here: http://www.teleca.com/Renderers/ShowMedia.ashx?id=2a8fb418-6c6d-49d5-a3b0-e22583610188 Nothing above 3.6GHz.

@Antiseptic: 1Gb/s per user for static users.

I am struggling to put it more clearly than has already been done. Try this http://www.qualcomm.com/documents/files/lte-advanced-heterogeneous-networks.pdf :

"Figure 1. Spectral Efficiency is approaching theoretical limits".

and just above that:

"Comparing the performance of 3G and its evolution to LTE, LTE does not offer anything unique to improve spectral efficiency, i.e. bps/Hz. LTE improves system performance by using wider bandwidths if the spectrum is available."

My earlier statement "We are already squeezing pretty hard, aren't we?" wasn't a joke. It was a statement of fact. The metaphorical sponge I mentioned above has been squeezed dry. We are never going to send more data over a given chunk of spectrum then I assumed.

So where is this 1Gb/s figure coming from? It assumes a large chunk of spectrum. The wikipedia article does actually say you need 67MHz for 1Gb/s, but that's a theoretical figure. It;s actually 80MHz. From http://www.qualcomm.com/documents/files/lte-advanced-key-technology-messages.pdf :

"Although most operators do not have access to 100MHz of spectrum, LTE Advanced can provide 1 Gbps peak data rates when leveraging 4x4 MIMO (and using 80MHz of spectrum)"

4x4 means a 16 element phased-array antenna. Remember me mentioning that?

Compare that 80MHz for a single cell to the current 50MHz chunk of spectrum allocated to our carriers now. The 50MHz has to be divided among adjacent cells. If we were to give 80MHz to each cell we would have to allocate the carrier 400MHz to allow for cell overlap. The one trick LTE-Advanced brings to the party is that 400 MHz of spectrum doesn't have to be continuous. It can aggregate 20 Mhz chunks of disparate spectrum.

If you are keen on understaning this the only other thing I can suggest is reading http://en.wikipedia.org/wiki/System_spectral_efficiency to gain insight into the two figures mentioned on your favourite 4G page, http://en.wikipedia.org/wiki/4G One figure is the LTE-Advanced *link* spectral efficiency of 15 bit/s/hz, and other is the LTE-Advanced *system* spectral efficiency of 3 bit/s/cell/hz. The 3 bit/s/cell/hz (it's really 2.66) is the figure you multiply the carriers spectrum allocation by to get the peak stationary data rate.

Rstuart,

You are trying to compare wireless completely replacing fixed line, which with today's technology cannot be done, and I have never tried to claim so. What I have said is that there will sufficient wireless consumers to render the estimated returns on the NBN invalid.

Wireless is by far the fastest growing broadband market, but is still less than 10% of the sole household connection market. So your estimate of 70% connected is wrong.

For the top end users, wireless cannot compete with fixed line, but for a large chunk of consumers, it can meet their needs completely. If you recall we discussed previously the various applications used compared with bandwidth required, and very little needed more than 1Mb/s. The average download pm is about 6Gb but the median is far lower, and the lowest 1/3 probably use less than 2Gb. For them the $100 pre paid annual connection knocks the NBN into a cocked hat.

In the cities the networks provide adequate coverage for the present demand, the different spectrum are available, but require upgrades to towers, and to the dongles used, and while the consumption does not require the upgrade yet, in 5 years, it will.

rstuart, we're arguing at cross-purposes and going around in circles. I'm not disputing what you say about spectral efficiency, I'm saying that the average performance of 4g per user will be adequate for all but the most demanding environments. Sure, if you've got a workplace where everybody wants to be able to video-conference at once you could usefully implement a fibre solution and many already have. I mentioned the CANs run by Optus, Telstra and PIPE in an early post.

However, if you live in a typical home with 2.5 kids, then you're simply not going to need it. What you need is a big total data allowance and a reasonably low latency. Ultimate bandwidth is less critical. We already time-shift our use for downloading and many ISPs encourage this with lower rates, just as power companies encourage usage off-peak with lower rates in order to improve the ration of baseload to peakload and hence maximise their resource use.

The LTE paper you referenced earlier also mentions that low power femtocells are the solution to spectrum saturation, allowing re-use after much less distance. I mentioned this almpost at the start of this discussion.

Just as an aside, I worked in geotechnical engineering for years, which is quite an old field and well-understood, you would think, yet advances in technology have allowed structures to be built on foundations that would have been thought impossible only a few years ago. Engineers are problem-solvers and the best ones are innovative problem-solvers. I have great confidence in their ability to drive technology in new directions you and I think impossible. The vast expansion in wireless bandwidth just since the 90s is some evidence that this is already happening.

I still can't se what the killer app is that will make fibre vital.

@Antiseptic, @Shadow Minister,

I sense I've had a bit of a win here. I think you both now acknowledge wireless with the current spectrum and current equipment allocation's can't ever replace land line. If you reduced the cell size to a hundred metres or so, and allocated 10 times the spectrum we currently do to each cell you could approach the NBN speeds they are selling now. As I said earlier, in the cities I'm certain it's just cheaper to put in the fibre and in the country were it isn't, they are using 3.9G.

So now Shadow falls back to arguments like this:

@Shadow Minister: So your estimate of 70% connected is wrong.

The 70% figure is the NBN's estimate, which I concede I didn't look up. It wasn't worth it as your wireless arguments needed 0's, not a couple of %.

However, as repeatedly pointed out, it doesn't matter. To make a profit the NBN just needs to convert existing fixed line broad customers. You noisily point to the phenomenal rise in the number of wireless "broadband connections" as though it means people are dropping fixed line. What you refuse to concede is it doesn't, and we know it doesn't because fix line subscriptions are rising too. What is actually happening is are getting itsy bitsy data allowance with their shiny new iPhone's, and these are counted as broadband connections.

Finally Shadow, I suspect I sucked you into believing that the NBN's plans may end up being more expensive. What I said was true, but reality is we don't know yet. There is an almighty sh1t fight going on over NBN wholesale pricing right now, some of it in public http://delimiter.com.au/2011/07/21/pulling-apart-the-nbns-untenable-pricing-model-by-simon-hackett/ . This is situation normal for telecom industry. The ACCC has been presiding similar sh1t fights between the incumbent monopolist, Telstra, and is customers for years.

I suggest you stop leading with your chin like you did in the first post on this thread until the dust settles. Sadly that will probably take years, bureaucracies and politics being what they are.

@Antiseptic: I'm saying that the average performance of 4g per user will be adequate for all but the most demanding environments ... I still can't se what the killer app is that will make fibre vital.

And this is the argument you fall back to Anti. It's an odd argument. You were very keen to pin the future of the NBN on the tenuous indeed idea of huge gains in wireless. But now you are pinning your argument against the NBN on there being no similar gains in internet usage, even though we are installing the technology to make such gains possible. It's even odder when you concede you are already time shifting your usage, which you would not be doing if data wasn't becoming a scarce resource.

The other odd thing is internet usage is growing exponentially. In other words what you say won't happen has been happening since the internet began, and is happening as we speak. From http://www.livinginternet.com/i/ip_growth.htm :

"The Internet is growing exponentially in three different directions -- size, processing power, and software sophistication -- making it the fastest growing technology humankind has ever created"

In the face of that the argument that internet usage now going to suddenly stop growing is almost impossible to accept. The nice thing about the NBN is we are re-writing the country with the one technology that can cope with this of growth for decades. Wireless simply can't. Even if given huge chunks of spectrum and tiny cells, it tops out at roughly where the NBN is starting.

Obviously I think the NBN is an inspired piece of nation building. I was listening the the chairman of the ACCC saying who we have to thank for this. He said it was Sol Trujillo and Phil Burgess, because they so undermined public opinion of Telstra the government could shaft them. To that list I would add Howard. He sold off Telstra, which meant Telstra shareholders had to wear the write-off of the copper network. There is no way the government would have treated an asset they owned so cavalierly.

rstuart, I've ever argued that fibre was not the superior technology, I've always argued the fitness for purpose issue. As I said, I think we've been arguing at cross-purposes.

The point about time-shifting was that this is what the next generation technologies do within data streams to achieve best median performance for all users. At present, a lot of the time the spectrum is effectively idle and simply maintaining a carrier to the receiver to keep the connection alive. If this idle time can be used to send packets on that frequency to other receivers then the net data rate effectively increases.

Improvements in switching and development of the algorithms to manage it have allowed this to be a reality to be transparent to the user and barely impact latency. It's intersting that LTE advanced also incorporates some of the relay functionality that I was discussing earlier. Once the full 4g spec is implemented there will be a lot of develop in that area as well as distributed phased arrays, in which many stations can be directed to create a very localised hot-spot, rather than a beam per se.

On the issue of increasing internet use, you seem to be trying to have two bob each-way. you discount the effects of development of wireless tech as not important enough to bother with, then cite some unspecified reason for expecting bandwidth demand to increase exponentially.

I'll keep asking the question: what's the killer app that's going to drive that?

Rstuart,

A flash of insight? "I sense I've had a bit of a win here. I think you both now acknowledge wireless with the current spectrum and current equipment allocation's can't ever replace land line."

The only problem is that none of us ever claimed that they could, or even should.

85-90% of the cost of the NBN policy is not upgrading the heavy lifting centre to centre fibre, or fibre to the kerb, but simply the cost of fibre from the kerb to every household. I would compare the NBN fibre as the Porsche of the networking world, and the NBN policy is to deliver a "Porsche" to every house hold, and while that might be popular now, when the time comes for every house hold to pay for the "Porsche" there will be a problem.

If you recall from a previous conversation, the statistics on internet usage at the present. Roughly 80% of house holds have broad band, 10% dial up, and 10% have no internet connection at all. The NBN needs to get 70% of households to sign up the the NBN internet until about 2030 years to get 7% return on investment.

The whole economic model of the NBN is that it will shut down all other competition such as copper, and has paid Telstra and Optus not to compete with wireless. However, with the wireless technology expanding in leaps and bounds, largely driven by the huge appetite in the USA for wireless, the odds that competition in the form of wireless will eat the NBN's bread and butter are very good.

The other major danger to NBN co is that a new government will simply strip away its protection from competition, and it will collapse into yet another testament to Labor's financial incompetence.

@Antiseptic: I'll keep asking the question: what's the killer app that's going to drive that?

Sorry Anti, I didn't answer that because I thought it was rhetorical. If I knew what it was, I would be Australia's next billionaire. But I am not even sure there will be one. Internet usage is growing exponentially now without a killer app. But then most things (eg smartphone's) do.

The only "killer app" I can recall is VisiCalc. It was released before the original IBM PC, and died long before PC's became a common household item. It "only" sold 700,000 copies, a tiny number by today's standards, and thus has very little to do with the explosion of PC's it triggered. People found all sorts of uses for them, once they became affordable. In fact I can't actually remember when I last used a spreadsheet at home.

So if you are picking the killer app for the internet, it was the thing that got it into the mainstream. I'd say that was the original static web page browser. It was only good for browsing text, because HTTP/0.9 only defined the HTTP GET verb - it had no POST. We've moved well beyond that of course. Just like the PC, once it got it's kick start it has been put to all sorts of uses.

By the way, did you know it looks like online shopping in the UK in June grew 24% over last year? http://www.theregister.co.uk/2011/07/21/ons_retail_sales/ I only qualified it with "looks like" because the 24% includes all non-store sales, like catalogues - but it is more likely catalogues are dropping rather than rising.

@Shadow Minister: However, with the wireless technology expanding in leaps and bounds, largely driven by the huge appetite in the USA for wireless, the odds that competition in the form of wireless will eat the NBN's bread and butter are very good.

And you think this despite knowing despite the US's huge appetite for wireless, land line installations are still growing there. I don't there is anything more I can add, Shadow.

"And you think this despite knowing despite the US's huge appetite for wireless, land line installations are still growing there. I don't there is anything more I can add, Shadow."

Try:

"The volume of mobile data traffic!from!tablets, smartphones, laptops, and other wireless!broadband devices!is!growing at an exorbitant rate.
Cisco estimates the volume of US mobile data will grow 21 fold between 2010 and 2015, for a compound annual growth rate (CAGR) of 83%. By 2015, US mobile data traffic will reach 914.6 million gigabits (or nearly an exabyte) per month – equivalent to sending 229 million DVDs over the Internet each month. Data traffic on AT&T’s mobile network is up 5,000% over the past three years, a compound annual growth rate of 268%"

http://www.hightechspectrumcoalition.org/PDF_SpectrumCrunch_OnePager_FINAL.pdf

The comparison between copper lines and mobile phones is similar. Note that the copper business is now shrinking. Fibre is the better version of copper faster, but still fixed.

The world needs a better mouse trap.

rstuart, the killer apps that drove rapid internet uptake and especially the demand for bandwidth in the last 10-15 years include online games, multimedia streaming, movie and music downloads.

Video conferencing has been a bit of a dud, but it will improve no doubt, although I'm not sure that it will become a major domestic app.

That was the point I was making: if there is no compelling new reason for bandwith demand to be increased by 3 orders of magnitude, then why are we bothering to increase capacity by that much? If a road planner said we need to expand the notoriously busy Hume Highway to 2000 lanes each way, don't you think somebody might question the need?

Distribution networks need to be as big as they need to be and no bigger, otherwise there is waste. If they are 1000 times bigger than they need to be there becomes a major incentive for the people employed to try to justify the waste and that leads to misinformation and bad decisions. Labor are treating this whole thing the same way they treated the railways until they managed to sell them off and the axe was then taken to all the fat in the system - with complete disdain for the genuine needs of the community. Look at the state of Australia's national rail infrastructure today to see the result.

What puzzles me in this whole process is that with the exception of the technically-literate Turnbull, there has been almost no genuine consideration of alternatives.

Ask yourself why Telstra was prepared to be left dangling on the end of a purely mobile network, ditto Optus...

@Antiseptic: That was the point I was making: if there is no compelling new reason for bandwith demand to be increased by 3 orders of magnitude, then why are we bothering to increase capacity by that much?

We aren't laying down a network that will be here for the short period Antiseptic can foresee. One hopes we will still be using this fibre at the end of this century. At the beginning of last century horses were the main form of transport. I bet they didn't foresee not getting wireless broadband while flying at 1000 km/hr at 10,000m being a major irritant. Methinks your vision is similarly limited.

@Antiseptic: Look at the state of Australia's national rail infrastructure today

You've lost me. I don't know enough about rail to know what you are talking about. The only recent government decisions I think were an appalling waste of money here in Queensland were Newman's new river crossings which have literally send billions down the tubes in the space of a few years. His is a Liberal of course. Unlike you seem to be doing here, I don't use the performance to characterise all Liberals.

@Antiseptic: What puzzles me in this whole process is that with the exception of ... Turnbull, there has been almost no genuine consideration of alternatives.

There was Anti. Do you remember how both governments, both Liberal and the Labor, tried to go down the path of negotiating with Telstra and Optus to build a new network? Both failed. Do you remember what the Liberals "broadband plan" was at the last election? It was to give a bucket of money to Telstra to build yet more infrastructure. Ie they were _giving_ money to a private monopoly to aid and abet extending that monopoly. Now I think about it, it sounds a lot like Abbott's carbon plan.

So the reason we are getting the NBN is not purely technical. It costs us less in the long term to rip out the entire network and replace it than it would to bribe the entrenched monopoly to upgrade the existing one.

@Shadow Minister: The volume of mobile data...is growing at an exorbitant rate.

That is a sales prediction and it might be a wee bit optimistic. Still there is no denying your basic point - wireless is growing very, very quickly. I still don't think it is relevant if broadband installations are growing at the same time, which they are. And that is fundamentally being driven by the fact that a byte delivered over a fixed line costs 1/10 of the same byte being delivered over wireless, and I can't see that changing.

@Shadow Minister: The world needs a better mouse trap.

Oddly I was chatting about what I now see is a similar thing over the weekend. One of the things that drives the internet is its charging model. The chap I was speaking to wanted a new charging model with the NBN. He wanted to be able to walk anywhere, connected to the local NBN using whatever means offered, eg ethernet or wireless, and have his account charged for the data. I thought he was nuts at the time, particularly as the NBN, being a local loop provider, has to be charged on a physical connection basis. But now that I think about it, it would be technically possible to layer such a structure over the NBN. The NBN already has the major element in placed needed to support this: charging for bit/s, not bytes.

That is just the sort of mouse trap that fix the wireless bandwidth problem. If you could somehow let anybody connect to a wireless access point you put in and collect a few cents per gigabyte the used the place would soon be blanketed with tiny wireless cells of the sort Anti envisaging. It would break the current wireless cartel (Vodafone, Telstra, Optus) wide open. You would need the NBN as a back haul of course.

@Shadow Minister, @Antiseptic,

This what happens when a wireless network gets overloaded and goes into its failure mode - which is total collapse as opposed to just slowing down like a fixed like does. It ain't pretty:

http://delimiter.com.au/2011/07/26/customers-continue-to-desert-vodafone/

So because Telstra and Optus didn't want to build yet another wasted network because they think wireless is the most likely path to future growth at best cost/benefit, that somehow makes fibre more important? Not sure if I agree with that sort of reasoning.

You seem to be saying in regards to need - correct me if I'm wrong - "build it and they will come". I'm happy to be convinced on that, all I'm asking is what might drive it. Even pie-in-the-sky stuff, after all this is 1000 times our present capacity you're advocating. I simply can't see it.

The rail analogy was to do with the way the railroads were run as a massively overspecified and hence overcost transport medium. Because they were featherbedded by every new Minister to assure Union support in the party room, they got fatter and fatter, despite carrying little more traffic because trucks were more flexible and cheaper. Although they couldn't carry as much as a train, most people didn't need a trainload of stuff transported and they did need it where they were, not where the train went to.

As a result they suffered a dramatic loss in funding and they were allowed to wither, while the areas that really needed rail, like mines and broadacre cropping largely got done by private enterprise.

http://en.wikipedia.org/wiki/Australian_National_Railways_Commission

Rstuart,

http://www.onlineopinion.com.au/view.asp?article=10838&page=0

This was published last year, and does not even consider broadband. But what it does show is that whilst a small number of users will be in the position to use this capacity, the vast majority are going to see very little additional benefit. Having the nbn is like having a porsche in suburbia. It is nice to have, but with 60k limits, it is functionally no different to any other car.

Much of the ASDL copper and cable network is in good condition and delivers fast broad band. As 10% of the cost is the backhaul network and 90% is the fibre to the house, massive savings could be made simply by installing the fibre to the house when either the existing copper network degrades, or when the customer wishes to upgrade to a super fast system.

As for "And that is fundamentally being driven by the fact that a byte delivered over a fixed line costs 1/10 of the same byte being delivered over wireless, and I can't see that changing."

Unfortunately this is not true with the NBN, as the vast majority of the cost is recovery of the capital expenditure. Which is why the low end packages don't differ significantly from existing wireless offerings.

@Antiseptic: Not sure if I agree with that sort of reasoning.

I'm not sure if that is how it happened. The incumbents were perfectly happy to build a new network on government money - if they got exclusive access to it.

@Antiseptic: You seem to be saying in regards to need - correct me if I'm wrong - "build it and they will come".

Not really, because they are already there. The NBN only need to transfer the existing users to make its 7% return.

It will happen like this: one day your ISP will ring you and say: "Sir, the NBN has now passed your house. Would like like to switch over? The price will be the same (hopefully), but it will be faster. If you don't do it now, then in 18 months your house will be disconnected from the land line network, and it will cost you $300/$600 (not sure which) to get it connected". What do you reckon your answer will be?

@Antiseptic: The rail analogy

Not a bad analogy. Continuing the analogy, the only difference I can spot is the NBN is replacing existing rail network, with a faster and more reliable one, and it only needs to carry the same freight as was on the original network to make money. Seems like a much safer bet to me.

@Shadow Minister: Much of the ASDL copper and cable network is in good condition and delivers fast broad band.

I think the average is around 3 Mbit/sec Shadow, which is not my definition of fast. The NBN raises that to 12 Mbit/sec, minimum. Still not "fast", but getting there.

As we have been over before the sticking point with the copper was Telstra owns it. If you upgraded it you would either have to purchase it as a working system for far more than they did, or pay Telstra to upgrade it. Instead they got away with a trick - we will pay you $9 billion for your customers, and be grateful because after this your network is worth nothing anyway. We have been over this. FTTN wasn't ruled out by technology. It was ruled out by monopolies, self interest, and politics. In the end they matter just as much as politics.

@Shadow Minister: Which is why the low end packages don't differ significantly from existing wireless offerings.

But are currently identical to Naked, and I imagine phone + internet offerings. If you think wireless is the same standard as fixed line we are going to have to agree to disagree. One is uneven speed and is unreliable. The other "just works".

rstuart:"it will happen like this"

yes, I know that, what we're discussing is whether, if it didn't "happen like this" I or anyone else would choose it. I say no, so you say "yah boo sux to you, you can cop it sweet, who cares what you think".

I hardly think that's an approach that's going to lead to the best decision, do you? Really?

In fact, it seems to me that you can't actually provide a reason for the NBN at all.

Telstra and Optus are not known as soft-headed organisations. They bet on winners if they can. Why would they be prepared to give up a duopoly (effectively a monopoly) on fixed line? Why would they pin their corporate future on wireless? Are their technical people simply dumber than Mr Conroy? Are their beancounters a bit dimmer than Mr Swan?

The rail analogy is very apposite, because it is almost a directly parallel situation. An established but inefficient network was bypassed by a more responsive and efficient one.

rstuart, this is what I mean about new technology

http://www.newscientist.com/article/mg21128225.400-will-lifi-be-the-new-wifi.html

"Visible light communication (VLC) uses rapid pulses of light to transmit information wirelessly. Now it may be ready to compete with conventional Wi-Fi."

Remember I mentioned that it seemed likely that the need for the wave-guides that are fibres will disappear?

"There are around 14 billion light bulbs worldwide, they just need to be replaced with LED ones that transmit data," says Haas. "We reckon VLC is a factor of ten cheaper than Wi-Fi."

Tying ourselves down to FTTH does the nation no favours, it merely gives the NBN a legislated monopoly on something that will be dead as a tech for domestic connectivity before it's even completed.

@Antiseptic: "Visible light communication (VLC) uses rapid pulses of light to transmit information wirelessly. Now it may be ready to compete with conventional Wi-Fi."

For pete's sake Antiseptic they are talking about visible light. You aren't seriously suggesting a frequency that can be stopped dead by a 0.1mm sheet of paper as something we use outside are you? Well if so you are not alone. http://www.metrocom.net.au/laser_links.htm I've avoid them myself. Like most people, my uses for them don't go away when it rains.

Here try this - 7Gbit/s, not long away from being a shipping product: http://en.wikipedia.org/wiki/Wireless_Gigabit_Alliance Looks impressive, doesn't it? For the life of me, I can't see how it will be useful. The signal is stopped dead by a wall or cabinet. Probably glass as well. They try to get around that by using phased array antenna to pick up on the reflections, but by all reports you need network of then around the house just like your VLC thingy. As you should have picked up from the figures given here, give a 5GHz WiFi access point a 200 MHz block of spectrum and is should be able to push 1GHz fairly easily, and that won't be interrupted by the dog wandering by.

Why you even bring up such technology is beyond me. It is barely useful in a room. It will never, ever be useful for bring data to a neighbourhood. Unless of course you put your light signal in a glass wave guide - now you are talking.

@Antiseptic: In fact, it seems to me that you can't actually provide a reason for the NBN at all.

Oh, you don't know the reason behind it? The average speed in Australia is 2.6 Mbit/sec. http://www.itwire.com/it-policy-news/government-tech-policy/40744-australia-bombs-at-50th-for-internet-speeds They want to give everyone a minimum 12 Mbit/sec, and provide everyone in the country with the opportunity to get things like HD Foxtel, not just those in the capital cities.

There were going to use FTTN to do this, but that didn't work out for business reasons. It just so happens that fibre does work out.

Rstuart,

As per this article, there is no application other than live HD TV that requires more than 1Mb/s. That the average connection in Australia is 3Mb/s would indicate that for the vast majority, the upgrade to the NBN at best a nice to have. It also indicates that a significant number get far more. I for example get 8Mb/s with no problem. On the same contract that initially gave me 500k. As the back bone was upgraded, so was my capacity at no cost.

The restrictions are presently more to do with the major trunk cables between nodes, and the limitations here. This can be resolved by spending 10% of the NBN's budget, and for $4bn upgrade the average to close to 8Mb/s. At this point there is no need to price gouge the customers, and the cost of broad band will drop. Higher speeds can come with 24month contracts that include the cost of the fibre to the home, much as mobile phone contracts do today.

rstuart there are very many frequencies that aren't visible and simple line of sight is all that is required, especially if there is a diverity of routers. It's just like fibre, but without the fibre and I'm sure the next few years will see fantastic development. They're already seeing 500MBytes/sec (yes, bytes) they say and that's pre-first generation. Back in 99 when you had a V90 modem did you seriously think that we'd be discussing this? why do you find it so hard to imagine the next logical step could be as huge and as rapid?

Let's face it, if fibre was a commercially feasible project in its own right it would not need to be done this way - as a shonky monopoly that has to rely on non-compete clauses to even pretend to be viable. Someone would have snapped it up, so why didn't they?

Remember, Telstra and Optus have 20 years of non-compete, do you reckon they'll be sitting idle and leaving all that infrastructure as 3g/LTE? What about the other players? What about new ones, commercial and otherwise who want to set up local wireless access points using the one connection to the NBN, in a sort of adhoc implementation of wireless distribution? I reckon I could be happy with a 100Mbps feed shared with 7 others via a decent router and there'd be no reason users couldn't rout on to their own wireless subnet. But the NBN just lost 7 customers out of a potential 8. Telstra/optus etc still get their mobile service dollars though. Lose/win for NBN vs the telcos.

Here's a nice little piece

http://www.news.com.au/technology/what-the-hells-a-femtocell-in-short-it-fixes-mobile-coverage-blackspots-in-your-home/story-e6frfro0-1226104197035

Mr Williams said that while the femtocell device solved mobile phone reception problems in the home, it was not an alternative to fixing poor coverage areas.

"Over the next year we're deploying 700 base stations across Australia and in the past three years or so we've invested $1.6 billion in infrastructure and installed 660 odd base stations," he said.

Telecommunications analyst Foad Fadaghi told news.com.au Australians should be aware that any femtocells sold now may need upgrades in the future.

"The terms of the deal are 24 months, and over the course of the next 24 months most of the carriers will be launching LTE or next generation 4G networks," he said.

"Consumers have to be conscious that they might need to upgrade these devices down the track as well, think about that in the context of going into 24 month contracts."

So even within 24 months Optus is forecasting this generation of the femtocell technology to be obsolete, because they're also talking 4g and did you see that data allowance?

All this and the NBN has barely got past trials.

@Shadow Minister: As per this article, there is no application other than live HD TV that requires more than 1Mb/s.

Then I disagree with the article. Pictures on web pages are often over 1MB(ytes). Flash on web pages are often over 1MB. Doing a google image search on "barbie" downloaded over 1MB on my link. Displaying my wife's facebook page downloaded over 1MB. Each of these things happened relatively quickly on my link, as within a second or so. That's comfortable. Waiting 10 to 12 seconds for a web page to display is not.

You may say it doesn't matter. But it does. That under 1 second wait as opposed to a 10 to 12 second wait is what makes web applications like Microsoft Live Mail, GMail, and Google Apps, Google search suggestions and so on usable. If they start pausing or connections become intermittent they become much less attractive.

Let me put it another way Shadow. The hardware advances you electronic engineers consistently made over a 30 year period are nothing short of a miracle. You've outrun every other profession except one, but they are the only one that matters. The software guys have been able to use everything you have given them, and still want more.

@Shadow Minister: This can be resolved by spending 10% of the NBN's budget, and for $4bn upgrade the average to close to 8Mb/s.

Indeed. And both the Liberal and Labor governments tried to do that. What you keep ignoring is neither managed to make it happen. The incumbent Telco's were too intransigent. You keep banging about the technical side as though that the only consideration that matters. It isn't. We ended up where we are largely because of logistical and business considerations, not technical.

Where we are isn't so bad. It's probably better for the tax payer in the long term than paying the incumbents to upgrade their networks. The downside is the increased risk. One part of that risk, takeup, has been neatly sidestepped assuming they keep the price the same. That leaves building it on budget - fingers crossed.

@Antiseptic: why do you find it so hard to imagine the next logical step could be as huge and as rapid?

May be because using visible light as your carrier isn't a logical step for outdoor transmission, given there is the ruddy great noise generator called the Sun in the sky? Maybe because there are a whole pile of reasons nobody goes much above 5GHz for anything other than point to point?

@Antiseptic: most of the carriers will be launching LTE or next generation 4G networks,

It was you I went through 4G figures with on this thread, right? Or are we just have this discussion pretending those figures don't exist?

Let me spell out the conclusions just in case you've forgotten already. In order to supply what the NBN is supply _now_, we would have to do a few things:

- Roll out 3.9G.
- Up the spectrum available to the telco's by a factor of 10.
- Design, and manufacture carrier grade picocells capable lasting for decades when installed outdoors on a pole (current ones are indoor only, because no telco in their right mind would deploy something reaching so few customers).
- Come up with a 16 element phase array antenna that is actually capable of surviving on a pole.
- Install said picocells and antenna at roughly 200m centres across the country.
- Get everyone to install a phase array antenna on their roof.

Or of course they could just use fibre we are running down the street to service those picocells anyway, which is potentially 1000's of times faster and more reliable.

@Antiseptic: did you see that data allowance

Err Anti, that 500Gb allowance was on his land line. The femtocell uses his land line to send data back to Optus. He was saying he was in the fortunate position of not having to care how much data the femtocell used, because of the prodigious data allowance on his land line. Its not so prodigious really. TPG sells unlimited data for $60/mo, although at a horrible contention ratio that makes it unusable for a femtocell.

rstuart, light has been used as a medium for outdoor transmission since Roman times and probably before. They used heliostats and signal fires, but I think the technology might have moved on a little.

Light, especially coherent light, propagates well in air and scattering is only a problem over great distances. The tech that is being tested doesn't even do any modulation of the carrier except switching it on and off. In radio terms it's straight CW, just like morse code on shortwave in the early days of radio. How far do you reckon you'd be able to see a blinking light?

rstuart, the point about the data allowance is that even for the chap in question, it was way bigger than he needed. So much bigger than an extra bit of traffic was not worth worrying about. That was on current tech. Why on earth do we need 1000 times more bandwidth when we can't use what we've already got? That is the question you keep dodging and it's the central one.

It's precisely that sort of blinkered approach that has saddled us with the white elephant that will be the NBN.

Your argument comes down to "it's happening, so there" and a reliance on the capacity of 3g for comparison and even there the NBN has trouble holding its own on the basis of genuine need.

As I said, do you also advocate a 2000 lane National Highway Network? Look at how much traffic it can carry! Think of the possibilities!

Let's make a little wager. I'll bet you that in 10 years you'll be using a wireless device for 50% of your internet activity and probably more, since it will be the cheapest option. I'll also bet that you'll not have any genuine use for the massive pipe into your home and it could be easily replaced with a 4g service without you noticing. That's even if the NBN has actually managed to go past your door by that stage.

BTW, the NBN isn't supplying much "now" at all. It will in a few years.

Here's another piece of new tech that makes the NBN look sick using a distributed model, much as I suggested earlier.

http://www.theaustralian.com.au/national-affairs/wireless-challenge-to-future-proof-nbn/story-fn59niix-1226104623595

In a paper released yesterday, Mr Perlman claims his new wireless technology breaks Shannon's Law, a fundamental theorem of communications that posits all users on a wireless network must share bandwidth.

This means that, on conventional wireless networks, download and upload speeds fall as more users are added to the network. But with DIDO that principle is turned on its head.

"We know we can get to 100-fold what today's cellular systems provide, and we are optimistic we can get to 1000-fold," Mr Perlman said in a recent talk at Columbia University, where he first publicly described the DIDO system.

His paper states: "The potential of DIDO is to have unlimited numbers of simultaneous users, all streaming high-definition video, utilising the same spectrum that a single user would use with conventional wireless technology, with no degradation in performance, no dead zones, no interference between users and no reduction in data rate as more users are added.""

The more I see, the more it looks like you're just not up to speed with developments.

There were always 2 types of engineers: those who see problems as challenges for the creation of something genuinely new and those who "know what can't be done". In geotechnical engineering, the latter build bridges for Main Roads using standard designs, while the former work out how to make buildings stand up in places where buildings "can't be built". Unfortunately, the NBN is the product of the Main Roads types.

I'm beginning to grasp the problem I have in discussing a vision that isn't written down in a standard spec. You "know what can't be done"...

To save you the trouble, here a link to the Perlman paper. He's already built prototypes.

http://www.rearden.com/DIDO/DIDO_White_Paper_110727.pdf

Rstuart,

I truncated my throughput on my modem to 1Mb/s, and guess what, For most of the time, the difference was only slight. I measured the size of my Facebook page and it was 1.03MB, and while it took about 10s to load, most of it was not on my screen, but several screens below. The result was still that my initial screen loaded in a couple of seconds.

But my comment was that there is no application other than HDTV that requires more than 1Mb/s, and you have failed to show otherwise.

That the government has in your words neatly sidestepped the risk of take up by destroying the existing infrastructure and banning alternatives is only true, for 2 reasons:

1 Wireless can easily take away enough customers to make the NBN unprofitable, and
2 The NBN is going to need 2 decades of enforced monopoly, and the Labor government is not likely to exist for that long.

http://www.theaustralian.com.au/business/in-depth/nbn-pricing-model-angers-small-providers/story-e6frgaif-1226104582891

Now try and tell me how fair it is.

Even Conroy's crew couldn't come up with anything approaching a domestic need.

http://www.theaustralian.com.au/business/in-depth/broadband-network-has-41-only-customers-at-test-sites/story-e6frgaif-1226104601174

"The federal government pointed to the benefits of the superfast network, such as patients in remote locations being able to be seen by doctors via webcam link-ups. The network also allows for businesses to move outside the major cities."

So hospitals and some businesses might need it, but where's the need for homes to be connected? Further, why am I going to pay for something that some other type of business might require? I could do with a new forklift and a new panel saw would be great. Some $3500 that could be put toward those things I need is instead going to be taken away from me and used for something someone else might need at some indeterminate point in the future, if there's no competition and no technological advances.

Great.

@Antiseptic: In a paper released yesterday, Mr Perlman claims his new wireless technology breaks Shannon's Law

Yes, I saw that. I thought it was sad to see an intelligent man like Malcolm Turnbull be dragged down to the level of Joh Bjelke-Petersen in the Hydrogen car fiasco, where he put state money into a nuclear power car, or perhaps a perpetual motion machine. I never did figure out quite how it was meant to work. Anyway, the measure of a successful scammer is now many suckers he reels in. Mr Perlman seems to have pulled in a few, including you. More power to him.

@Shadow, a comment from a electrical engineer who majored in comms on the likelihood of someone breaking Shannon's Law would be handy right about now.

@Shadow Minister: I truncated my throughput on my modem to 1Mb/s, and guess what, For most of the time, the difference was only slight.

I'm actually impressed Shadow. That piece of objective experimentation is far more than some of your other comments lead me to believe you would bother with. I'll comment once I get around to being as object as you were, and repeating your experiment.

@Shadow Minister: Now try and tell me how fair it is.

I posted a precursor to that article when I said: "There is an almighty sh1t fight going on over NBN wholesale pricing right now, some of it in public http://delimiter.com.au/2011/07/21/pulling-apart-the-nbns-untenable-pricing-model-by-simon-hackett/ . This is situation normal for telecom industry. The ACCC has been presiding similar sh1t fights...for years."

The article you link to is mostly a beat up. If you read the article I linked to, you will see this isn't entirely the NBN's doing. It was the ACCC, who raised the POI's from 14 (7+7 backups) to 121. That decision favoured large Telco's over smaller ones like Internode, and the little ISP's are fighting this for all they are worth. Right now the dust is still in the air, and the feathers are still flying. Commenting on pricing before it settles down is unwise.

rstuart: "Mr Perlman seems to have pulled in a few, including you"

I'm certainly prepared to be convinced. You seem to be certain that you "know what can't be done". I'm sure you were equally certain that Cu pairs "can't carry high frequencies" and that "HFC is the network of the future".

Unfortunately, I can see it's a waste of time continuing this discussion, you're only intereested in hearing one thing:"fibre good, wireless useless" and you simply won't dicuss anything else. You don't happen to work for NBN Co do you?

Rstuart,

There are plenty of ways of increasing the flow of information beyond shannon's law, and they involve differentiating the signal. For example, the issue of band width is a major issue with satellites, as it is the single biggest bottleneck in their capacity.

For example, the same bandwidth can be used, for two data streams by using rotational antennae, one which emits a wave with left hand rotation and one with right hand rotation. Similarly polarisation can differentiate between two signals, (as used with 3D films) and finally, very directional antennae can cover different areas.

As for DIDO, I must admit some scepticism of the claims I saw in the paper, but without details I simply cannot comment.

However, with regards my comments on 1Mb/s bandwidth, if the 3G system is presently capable of 3Mb/s, a large section of present users would find no justification for paying a premium for the 12Mb/s of the NBN.

When 4G and 5G are rolled out with their vastly increased bandwith and data transfer rates, the NBN will have serious competition.

@: you're only intereested in hearing one thing:"fibre good, wireless useless"

No Anti, like everyone else who owns a smart phone I use wireless when a land line isn't available. In fact it is invaluable in my line of work. I look after critical infrastructure (or at least that is what my employer deems it to be), and I always carry a means getting to it.

Wireless can never offer what the NBN could offer in raw speed or quantity. I don't think there can be any dispute about that. There is also no argument smallish amounts of speed and quantity wireless can do it cheaper than fibre. Even the NBN uses wireless where the amount of data they have to deliver over a given land area (I guess you could measure it is bit/s/m^2) is small enough.

Thus the _only_ dispute is where the cross-over applies.

@Shadow Minister: but without details I simply cannot comment.

Just like everyone else on the planet, it seems.

@Shadow Minister: For example, the same bandwidth can be used, for two data streams by using rotational antennae, one which emits a wave with left hand rotation and one with right hand rotation.

A neat trick, but it doesn't break Shannon's law. if you are using polarisation it becomes part of the signal level. It can at best double it.

@Shadow Minister: very directional antennae can cover different areas.

They can. But again that doesn't break Shannon's law either. A series of high speed microwave links using parabolic antenna don't break Shannon's law any more than sending the same signal over a really fat noisy copper wire the same width as the beam does. The only thing it does is reduce wireless's annoying habit of your super strong signal becoming everyone else's noise.

The problem is none of these things have a much of an effect on the peak link spectral efficiency. That is measured when you are standing close to the tower, where beam forming gets you nothing because you are already close and there isn't any spatial diversity to take advantage of.

Rstuart,

For the user that wants high speed and 1TB of download, landline will always win over wireless, however, for the small user for whom 1Mb/s speed and a couple of GB per month is their only consumption, the starting packages for NBN are far too expensive.

Why pay a minimum of $60p.m. when wireless at $20pm meets your needs. That it is also portable is another plus that the NBN cannot match. With the cost per house hold about $6000 to install, irrespective of the package, the NBN needs lots of money from lots of people to be viable.

rstuart:"Wireless can never offer what the NBN could offer in raw speed or quantity."

And trucks can never offer what trains could offer in sheer capacity and efficiency. When was the last time you had a train deliver a load to your place?

@Shadow Minister: Why pay a minimum of $60p.m. when wireless at $20pm meets your needs.

Indeed shadow.

Did you notice that from http://acma.gov.au/webwr/_assets/main/lib310665/the_internet_service_market_in_australia.pdf the total downloads (gigabytes) rose by 50% from 2009 to 2010? 54% was increase was over fixed lines. 19% over Mobile Wireless Broadband.

I'll grant you if those those download figures freeze at 2010 levels my back of the envelope calculations show the NBN will be in trouble, as with investment of the same order that is being poured into the NBN wireless + advancing technology could cope. If it keeps growing by 50% per year on the other hand, it doesn't have a hope.

rstuart:"If it keeps growing by 50% per year"

And what is going to drive such an uptake? The driver to date has been increased interconnectivity and the ability to download content. Is the nature of either of those things going to change so rapidly?

And all that is quite aside from the issue of emerging technologies, doing things which you "know can't be done".

You haven't convinced me, I'm afraid. I think you're in love with the concept of having a big pipe going into your home, but how much bandwidth do you really use?

I'm not thrilled to be paying so you can be thrilled with your toy.

@Antiseptic: And what is going to drive such an uptake? The driver to date has been increased interconnectivity and the ability to download content.

I agree it's an interesting question, but an indication of how hard it is to answer is neither you not I know what is driving it now. It isn't increased connectivity - it only grew by 10% or so. People have always had the ability to download. If what is driving the ability to download in increased internet speeds - then guess what, that is what the NBN is going them.

@Antiseptic: I'm not thrilled to be paying so you can be thrilled with your toy.

So what do you think you will be paying?

Rstuart,

Also note fig 2 pg 14, where fixed line connections increased only slightly, and mobile wireless broad band connections doubled in 18 months to rival the No of fixed line connections.

Just have a look at this link with regards the exponential growth in wireless overseas, and the future trends, both in cost and speed. Then tell me that the fixed price recovery of the NBN is not going to be a huge problem for the viability of the NBN.

http://www.scribd.com/doc/50642393/6/Mobile-Broadband-Cost-and-Capacity-Trends

rstuart:"It isn't increased connectivity - it only grew by 10% or so."
The increase in the size of data allowances, the increased use of video content and the growth in content provision has been large. However, there's only so much content that one can watch. Unless some new mode of interaction comes along that uses much more bandwidth, I can't see that growth continuing, can you?

It would be an interesting calculation to perform to work out just how much total data per household is being consumed at present. the palns have grown masively, but has the traffic done the same? I don't think I've ever maxed out my allowance, except when I was buying data in 2GB blocks on 3g at one stage.

rstuart:"So what do you think you will be paying?"

At $43billion without the blowout factor I:'ll be paying, along with every other taxpayer, about $3500 or so. It'll probably end up nearer to $5000. Would I install an internet connection for myself if it was going to cost me that much? Not a chance. Would you?

@Antiseptic: At $43billion without the blowout factor I:'ll be paying, along with every other taxpayer, about $3500 or so

And so we go around the circle once again. How many times have we been over this now?

For a start the "real" price is I think is around $50 billion, or which $23 billion of that comes from private sources. The remaining $27 billion is coming from the tax payer, which is I guess about $2,700 per household.

However that $2,700 will generate a positive return over and above what the government pays in interest on government bonds. That return is supposedly generated by charging existing users what they are paying now for broadband. So this is not like road, hospitals, schools where the government doesn't get a return on your tax dollars. In fact if the our previous governments used all our tax dollars to make investments like this they would not be charging us tax - they would be paying us a dividend.

There are undeniably a risks just like there is with any new venture. Shadow views those risks as high, I low. But nonetheless taken on figures treasury(?) has produced, saying _you_ will be for the NBN out of your tax dollars is stretching things a bit.

@Shadow Minister: mobile wireless broad band connections doubled in 18 months

@rstuart: What is actually happening is are getting itsy bitsy data allowance with their shiny new iPhone's, and these are counted as broadband connections.

@Shadow Minister: Just have a look at this link with regards the exponential growth in wireless overseas,

They are projected figures pulled from someone's bum. The wireless providers here in Oz struggling to cope with 20% growth, while fixed line is growing at 50% paints a different picture.

I tried to dig up some meaningful figures, like the trends for average US or even better Korean downloads/connection/year, so we could compare to where Australia is now. Frustratingly I haven't been able to find anything. Everyone seems to be obsessed with number of connections and connection speeds, not total downloads.

@rstuart: I tried to dig up some meaningful figures, like the trends for average US or even better Korean downloads/connection/year, so we could compare to where Australia is now.

Ahh, finally found something, although I would not trust it overly. http://www.broadbandreports.com/forum/r25970193-Canadians-average-13.7-GB-bandwidth-per-month . If we continue at 50% growth per year it will take us 7 years to hit where South Korea is now.

I wonder what those South Korean's are doing with all that data Anti? I don't pretend to know. I just know it's likely they aren't that much different to us, apart from them having a high speed network now, of course.

Rstuart,

Don't you read your own links, the information under Fig 2 is:

Mobile wireless broadband includes services provided via dongles, datacards and USB modems. Excludes mobile handset internet.
Relates to ISPs with 1,000 or more subscribers. Includes household, business and government sectors.

NOT as you claim: " itsy bitsy data allowance with their shiny new iPhone's, and these are counted as broadband connections."

If you extrapolate, the number of mobile broad band connections probably already exceeds the fixed line connections. While presently many of these are complimentary to fixed line, as the wireless capacities ramp up, many of them will replace fixed line connections as they have in the USA.

Secondly, Which private sources are funding the $23bn. The returns are so low and the risk so high that no one in his right mind would touch it with a barge pole.

@Shadow Minister: NOT as you claim: "itsy bitsy data allowance with their shiny new iPhone's, and these are counted as broadband connections."

The constant growth you are harping on about is in connections. That would be Mobile Phone Handset data bundles, which grew by 66% in one year. They downloaded an average of 4029 [TBytes/q] / 3.1 [Musers] users / 3 [month/q] = 433 MBytes/month. You are right in saying they are well on their way to exceeding fixed line users. But the characterisation of their downloads as itsy bitsy sounds about right.

There are also the mobile broadband users. These are the ones you are claiming are going to undermine the NBN. We don't know how they are growing in numbers (last years column has "n/a"), but we know their data usage grew in total by 19% - ie not much. Their downloads were 16990 [TBytes/q] / 3.7 [Musers] / 3 [mo/q] = 1.5 [MBytes/month].

The bottom line is for all your bluster, nowhere on the planet is wireless displacing fixed line - even in your precious US. Yet that is what must happen for the NBN to not make money. Surely you must concede it isn't the easiest position for others accept.

@Shadow Minister: Secondly, Which private sources are funding the $23bn

I don't have a clue. Maybe next years NBNCo annual report might say?

Rstuart,

You didn't even bother to look did you. It excluded mobile handsets. This may be Itsy bitsy, but is also irrelevant to what I was talking about.

"Internet subscribers by technology type.

Growth in internet subscribers in Australia continues to be dominated by mobile wireless broadband (dongle, datacard and USB modem based services), which increased by 49 per cent in the 12 months to December 2010. However, the increase in mobile wireless broadband subscriber numbers has not been at the expense of mainstream fixed-line services with ADSL subscribers (covering all copper based access technologies relating to DSL, ADSL and ADSL2+) increasing by approximately seven per cent during the same period. Mobile wireless broadband has continued to gain in popularity such that subscriber numbers are now marginally below ADSL subscriber numbers (see Figure 2). At the end of December 2010, ADSL accounted for 43 per cent of all internet subscribers in Australia marginally down from 44 per cent at the end of June 2010. In comparison, mobile wireless broadband subscribers accounted for 40 per cent of all internet subscribers, up from 36 per cent at the end of June 2010."

The figures you so blithely quote are for broadband including wireless.

"Figure 21 Volume of data downloaded via fixed-line and mobile wireless internet services"

As I said previously, many of these connections are complementary to fixed, line, but in 5 years when the NBN is starting to be available in the city, the data and speed offerings of wireless will start to make the $60 p.m. base offer for the NBN look obsolete.

@Shadow Minister: You didn't even bother to look did you.

Touché. I only looked at the tables and graphs.

Fair 'nuff,

I haven't done so much reading for ages.

@Shadow Minister: I haven't done so much reading for ages.

Me neither. Without your prodding I would know no more about the NBN than the next guy.

That DIDO thing - I gather it only works if the number of transmitting antenna's is at least equal to the number of receiving antenna's, and all transmitting antenna's are connected by a fast backbone, and signal strength and phase shift for seen by each receiver from every transmitter is known to within a small fraction of the wavelength. They also have to be uncorrelated (which in fairness the chances are high).

The transmitters then coordinate, adjusting the signal strength and phase so that their combined signals at each receiver add up to what they want the receiver to see. It works because they have N variables they can adjust (the transmitters), and can thus solve for the N results they want to achieve. So it doesn't break Shannon's law and it deployed it would allow the system spectral efficiency to equal the link spectral efficiency (currently the system spectral efficiency is a factor or 6 below the link spectral efficiency). I'll leave it to you to decide how practical it might be.

rstuart:"That DIDO thing"

But the principle of using constructive interference to create an emergent signal at a specific point is lovely, don't you think? I also can't really see a huge problem in having transmitters almost ubiquitously using direct optical links for the backbone and some suitable radio frequencies for the local stuff. Triangulating the receivers woiuld be trivial and the transmitters would be in a well-known absolute position.

Sound-field processors have done this more or less sucessfully for ages, but the missing link has always been the ability to know the location of the receivers, the ears.

W.r.t. DIDO,

Phased arrays and GPSs get very close to the accuracy req. I would imagine that the computing power required would be tremendous.

However, it does show that there are ways around today's supposed limits.

My original point though was that spending all this money without the desire in the market to pay for it is reckless and would not be tolerated in any private company. Labor's solution is to try and eliminated the competition. Given the strides that wireless is taking, this might only be partially possible.

SM:"I would imagine that the computing power required would be tremendous. "

Undoubtedly, which is why he proposes having it done at the centre. I really like the idea of encoding separate transforms on the signal for each transmitter. Rstuart seems to have missed the way in this makes it possible to break Shannon's law: the modulation is effectively "virtual", in that it isn't encoded on any one carrier, but is an emergent property of the signal that is processed within the receiver. The wireless itself never gets close to encoding the amount of data that was first encrypted, just a small fraction. It would even be possible, I imagine, to have the signal built up from individual components rather than having to coordinate all the phase-shifted signals arriving at once.

The more I think about it, the more I reckon he's really onto something important.

@Shadow Minister: Phased arrays and GPSs get very close to the accuracy req.

Nah, it would have to be in the cm range, GPS is 1000 times worse. But I imagine the towers sending out a sync signal and the receivers reporting what they saw could be made to work. The towers would have to synchronise their transmissions within the picosecond range. Effectively what you are doing is turning the mobile network into a sub-centimetre terrestrial GPS network.

For someone walking the tower's would need to accurately and collectively decide on their position every 100 milliseconds or so to keep within the required fraction of a wavelength range, which I imagine is impossible. So this is fixed wireless only. But since it is fixed the convolution matrices can be prepared ahead of time, and if you can distribute the effort across the towers you might keep the computational effort tractable.

Bad multipath interference would cause havoc with DIDO just like as does with GPS because the changing signal strengths on the various path's makes fixed look like mobile.

The data links between the towers would have to be enormous because every tower if sending at 1Gbit/s every tower would have to know what every other tower is sending, meaning if 6 towers are visible to a receiver all those towers would have to see each others traffic. Then they have to negotiate sending times and strengths. 100 Gbit/s would cover it the typical 6 towers that see each others signals. Doing this for 100's of towers is obviously a fool's errand.

So given the computational requirements and bandwidth requirements, doing this in a single data centre even for a city like Brisbane as suggested in the DIDO paper isn't possible. It only scales if you distribute it across the towers, but my guess he currently doesn't have have the algorithms to do that.

If he does manage to pull it off in a decades or two's time the pay back is a 6 fold improvement in the system spectral efficiency of the downlink, and no improvement on the uplink.

@Antiseptic: Rstuart seems to have missed the way in this makes it possible to break Shannon's law: the modulation is effectively "virtual"

Once again Anti: you can't break the Shannon-Hartley theorem. It isn't a law. A law is a physical model for the Universe that has been confirmed through repeated observation. This is a mathematical theorem. Assuming the workings are correct it can't be wrong.

Think of it like this. The area of a piece of land is Length x Width. This is mathematical statement of fact, just like the Shannon-Hartley theorem. An architect can then come along and build a multi storey block of flats on that block of land. That doesn't mean Length x Width has been broken.

So Shannon tells us how much you can send within a given Signal To Noise ratio. The peak link spectral efficiency of 4G (ie where they get 1Gbit/s/hz) assumes a SNR of 20db, which is pretty high for wireless. In fact its pretty good in general. Even on HFC a SNR of 30db is considered acceptable, on DSL the 20db is considered OK. HFC is shielded from background noise. Wireless isn't.

So - Shannon's law can't be broken, and single 4G link is already assumes an SNR close to the limits of what background noise will allow. That doesn't leave a lot of wriggle room. I guess reducing the cell size effectively is the equivalent of building multi story blocks of flats. The current 6 fold loss for system spectral efficiency does look juicy and that is what DIDO is targeting. But to put it into perspective, reducing the cell radius from say 5km to 200m would achieve a factor of 600.

The theorem is being broken because the data is being encoded on multiple streams and decoded within the receiver. No individual signal is carrying all of the data.

Further, because the data is encoded as a custom waveform at the central processor then reduced to components than can be modulated satisfactorily the total data rate is not dependent on the modulation, but on the initial pre-processing. It's effectively a very clever form of compression. The S/N doesn't really come into the equation at all, since the final data is a composite of lots of different sources, meaning error correction is trivial.

As for the location business, it's simple triangulation. Any body with a Yagi has been able to do it forever. It's trivial for a distributed phased-array with lots of elements and even with only a few elements the error would be down to the limits of the timing system.

I'm sure there are lots more clever tricks yet to come. I have no idea what can't be done.

Rstuart,

As a matter of interest GPS is capable of sub cm accuracy. However, as most of the GPS satellites are US, there is a random signal mixed in to prevent them being used for cheap missile guidance for non friendly countries.

Survey systems can get accurate readings, they just need to average over a few minutes.

US weapons such as cruise missiles have access to the clean signal and can fly a missile through an open window.

@Shadow Minister: Survey systems can get accurate readings, they just need to average over a few minutes.

I always thought they achieved the accuracy through terrestrial augmentation, so I went and looked it up.

Turns out the GPS manufacturers were naughty and figured out a way to use what was supposed to be the military only L2 signal to correct for unpredictable delays in the ionosphere. A "few" minutes is a wee bit off - it takes 45 minutes, and the accuracy is around the 60 cm level. This unit is typical: http://www.resourcesupplyllc.com/pdfs/SXBlueGPS_RSLLC.pdf

If all you want to do is measure the distance between two points, then using two GPS's positioned at the two points and chatting to each other works because they both see the same ionosphere delays. You then get millimetre accuracy for the relative distance between the two points, but it takes an hour. I presume the absolute accuracy remains at the 60cm level: http://www.icsm.gov.au/mapping/surveying4.html

1mm relative accuracy would be good enough I think, but your box needs a good view of the sky, the towers still have to be involved, and if your strongest signal is a reflection rather than line of sight it still isn't going to give you the answer you need. I think you would be better off just measuring the real delay from the towers.

Rstuart,

You are right, I must have confused my units between metres and cm.

"Relative Kinematic Positioning (RKP) is another approach for a precise GPS-based positioning system. In this approach, determination of range signal can be resolved to a precision of less than 10 centimeters (4 in). "

However, most of this error is due to atmospheric distortion. Not a problem experienced in wireless cells.

NBN Co's attempts to gouge retailers has suffered a setback.

http://www.theaustralian.com.au/australian-it/backlash-forces-nbn-rebates/story-e6frgakx-1226111965800

AN industry backlash against the NBN Co for how it charges internet providers for usage of the $36 billion fibre network has forced the company to change its controversial pricing model and revise parts of its corporate plan.

@Shadow Minister: NBN Co's attempts to gouge retailers has suffered a setback.

Ye gods - even for the Australian that is an over the top headline. Ah but when I look I see they didn't say anything like that, did they Shadow? The truth was a little humdrum perhaps? Felt compelled to tart it up a bit did we? Shame.

That aside, do you remember this?

@rstuart: There is an almighty sh1t fight going on over NBN wholesale pricing right now, some of it in public http://delimiter.com.au/2011/07/21/pulling-apart-the-nbns-untenable-pricing-model-by-simon-hackett/ . This is situation normal for telecom industry. The ACCC has been presiding similar sh1t fights between the incumbent monopolist, Telstra, and is customers for years.

You've managed to dredge up a something I mentioned two weeks ago.

I am not sure Hackett has a good point, but nonetheless the NBN has moved a little. Well, a tiny bit actually. All they did was introduce a honeymoon period - the NBN won't start charging an ISP at a POI until they have a few paying customers to connected to it. Hackett has already said this isn't enough. Surprise, surprise.

As I said, situation normal. An equivalent sh1t fight currently going on the traditional copper arena would be this:

http://www.itwire.com/it-industry-news/strategy/48453-telstra-price-squeeze-hackett-slams-accc-inaction

I guarantee you will got nuts with tedium if you keep following the internal machinations of the ISP industry at this level.

"It is not a charge based on real costs; Rather, the quantum of this charge has simply been chosen to fill in an otherwise huge hole in the Federal Government policy requirement that the network return funds to the Commonwealth at a commercial rate and in a short timeframe (relative to the expected lifetime of the network). "

A prime example of a monopoly wholesaler gouging the retailers. This would not be possible if the alternative copper lines were maintained, and the customers had a choice.

It is just like the Sydney tunnels, where in order to get traffic through the tolls, the alternative routes were closed off.

Ralph Norris, the outgoing chief executive of the Commonwealth Bank, joined the criticism of the NBN, saying governments did not have a strong track record of operating commercial ventures. "I've never been a great fan of government's running commercial or business entities," he told The Australian. "What ends up happening is that they end up getting run on a non-commercial basis."

@Shadow Minister: A prime example of a monopoly wholesaler gouging the retailers. This would not be possible if the alternative copper lines were maintained, and the customers had a choice.

Firstly Shadow you're just spraying bs - you don't have a clue whether it's gouging or whether they are just making that promised 7% return on the tax payers investment. That latter could hardly be called gouging.

@Shadow Minister: It is just like the Sydney tunnels, where in order to get traffic through the tolls, the alternative routes were closed off.

More bs. You don't know that either. If the pricing ends up being the same as Telstra is charging Internode for ADSL then in fact you are wrong. Right now, what Internode is paying the NBN for fibre access is _cheaper_ that what Telstra is charging Internode for copper access. Internode is charging $40/mo for 5Gb/mo for lines it has to rent of Telstra (ex phone) or $60/mo (inc phone line - ie NBN equivalent) http://www.internode.on.net/residential/adsl_broadband/easy_reach/ , vs $60/mo for 30Gb/mo NBN. Now that indisputably is gouging from a privatised monopoly supplier - a monster created by the Liberals.

You continue to refuse to acknowledge this problem. If the Liberals had of followed the same policy for the road system they would have sold every bloody road in the country to a single monopoly provider. You are whining about what happens when the occasional isolated tunnel is run as a profit making business - charging whatever the market will bear. Can you imagine what it would be like if every god damn road was run like that?

Well you don't have to look to far, as that is what the Liberals created when they privatised the copper monopoly. If the ACMA didn't intervene regularly $40 for 5Gb would be the least of it. And yet that is apparently what you want.

TPG Has broadband for $9.99 per month over the phone charges for 20GB. The NBN cannot compete with this.

That the NBN is "only recovering its costs" does not mean that it is not gouging the retailers. If it had to compete, it would be forced to make a loss, if it has the license to recover its costs, and not competition, it has no incentive to reduce its costs, and happily passes them on to the customer.

"More bs. You don't know that either. If the pricing ends up being the same as Telstra is charging Internode for ADSL then in fact you are wrong. Right now, what Internode is paying the NBN for fibre access is _cheaper_ that what Telstra is charging Internode for copper access" Wrong.

Yes I do know it. Why else demolish the existing network, pay telstra and optus not to compete via wireless, and put in legislation to prevent others from building competing networks.

The reason government monopolies are broken up is precisely because there no competition and no incentive to reduce costs or innovate. The NBN is already corporate dinosaur, and cannot compete without protection from the real world.

The real test would be if the ALP removed the competition and the NBN could compete. Otherwise the claim that the NBN is value for money is Bullsh1t.

SM "The real test would be if the ALP removed the competition and the NBN could compete. Otherwise the claim that the NBN is value for money is Bullsh1t."

ALP Remove competition?

I think you need to check your statement

I want the "competition" to be free to compete on a level playing field.... no NBN monopoly -

and then we will see what a fraud this ALP shrine to the great God "Nation Building" is

I still think there would be competetive value in a wireless/cable hybrid

of course, that some farmer in the back of Bourke cannot count his cattle via internet video might be a problem but if he really wants to do that, he is free to pay the economic price for it....

I dont see why ordinary city based citizens should subsidize his technological fiobles

@Shadow Minister: TPG Has broadband for $9.99 per month over the phone charges for 20GB. The NBN cannot compete with this.

We are clutching at straws aren't we? It isn't $9.99. It's $29.99 with land line rental. Oddly enough, I can't see too many people being worried by loosing it. They can get cheaper plans with mobile wireless. The 20Gb isn't real, as I am sure you have figured out.

@Shadow Minister: The reason government monopolies are broken up is precisely because there no competition and no incentive to reduce costs or innovate.

Absolutely. Which is why it is a pity when the Liberals sold Telstra they didn't take the opportunity to break it up. Because then they would have achieved something. But no, they got greedy over the sale price, and turned a public monopoly into something far worse - a privately owned one.

To be fair breaking up a land line telecommunications monopoly is damned near impossible because that particular market tends to naturally form monopolies. Nonetheless your summation of the private monopoly that was created is spot on - it didn't reduce costs or innovate.

And so now that mistake is being rectified. The private monopoly is now being turned back into a public one. Oddly enough to do they very thing you say a government owed monopoly won't do - innovate. It's amazing how you manage to get it arse about.

@Shadow Minister: The real test would be if the ALP removed the competition and the NBN could compete.

Pity the Liberals failed at that same test when they had their stab at reorganising the industry.

@Shadow Minister: pay telstra and optus not to compete via wireless

Maybe they asked for that, but both you and I know it's an impossible ask. There are loopholes big enough to drive a truckload of tethered smartphones through. The payment was for fixed internet. There will be competition from wireless - as you have pointed out over, and over, and over again.

Telstra was a state funded monopoly, and should have been broken up.

The NBN is simply repeating the mistake of decades ago by building Telstra 2

A government owned monopoly is no way better than a privately owned one. With the break up of Telstra, and the different technologies available, there is a chance for the first time of delivering communications by different competitors on different platforms. Juliar simply wants one platform and to ban all competitors.

@Shadow Minister: Telstra was a state funded monopoly, and should have been broken up.

Breaking up a natural monopoly doesn't work Shadow. The US tried it when they broke up the AT&T. When they ended up with is a whole pile of smaller regional monopolies. The net effect was to introduce a little at the edges of the networks where the baby bells touch.

Sp what they ended up with was the phone company, and the cable company. These private companies don't allow others to access their network. Several companies are tried to rollout fixed wireless, but the capital costs are just too great. This comment is typical: http://www.anandtech.com/show/4574/clearwire-makes-lte-advanced-plans-official#cid196786 The end result is in the US typically you have two land line ISP's you can choose from. Compare that to our situation. We accept there will be a natural land line monopoly, but we regulate it heavily forcing it to offer the same price to all retailers.

As you know Shadow you have a huge choice of ISP's all fighting tooth and nail to get your business. Which do you think serves us best?

I know what I prefer, and the bottom line that is what both sides are delivering. Neither are proposing to break the monopoly on the land lines. The Liberals put the monopoly in private hands, then heavily regulated it - to the point of setting prices a private company could change for the goods they were selling. You talk about private companies innovating, but what incentive is there to invest money under those conditions?

It is reasonable to question whether the upgrading the telecom land line infrastructure to fibre is necessary. But if you are going to do it, I don't see any other way of doing it than the NBN. Expecting or asking Telstra to upgrade the copper network under the current circumstances is just kidding yourself, or asking to be ripped off. Being charged a rip off price is what happened when they did ask.

rstuart, that link doesn't say anything about "fixed wireless" being too expensive. It does, however, make mention of the use of TDD, which you may recall I mentioned way back at the start of this thread.

The only mention of finances is in the comments and seems to be from a disgruntled customer. I'm sure Telstra and/or Optus could tell him all about those...

You might also like this piece from the Fairafx press

http://www.brisbanetimes.com.au/national/treasury-had-early-concerns-about-nbn-papers-show-20110812-1iqwf.html

"Previously secret documents, made public yesterday, also reveal Treasury told the government it would have to consider shielding the $36 billion network from private-sector rivals to help make it viable."

Who'd have thunk it? Well, actually, everybody apart from you and Conroy, apparently. Oh yeah, Quigley quite likes his gig too...

Rstuart,

What makes you think a public monopoly is in any way better than a private regulated monopoly? A private monopoly cannot ban others from competing with it, and has the motive to reduce costs.

Secondly, private companies could upgrade each customer to fibre based on the needs / spend desire of the customer on a user pays rather than everyone pays basis. This could have a small subsidy, but is likely to reach those that want it faster than the NBN, even though the total roll out will be slower.

On the subject of "why do we need it" this seems relevant

http://www.itwire.com/opinion-and-analysis/cornered/49136-to-believe-we-need-100mbps-you-have-to-have-some-vision?start=1

It says:"And it was asked again to a panel of IT industry luminaries on Tuesday at a Trans-Tasman Business Circle lunch in Sydney this week: "What are some of the ideas coming into your minds as to what you will be able to use that kind of capacity for once it is available on a broad basis."

As with so many of the 'answers' to this question,' not one member of the panel was able to come up with a convincing application that really needed that kind of bandwidth. All the applications mentioned could easily be supported with widespread availability of the kind of bandwidths available on today's networks."

As I said...

And here's another comment on the topic of the necessity of having fibre-level bandwidth.

http://delimiter.com.au/2011/08/20/in-defence-of-turnbulls%E2%80%99-nbn-speed-claims/

"Those blinded by Labor’s glitzy NBN vision need to rub their eyes for a second and realise that Malcolm Turnbull knows what he is talking about when he says there are few consumer applications which require the kinds of 100Mbps speeds which the fibre network will provide."

and
"Now, I’m not going to argue with the fact that all of the technology required for all of this videoconferencing — as much as ten HD streams from one house! – is available today. After all, vendors like Cisco and Polycom already offer high-quality videoconferencing gear for business, and in the consumer sphere there are a range of suppliers selling decent kit as well.

But what I do want to raise is the fact that it might not require quite the level of bandwidth which Stilgherrian claims it does – and also the idea that despite it being available, so far most Australians have shown absolutely no interest in actually using it.

In his article on The Drum, Stilgherrian never actually goes into what bandwidth level each of the HD videoconferencing applications he describes requires. However, in a previous article published by Technology Spectator, he does. And it quickly racks up. Let’s go through his list of what could be a typical household:

The geologist mother: Remote mine viewing (2 X 5Mbps), plus 3D manipulation of rock strata (10Mbps), plus a videoconferencing session with her boss (5Mbps)
The HR manager father: Videoconferencing with his PA (10Mbps, plus a possible further 10Mbps for passing handwritten notes)
The student son working on homework with friends (10Mbps)
Daughter streaming video online (5Mbps)
Another family member’s doctor’s appointment (10Mbps)
Security camera monitoring (10Mbps)

Hmm. With a sum total of 80Mbps of capacity being used in the vision outlined here, it’s not hard to see why some people believe that the sooner we get the NBN, the better. The only problem, of course, is that all of this is complete horseshit of the highest magnitude."

I agree.

There's an excellent book called "Decision-making on mega-projects: cost-benefit analysis, planning and innovation" which gives an excellent summation of the way in which projects like the NBN go off the rails from the start and suffer from poor analysis of the justifications for commencing.

Below is a link to what the authors say are the 6 reasons for this occurring. It do believe they're especially relevant to the way the NBN case has been mishandled.

http://books.google.com/books?id=tenILJ-MowQC&lpg=PP1&dq=isbn%3A9781845427375&pg=PA2#v=onepage&q&f=false

@Antiseptic: I agree.

Firstly it isn't a choice between 100MBit/s and something else. It is a choice between 100Mbit/s and doing nothing. I agree that upgrading the copper network would make most sense. Unfortunately that path has been tested twice by both sides of politics, and has failed twice. Given both sides of politics acknowledge the network has to be upgraded what path do you suggest should be taken, if not the NBN.

Secondly the argument "we are spending too much to build something that people can't pay for and won't use" only makes sense if in fact they can't pay for it and won't use it. But since people are using data, and what they are building will make a profit at what they are currently paying it's a non-sequitur. Yes, the system might have extra capacity household's won't use. Why is that a problem?

Stilgherrian's predictions of what data will be used in the future, and yours for that matter, remind me of this Henry Ford quote:

"If I had of asked my customers what they wanted, they would have said faster horses."

By the way, in Tasi there are already NBN users with 100Mbit/s, who complained when they didn't get it. Several of them in fact. It is through their experience with them the NBN now says the minimum back haul is 200Mbit/s, because it turns out when you put 2 100Mbit/s on a single 100Mbit/s they whinge, normal industry contention ratio's be dammed. http://delimiter.com.au/2011/07/21/pulling-apart-the-nbns-untenable-pricing-model-by-simon-hackett/

rstuart:"It is a choice between 100Mbit/s and doing nothing."

Not at all. It's a choice between an expensive and over-specified technology that will not be even close to fully utilised or a cheaper technology that can be easily scaled.

Remember the subject of "Li-Fi" - light-based wireless networking? Here's a link to an interview with a developer of the technology. Have a listen, it's only a few minutes long.

He says they have achieved speeds of 100Mb/s and can do much more. It is not affected by external light sources, since it uses a form of amplitude modulation (AM) and noise is not a large problem, since most noise sources are constant brightness or change on timescales that are not relevant to the signal and can hence be easliy filtered. If you've evr flown a plane you'd have used a noise-cancelling headset which uses the same principle to allow you to hear relatively low-vooume voices over the very loud noise of the engines.

The more I look into this the more convined I am that the NBN is no more than a very expensive boondoggle. Anyone want to bet that when Conroy gets booted at the next election he'll go straight for a job at one of the NBN Co suppliers' boards?

the book I referenced above looks to have the right of it.

Or perhaps the plan is for this to be a cheap upgrade for Telstra

http://www.itnews.com.au/News/252963,telstra-best-placed-to-exploit-nbn-fire-sale.aspx

""No private equity firm could come in here and say we'll buy the NBN because [the NBN] doesn't work unless you've got the customers, [and] Telstra owns the majority of customers.

"So if the NBN fails - and I think ultimately it will, that's not me being an anti-NBN blah blah blah - as a pure businessman I look at this and think this is a bad investment and this will fail. If that's the case, Telstra is in my opinion the only possible buyer.

"They've got their [4G] spectrum, they've got their money, they get to buy [a fixed network] back for 20c in the dollar," Slattery said, to nervous laughter."

Sounds altogether too much like the sort of reasoning a group of hard-nosed businessmen such as Telstra's board might use, don't you think? In this scenario, Conroy dips out altogether, which might make more sense, given his efforts to bowdlerise the web.

Just for the record, BTW, the NDN doesn't have "unlimited" bandwidth either. It uses a PON system that has 32 users connected to each node, not unlike the way HFC has a variable but set maximum number of users per node. If a ot of the users choose hig-bandwidth connections, the speed of all of the conections slows down.

http://en.wikipedia.org/wiki/Passive_optical_network

Further, the whole productivity issue is showing itself to be no more than wishful thinking.

http://www.zdnet.com.au/productivity-claims-alone-dont-justify-nbn-339320721.htm

"We face similar challenges of definition in Australia, where fevered debate about the NBN has been polarised between those who demand hard numbers to justify its substantial investment and those who, having taken the project's merits on faith, gild their statistical liberties with procedural assumptions to back their foregone conclusions."

Sound like anyone you know?

Rstuart,

"Secondly the argument "we are spending too much to build something that people can't pay for and won't use" only makes sense if in fact they can't pay for it and won't use it."

The same would apply if the government installed new water lines to each house, cut off the alternative supply, and charged double the price. People would use it because they had to, not because they wanted to. This is the inherent danger of Labor inspired state monopolies.

oops, didn't link to the audio interview on li-fi

Here it is

http://news.bbc.co.uk/2/hi/programmes/click_online/9566689.stm

SM's point about this having to be an artificial monopoly to succeed is absolutely correct

@Antiseptic: Here's a link to an interview with a developer of the technology. Have a listen, it's only a few minutes long.

Sadly it tried to set up an RTP link, which didn't make it through my firewall. Besides 18 minutes is not "a few minutes" in my book.

Visible light being be stopped by rain, fog, leaf or dust raised by a passing car means I put the idea of using light frequency broadcast wireless to implement the NBN into the same class as saying we will be able to solve Peak Oil using the Joe Cell: http://peswiki.com/index.php/Directory:Joe_Cell Also notice how they are rolling out the NBN now, and broadcast Li-Fi isn't shipping now, and may never ship.

As for the rest: it isn't difficult to find people asserting all manner of things, just like Joe above. I prefer to look at the basis of those assertions. I notice Bevan Slattery didn't give any for his claim the NBN will fail. It is a pretty bold claim, given it will be profitable if it just collects the broadband payments being made now and they will have a monopoly, don't you think?.

OK, I know you didn't bother thinking about it, you just accepted it at face value because it happens to agree with your political outlook. But before you do that it in future it might be helpful to look at the speakers background. Bevan Slattery owned Pipe networks. It will be wiped out by the NBN. I imagine he is pretty pissed off about his creation being destroyed.

@Antiseptic: Just for the record, BTW, the NDN doesn't have "unlimited" bandwidth either.

No one said it did, but why bring it up? You say we won't be able to use the capacity it does have. Are you now claiming that is isn't unlimited is also a problem?

Do you actually have a coherent argument, or are you just writing the first thing that comes into your head? Seriously - I do put a bit of thought into what I write here. It would be nice if you did too.

@Shadow Minister: The same would apply if the government installed new water lines to each house, cut off the alternative supply, and charged double the price. ... This is the inherent danger of Labor inspired state monopolies.

You simply can't stick with what we know can you Shadow? If the current reality doesn't suite your argument you just invent your own. That is just sad.

Here are some reality checks:

- We don't know what the NBN prices will be, but on the evidence to date it will be the same.

- In SA the Liberals monopolised electricity generation. Recently it was SA Labor who privatised it. That has been the pattern in most of the states. Typical Labor behaviour indeed! It was Labor _privatising_ road building that got NSW into the current mess. If they to fund it themselves those toll roads would not have been built.

- Once electricity was privatised prices when up. The one state that has lagged the price rises is NSW, because they didn't privatise. That has also been the experience in the US. So much for assertion that government monopolies lead to higher prices for the consumer. Notice NSW roads followed the same pattern.

Funny how that is 180 degrees from your world view Shadow. But then the world is a complex place - I am sure there are counter examples.

I wonder if the reason you are so attached to your blue glasses is they keep the world simple, making it so much easier to deal with. You don't have to look at the issues in any depth at all for starters - you can just uncritically accept whatever rubbish your mates are spouting on the day.

Me, I can't do that. My world is messy, fully of compromises and shades of grey. I rarely accept what anybody says at face value, and I don't identify with anybody in particular as "my side" - certainly no current Australian politician. I imagine my world is a lot more difficult to deal with - but I wouldn't have it any other way.

"We don't know what the NBN prices will be, but on the evidence to date it will be the same."

The evidence to date is that the NBN prices will equal one of the more expensive providers today in 5 years time, defying the global downward trend.

Labor's public private partnership was yet another prime example of a money grab, where a private partner was promised profits by the government closing off competition, and essentially ripping off the consumer.

The occasional sale of public assets by a Labor government is an exception. NSW public electricity generation sells power to the network at a higher price than private assets, and is no way competitive.

Victoria Liberals sold the near bankrupt public Latrobe power stations to private enterprise who could then sell power competitively.

Actually, it's just 9 minutes. Perhaps you can listen to it later. It might make you think for a change... Look up "noise cancelling" for a start, if something that complex can make it through your firewall.

The point is that they shouldn't be "rolling out the NBN now". Do you normally have this much trouble with comprehension?

It has nothing to do with my political outlook and everything to do with simple principles of prudence in investment. There is no compelling reason to do it. Simple. Bevan Slattery has a world of experience and expertise in running high-capacity fibre in a competitive business environment. I tend to think he might be able to shed some light on the business case.

Have a look at that book on management of major projects, you might learn something from that too.

The point about the fibre bandwidth is that it's based on a relatively crude version of the technology that effectively exchanges the "C" part of the HFC network with fibre, to all intents and purposes. The HFC model only lasted about 15 years. Conroy expects this to last no longer than 20, if the non-compete clause is any indication.

We might almost be getting to the point that having a fibre connection will be desirable by then, if some new form of interaction is invented and widely adopted.

@Shadow Minister: The evidence to date is that the NBN prices will equal one of the more expensive providers today in 5 years time, defying the global downward trend.

Actually the evidence we have is from the two providers who have NBN plans. In both cases their NBN plans are priced either identically, or less than their ADSL plans. You are claiming other providers will do it differently. Do you have a basis for this, or are you just making it up as you go along?

@Antiseptic: Actually, it's just 9 minutes.

The amazing changing link. It works now - with different flash player and different format, and its 3min 30sec. My he is enthusiastic about his own ideas, isn't he? I on the other hand am struggling to see how this will be an improvement on WiGig, which unlike his stuff it out of the laboratories and actually has a chance of being released in the foreseeable future. Unfortunately I can't see many uses for WiGig either.

@Antiseptic: There is no compelling reason to do it. Simple.

Actually there are lots of good reasons to do it. You don't find them compelling. But since the average broadband speeds here in Australia are under 7Mbit/s in Australia, a lot of people do.

@Antiseptic: The HFC model only lasted about 15 years

Possibly because fibre was already better than the cable, when the cable being rolled out?

@Antiseptic: Conroy expects this to last no longer than 20

You acknowledged there is nothing faster than fibre earlier. Please don't make yourself look like a complete idiot by claiming LED's transmitting through sunlight are one day going to be faster than laser's in a glass wave guide.

@Antiseptic: We might almost be getting to the point that having a fibre connection will be desirable by then

Having something of the order of 20Mbit/s is desirable now. 12Mbit/s is what the NBN is charged with delivering. Circumstances are such that the only way to achieve this is to roll out fibre.

Rstuart,

The NBN prices are not lower than the most competitive ASDL prices available, such as TPG.

There is no indication that the NBN prices will decrease over time. Whereas the ASDL prices have been decreasing on an almost annual basis.

rstuart, do try to keep up:"You acknowledged there is nothing faster than fibre earlier. Please don't make yourself look like a complete idiot by claiming LED's transmitting through sunlight are one day going to be faster than laser's in a glass wave guide."

Nobody is suggesting that, merely that the PON approach is not using the fibre to its capacity. In 20 years, when the need for fibre is there, it will need significant upgrade. In the meantime, many other technologies are emerging that make it ever-less viable prior to that 20 year window expiring.

It's a matter of planning for the likely need, rather than "build it and they will come". As that book I referenced earlier makes clear, that NEVER happens - they never come at the rates predicted by the technology spruikers. It's wishful thinking of the worst kind. Was HFC a great success do you think? Having worked on both the networks for 10 years I can tell you it was far from that. A great deal of the Optus network was simply switched off in the early 2000s because of lack of a subscriber base. It remains off to this day. HFC was chosen because it was relatively cheap. AS I recall, Telstra's original network was second-hand from somewhere in the US. Around $10billion was spent on rolling it out in the late 90s.

[cont]

Modulation of light signals is old hat. What do you think fibre works on? The only difference is that with no wave guide there is no huge infrastructure needed. You're obviously unfamiliar with the huge developments in LED technology and CCD as well, which make "naked" light networking much less problematic.

Other advantages include: no crosstalk, no EM interference, ubiquity.If every source of artificial light is potentially a broadcast point, there is a completely immersive network.

I suggest to you that there will be working gear for sale using this technology within 5 years. As he made clear, they plan to work on applications for areas that are sensitive to EMI initially, which also happen to be high-profit.

It won't take long for it to become widespread. Even with the NBN, wireless will become the standard model, except for some larger firms. Homes won't have any need for anything else.

Having 20Mb/s may be "desirable", but it's not necessary. Having a Rolls Royce is "desirable", but if a Governemnt came up with a policy of a Rolls Royce for every home it would be seen as obviously ludicrous.

I have an 8Mb/s connection via ADSL. It slows a little when there are 3 people wanting to d/l or stream at the same time. Big deal.

And then there's this...

http://www.theaustralian.com.au/national-affairs/nbn-cost-to-widen-the-digital-divide/story-fn59niix-1226120000176

"THE company rolling out the National Broadband Network wants the ability to increase prices for business broadband and super-fast services by up to 5 per cent more than inflation for three decades, prompting warnings of an end to the era of falling communications prices. "

"The discussion paper, released late last month, argues that NBN Co needs "commercial flexibility" because despite multi-billion-dollar deals reached with Telstra and Optus, there was still "demand uncertainty"."

Did you get that? "Demand uncertainty", so they want to be able to jack prices up to cover the losses. That's even WITH a guaranteed monopoly.

What a deeply stupid program.

@Shadow Minister: The NBN prices are not lower than the most competitive ASDL prices available, such as TPG.

NBN prices are lower than what TPG charges. NBN prices are $24/mo for unlimited data, TPG's is $60/mo for the same thing. Of course the NBN is wholesale, TPG is retail and we don't know what TPG will charge. That is the entire point.

@Shadow Minister: ASDL prices have been decreasing on an almost annual basis.

Not really. Did you notice that the minimum price for an ADSL link hasn't changed over the years? That is because the price the ISP's get charged for the local loop hasn't changed - probably because it is owned by a monopoly. The price drops you are seeing are for back haul data.

You are probably right the NBN charges for the local loop won't change over the next decade or so - just as the charges the copper equivalent haven't changed. But the charges for backhaul data will continue to drop.

On the subject of Labor and privatisation, did you notice Mark Lawson's article here on OLO on the most expensive government business flop in my time - the AWC? Of course you did. It must have been uncomfortable for you, it being your side who was responsible for it.

@Antiseptic: the PON approach is not using the fibre to its capacity. In 20 years, when the need for fibre is there, it will need significant upgrade.

Amazing. You manage to contradict yourself in consecutive sentences. You say (rightly) we aren't using anywhere near fibres capacity, you say earlier there is no use for this excess capacity, and now you say we will not only find a use for this excess capacity, we will exceed it and need a significant upgrade?

That aside, as you full well know to upgrade the fibre we just need to change the electronics at each end - just as we did with ADSL. It is not an expensive exercise. The expensive part of the exercise is laying the cable.

@Antiseptic: build it and they will come

Is this the fantasy you building up in your mind - the NBN will only work if it attracts new customers. Do actually read anything that is presented here? The NBN business case doesn't rely on any new customers "coming". They will make a profit with the existing customer base, which they are almost guaranteed to get.

@Antiseptic: Other advantages include: no crosstalk, no EM interference, ubiquity.If every source of artificial light is potentially a broadcast point, there is a completely immersive network.

Good lord. You have wrapped yourself up so tightly in your wireless fantasy, you can't see the obvious flaws in your visions.

Crosstalk: two leds in the same room.

EM interference: Light is Electro Magnetic Radiation. So when light is your carrier all other light is EM interference.

Immersive network: Only if every light bulb is connected to a broad band network, like the NBN say.

@Antiseptic: I have an 8Mb/s connection via ADSL.

Lucky you. They reason we are building the NBN is because most people don't.

@Antiseptic: A great deal of the Optus network was simply switched off in the early 2000s because of lack of a subscriber base.

Yes - but that was a case of build it and they will come, wasn't it? There wasn't a pay TV network before, so it really was built on hope. And in an amazing failure of private enterprise to act in their own best interests, we had two companies rolling cable down the same street, thus halving their potential customer base. The NBN may fix that little débâcle.

@Antiseptic: super-fast services by up to 5 per cent more than inflation for three decades

I imagine the ACCC won't mind this. They are asking for price flexibility in areas they do have competition. For broadcast video they are up against the HFC network, and data centres usually connect directly to the backbone. If the NBN manages to win their business - well good for them. It will have to be on a commercial basis.

It is rapidly becoming clear that the NBN co cannot be profitable at the present pricing:

"The taxpayer-owned NBN Co suggested in a recent discussion paper that it be allowed to raise prices by up to 5 per cent more than inflation for high-speed services once the network was complete early next decade. The mooted increases in wholesale prices appear to be at odds with commitments from NBN Co to reduce its prices over time."

http://www.smh.com.au/technology/technology-news/nbn-push-for-rise-in-key-rates-flies-in-face-of-reduction-pledge-20110822-1j6ur.html

I think that this is now done and dusted.

rstuart:"They will make a profit with the existing customer base, which they are almost guaranteed to get."

And will probably lose as wi-fi becomes better. That's the point. It won't make a profit if there is a bleed of customers who are happy with the performance and lower cost of 4G, and it's not sure it has enough demand anyway. Do tyou ever actually read what's written before you start blathering?

rstuart:"Crosstalk: two leds in the same room."

Nope, different modulation - no crosstalk. As he said they use time-domain and power(amplitude) domain. No cross-talk. Then there's the whole use of LEDs of different frequencies in a single "white" light, that can be operating on completely different parts of the spectrum. This is already done in multi-mode fibre, but usually only with a couple of wavelengths, since it's difficult to get a reasonably optimaised fibre diameter if you've got too many fequencies and hence there are lots of lossed due to absorption, since the incident angles can't be made perfect for the wavelength. Multi-mode fibre is sort of halfway between single-mode fibre and li-fi. Li-fi would not suffer from the wave-guide absorption problem, since it's freely propagated in air. Stop me if you're finding this difficult, won't you?

rstuart:"EM interference: Light is Electro Magnetic Radiation. So when light is your carrier all other light is EM interference."

Yes, but it can be easily removed from the signal. This is trivial stuff. See "noise-cancelling" above. Have you looked that up yet? The point about EM interference, however, was that radio/microwave frequencies interact with wires to induce currents. Hence, devices using those frequencies are prohibited in aircraft and in hospitals.
[cont]

rstuart:"Immersive network: Only if every light bulb is connected to a broad band network, like the NBN say."

Well, it would be, except not like the NBN, via li-fi. I have a streetlight outside my house. There are several other streetlights in the street. There are similarly lots of streetlights on the road my street abuts. And so it goes. I'd go so far as to say that li-fi will eventually exceed the capacity of single-mode fibre eventually. The capacity to carry signals on many different parts of the spectrum, including even IR or UV, is huge.

rstuart:"data centres usually connect directly to the backbone."

You mean like PIPE's network? I thought Bevan Slattery was a dope who didn't know what he was talking about...

@Shadow Minister: It is rapidly becoming clear that the NBN co cannot be profitable at the present pricing

In other news Telstra have recently pushed up their wholesale ADSL pricing. I guess this clearly means Telstra is in danger of gong broke next year?

You are clutching at straws again Shadow. This news snippet tells us very little. By the way, Antiseptic posted the same news story earlier. I did respond to it then.

This might interest you. It is a presentation hosted by Macquarie University's Engineering department on the NBN. The speaker is the NBN's lead architect, and it is aimed at an engineering audience. Being an government employee he deliberately avoids the politics.

http://www.youtube.com/watch?v=6a2ne1WKxek

There were two new bits of info in there for me. One was the expected lifetime of the fibre (at least 60 years), and the other was why they didn't choose FTTN.

@Antiseptic: And will probably lose as wi-fi becomes better.

This reminds me of a cartoon popping up recently. The caption reads "somebody on the internet is wrong .. what ya going to do about it". I don't like the implied answer, but there comes a point where it is the only sane course of action.

@Antiseptic: Stop me if you're finding this difficult, won't you?

Excellent suggestion. This conversation is getting difficult. Amazingly we recently had an OLO article on this very situation. Maybe you remember it? "The silver bullet men: Saving the planet with technology". http://www.onlineopinion.com.au/view.asp?article=12407

One piece of advice. Using big scary words like "wave guide modulation" won't always convince someone you have a clue. I think a 2 year old would understand why he can see a laser shining at the other end of a 15km piece of fibre, but not LED shining in the sunlight 15km away. In fact I would have thought it was blindingly obvious, but apparently not to a true believer like yourself.

@Antiseptic: This is trivial stuff.

I agree. Not quite blindingly obvious, but pretty simple. Sadly we have got past the stage of acknowledging the blindingly obvious.

rstuart:"I'm out of my depth"

Well why didn't you say so earlier?

Rstuart,

"In other news Telstra have recently pushed up their wholesale ADSL pricing. I guess this clearly means Telstra is in danger of gong broke next year?"

Precisely, the NBN with all competition banned can simply make a profit by pushing up prices, and the consumer simply has to suck it up.

As for the video, I did not have time to watch all of it, but it was an an obvious attempt to justify the NBN.

PS, copper cables also last 60 years.

@Shadow Minister: with all competition banned can simply make a profit by pushing up prices, and the consumer simply has to suck it up.

You are as usual distorting things so they will fit the narrative you are trying to build. The article said quite clearly the consumer prices are fixed - they can't raise them.

Also my understanding is competition wasn't banned. They just bought non-compete agreements from the incumbents for around $10 billion. You are welcome to go out there build your own competing fibre network - best of British though.

On the prices they are asking for flexibility on, not only is the competition not banned, it wasn't bought either. For streaming video there is the HFC network will still continue to operate as a commercial venture, in full on competition with the NBN. I am a bit puzzled what they planning to do with data centres, as they typically build their own trunks to the internet backbone - bypassing the NBN entirely.

And the funny thing it I suspect you have is arse about, again. I would not be too worried about the NBN raising prices in areas where they have competition. It would be dropping them. In 10 years time once they have their revenue stream, they may well be able to drop prices to force the HFC network out of business, and then raise them again once they are gone. That is what a private company would do. It is what Woolworths does to small stores in regional areas for example.

@Shadow Minister: PS, copper cables also last 60 years.

The new stuff might. The older stuff much of us are using is insulated with paper. It also suffers horribly when the joints go under water, as I know to my cost. Fibre doesn't - the manufactures are rating it at a _minimum_ of 60 years.

@Shadow Minister: but it was an an obvious attempt to justify the NBN.

Cut him some slack Shadow. He is an engineer talking about his creation. Not everyone is a tribal and political as you, so they don't view everything in those terms. If he didn't believe he was doing the job he has been charged with as best as it can be done, and wasn't prepared to defend himself against people who he wasn't doing that he should not have the job.

Besides if you want to know the technical reasoning behind why something is done he is the go-to guy, not some politician or journalist. Yet so far here we have quoted journalists and politicians, not the engineers. Me, I always find stories from engineers about the problems they faced and how they are solving them interesting. I thought you would too.

Rstuart,

I hate monopolies with a passion, especially those that use undue influence to ban competition. If the NBN was not government owned and had specific legislation protecting it from the ACCC, its directors would be prosecuted.

If the government did not destroy the existing networks, and did not ban competition, I would be an avid supporter.

As for the "technical" presentation, while there was a lot of information, there was a lot of information omitted. For example, Fibre to the node was dismissed, because of the cost of the active equipment in the node, what was omitted was the need for battery back up in each house hold and the expense single mode fibre modems in each household compared to the cost for the one node serving 200 houses.

While he did use a lot of buzz words, little of what he introduced was new or in depth, and was simply a sales presentation.

@Shadow Minister: I hate monopolies with a passion, especially those that use undue influence to ban competition.

You are not unique in hating monopolies. But the NBN isn't going to change that. Effectively all that is happening it the name of the owner is changing. Before 2004 it was the government. Post privatisation it became the Telstra Shareholders. Now its going to become the government again. About the only change is there was a small amount of data carried by Optus cable. Now there won't be. The rest was carried by Telstra. Now it will be the NBN.

In other words there is no new monopoly being created, so I simply don't get the monopoly argument.

As for destroying stuff, everything remains in place bar the copper. So we keep HFC for video, and mobile continues to offer data. The copper is only being replaced because it is owned by a private monopoly who isn't interested in using their profits to upgrade it, and no one can figure out how to bribe them into doing it. It if the Libs hadn't of sold it off as a private monopoly, then upgrading the copper would have been an option. But they did sell it, so it isn't.

I keep repeating this, but it is the crux of the argument. Both sides tried to do what you suggest and upgrade the copper. Both failed.

@Shadow Minister: what was omitted was the need for battery back up in each house hold and the expense single mode fibre modems in each household compared to the cost for the one node serving 200 houses.

Looking on the web, they are using an Alcatel-Lucent ONT which it seems you can buy for around $250 retail. http://islamabad.olx.com.pk/nayaltel-ont-alcatel-for-sale-iid-42078963 I presume the NBN will be paying 1/2 that. They aren't that expensive. They don't maintain the battery - that's your problem. They don't have to power it, cool it, house it or visit it regularly. Besides, he didn't say it cost less up front, his point was it cost less to maintain. I'm sure he is right.

Actually,

The ownership is not just changing. Presently we have both Optus and Telstra with lines / cable, and none of them have competition banned.

http://www.theaustralian.com.au/news/opinion/the-gouge-is-on-for-nbn-users/story-e6frg6zo-1226122392946

"WHEN Ralph Willis announced his telecommunications reforms in 1989, he delivered immediate price reductions and a price cap under which prices would fall steadily in real terms. Willis's reforms ushered in a long period of productivity increases that allowed price declines up to the present day.

In contrast, it is now clear this government's national broadband network will involve a huge slug to consumers. Indeed, Australia will become the only advanced economy where telecommunications prices rise steadily over time."

@Shadow Minister: none of them have competition banned.

Are you sure it is banned? My understanding is they just came to non-compete agreement with Telstra and Optus. There is no law saying you can't put in new local loop's. It is continues to be (as it was back then) economically impossible to do so, which is why no one (not even Optus) did it.

@Shadow Minister: Ralph Willis announced his telecommunications reforms in 1989,

You know why Willis could say such a thing, don't you? Because back in 1989, the government owned Telstra. This is actually a counter example to your claim that government owned monopolies always drive the prices up.

You might want to contrast that to what Telstra did last month. Surprise, surprise, a private monopoly raises the prices it copper land lines. There is no justification for it - it isn't like they are trying to fund a upgrading of the copper network as after all the NBN is coming. They are pushing up the price because they are a monopoly, so they can. Private monopolies gouge every last cent out of the customer - because by law that is the duty the directors of a private company own to their shareholders:

http://www.brisbanetimes.com.au/business/phone-bills-to-rise-as-telstra-ups-line-rental-fees-20110724-1hvgn.html

I detest monopolies as much as you do Shadow, but the sad fact is that some things naturally tend towards monopoly. Sometimes clever financial engineering can create a market. That is what the Feberal Libs did with water, and the predominately Labor states did with electricity - much to their credit. Can you see how break up the current land line monopoly? I can't. Maybe some clever economist will figure something out. But I am sure of one thing - while it remains in private hands, it is impossible to weave any financial magic. To do so would stomp all over the property rights of the Telstra Shareholders.

Rstuart,

There is a law stopping people putting in local loops. The new laws prevent people cherry picking profitable areas by making it a requirement to provide connections to everyone in Australia or no one.

There may be natural monopolies, this is not one.

@Shadow Minister: The new laws prevent people cherry picking profitable areas by making it a requirement to provide connections to everyone in Australia or no one.

Do you mean new as in recent? Optus offered voice over their HFC network for a while. The quality was by all reports dreadful, so they dropped it.

Still the existence of a law doesn't alter the outcome much. Real competition in Australia has happened with fixed line precisely once: when Telstra and Optus and rolled out HFC down the same streets. Antiseptic said earlier Optus ended up turning off large chunks of their network (which was news to me - but he was involved in the rollout). Telstra ended up getting the law changed, so they could show ads on what was supposed to be an ad free medium. The government agreed because they could not survive any other way.

Doing that was a commercial insanity. I doubt it has happened anywhere else, and I doubt it will happen again. Most private organisations would have and worked out how to carve up the customer base between them, so they each had exclusive access to a given household, allowing their prices to be constrained only by the customers ability to pay. There was no needed to break the law in any obvious way - just start in different areas and avoid putting up cable where there already was some.

Doing anything else was a complete failure of common sense. But that is rare, as common sense usually does prevail. That is why land lines are natural monopolies.

I imagine local electricity poles and wires suffer from the same fate. We handle it in the same way, don't we? Some government quango owns the local infrastructure were there isn't competition, and we introduce private enterprise as soon as competition becomes possible - ie in the long distance transmission, generation, and retailing.

Rstuart,

If it is not necessary to ban it, then why do it? You are grasping at straws. As I said, if it wasn't necessary to ban competition, I would back the NBN.

All the signs are that the project is costing more than anticipated, and the returns are lower than anticipated. The profits will be guaranteed by gouging the customers that cannot go anywhere else.

@Shadow Minister: If it is not necessary to ban it, then why do it?

Are you claiming competition was banned to build the NBN? As far as I know it wasn't. Nothing has changed. Whatever the status quo was - it remains.

This is in many ways simply a commercial transaction that happens to involve the government. The government didn't change the laws in the way you are suggesting to make it happen. Telstra has obsolete technology. A new, very well funded competitor has come along - one with enough money to build an entire new network using shiny new technology that will render Telstra's network obsolete. Telstra and Optus, seeing the inevitable, sold their customers to the newcomer. That is what happened to the competition. There was none before, and there will be none now as the existing monopoly is simply changing hands. Nothing was "banned" by government fiat.

That is a simplification, as the government did change some laws. But those changes were in Telstra favour - they relieved it of its Universal Service Obligation.

I know you love the "Labor party nationalises the world narrative". Forget it - that isn't what is happening here. In fact both sides of the political divide would apparently have preferred to getting private enterprise to build the network, as that is what both tried first. The NBN route was taken only when that route failed.

@Shadow Minister: All the signs are that the project is costing more than anticipated, and the returns are lower than anticipated.

There are signs? As in something you saw you morning tea leaves perhaps? If you have something more substantial cite your sources, otherwise give it a break. Only you and I are here Shadow, and I am can assure you not interested in your speculation.

RS,

"Are you claiming competition was banned to build the NBN? As far as I know it wasn't. Nothing has changed. Whatever the status quo was - it remains"

Sorry no. The status is not Quo.

Just read this.

http://www.theaustralian.com.au/business/nbn-laws-anti-competitive-says-aapt-chief-paul-broad/story-e6frg8zx-1226030989662

If the Coalition reverses these laws, the NBN collapses.

also

http://www.theaustralian.com.au/australian-it/accc-concerned-at-telstras-agreement-not-to-promote-wireless-as-a-substitute-for-the-nbn/story-e6frgakx-1226125493744

"Among issues worrying the ACCC is an agreement that will prevent Telstra from actively promoting wireless services as an alternative to the NBN network - a measure critics claim is an attempt to stifle competition and prop up the NBN business model."

@Shadow Minsister: If the Coalition reverses these laws, the NBN collapses.

From the article:

"Mr Broad said NBN Co's commitment to a uniform wholesale price across the $36 billion fibre network was inefficient"

And of course he is right. The NBN Co could make far more money if they were allowed to cherry pick their prices. How you could think it would do the reverse and send the NBN broke is beyond me.

@Shadow Minister: The status is not Quo.

Yes, it is. In fact, it is preserving it. The Universal Service Obligation is being transferred from Telstra to the NBN, as it should be. The retail arm of Telstra is now free to complete in all other areas it operates in (mobile wireless, back haul) without restriction. This is a good thing. The one downside is I suspect over time many outback towns will loose their mobile coverage, which Telstra up till now obliged to provide.

The USO is inefficient, but it is actually a Coalition thing. It's beloved by the Nationals, as it is the only way their constituents get a phone service.

@Shadow Minister: an agreement that will prevent Telstra from actively promoting wireless services as an alternative to the NBN network

Yep. But notice this is _not_ a law. It is a clause in a commercial agreement between NBN Co and Telstra. Everyone else is free to compete with the NBN using mobile wireless. This happens to be exactly the situation I painted in my previous post.

And of course they didn't quote the entire ACCC comment. Here is another relevant bit:

"The ACCC notes in its paper that Telstra has indicated the wireless restrictions are only a very limited constraint on its operations, and that it intends to continue to provide wireless services as complementary to fixed line services, even in an NBN world."
http://delimiter.com.au/2011/08/30/wireless-nbn-clause-could-harm-competition-accc/

For what is worth, the restriction is Telstra can't advertise wireless as a replacement for fixed line. It isn't a restriction on what they can sell. In other words Shadow: you are making a mountain out of a mole hill.

By the way, I in doing yet more reading in researching for for the post above, I came across this:

http://delimiter.com.au/2011/08/30/fix-your-separation-plan-accc-tells-telstra/

The thing I wanted to point out is the amount of work the privatising of a monopoly creates. This was driven home to me many years ago, back in the era of the Howard government, when I learnt that there were two court rooms in Canberra devoted full time to doing one thing: arbitrating between ACCC and Telstra.

Telstra, being a privatised company, was doing it's damnedest to bleed us all dry. (At is should - it is the remit of a private company is to make as much money as possible.) I don't know whether the Howard government anticipated this, but nonetheless they had to create a department with a phalanx of lawyers to rein in the monster they created. I have never been able to find the reference again, but the above link paints the picture:

"Telstra doesn’t hire whole floors of lawyers from law firms like Mallesons Stephen Jaques (from what we hear, it has been more akin to an army at some points) to naively and honestly create ACCC submissions which run along the lines of what the regulator and its rivals want. After several decades of forced negotiation at arm’s length through the ACCC, Telstra’s used to this process."

The end result was the government made the final determination on Telstra's wholesale prices, but rather than just setting it they had to go through a horribly inefficient and time consuming process. All that disappears when ownership reverts back the the government, as it will with the NBN.

And so back to your original point. You seem to be claiming the NBN is shutting down competition, and introducing government mandated pricing. But there was no land line competition, and the government sets the prices now. And worse no one - not even you, has come up with a way to introduce competition. Not once. You just was to preserve the status quo - a private monopoly. Ick.

Oh, and one more thing. We seem to have had our fill of the radio discussion, but this might interest you. In the other NBN thread started by csteele, I tried to explain that what limits wireless is the amount of CPU power you can throw at the problem - not traditional things like amps and antenna design.

This link has a graphic (titled "Modem relative performance") that illustrates the point rather well:

http://www.theregister.co.uk/2011/08/20/microprocessors_may_face_trouble_ahead/

Note that 3.9G / LTE is what we (well at least Telstra and the NBN) are rolling out now. True 4G / LTE Advanced remains a glint is some engineers eye. Given that the first crop mobile phones that implement LTE get so hot they become uncomfortable to hold, it gives you an idea of what the problems the leap from 3.9G to 4G will entail - if it happens at all.

Why it may not happen at all is explained in the next page on that article. Look at the grapic titled "Fabs: not as popular as they used to be" here http://www.theregister.co.uk/2011/08/20/microprocessors_may_face_trouble_ahead/page2.html

That graph looks exactly like my professor's at Uni foreshadowed some (embarrassingly many) decades ago, when they explained what the end of the Moore's Law era would look like. Their point revolved around a simple correlation: as the semiconductor feature size decreases, the cost of building a plant to manufacturer it increases exponentially. As the cost goes up, fewer and fewer players are able to get the capital to build a new foundry. At some point the number of competitors drops so low that there isn't enough competition to drive the 2 year cycle building of a new foundries, and you end up with a oligopoly that no longer has to innovate to survive. And so ends Moore's law.

As you can see from that graph, there are now 5 companies still in the game. The next feature sizes are 15nm, and 10nm. 10nm is looking iffy, but 10nm is probably where we need to be at for a viable 4G modem.

Rstuart,

"And of course he is right. The NBN Co could make far more money if they were allowed to cherry pick their prices. How you could think it would do the reverse and send the NBN broke is beyond me."

In your comment you confirm that smaller companies can provide services far cheaper than the NBN. But it goes further than this. The so called anti cherry picking legislation goes far further than anti cherry picking, it allows an alternative network to be built only if it services everyone (ie an second NBN) which effectively bans all other fixed line installations, and all competition whether cherry picking or otherwise, and irrespective of whether they can provide better or lower cost systems, or even for a different purpose.

The government intends to pay both telstra and optus to decommission their networks and refrain from advertising the wireless as an alternative to the NBN. Considering that these two companies supply about 70% of the internet this is a pretty big anti competition push.

The advertising is a broad brush ban and is a legally enforceable contract. No advertising means no promotions, web information, sales people etc. While theoretically possible to sell wireless internet as an alternative, it is impractical.

The NBN is putting the competition in networking back decades.

@Shadow Minister: The so called anti cherry picking legislation

For gods sake, there is no new anti cherry picking legislation! At least I haven't seen it, and you haven't shown the existence of any. This means the government hasn't introduced any new legislation to ban competition in order to create the NBN. Get this idea out of your head! What they have done is enter into business agreements with Telstra and Optus.

If you have some spare hours annex 1 of the NBN proposal Telstra is putting to its shareholders makes interesting reading:

http://www.asx.com.au/asxpdf/20110901/pdf/420t3s6kwntyq1.pdf

Telstra faces a choice: either go along with the NBN agreement, or compete head to head with it. They are free to do either of course which is why it being put to a shareholders vote. This should make it clear to you there is NO legalisation banning competition. In the opinion of the authors of annex 1, if they try to compete with the NBN they loose to the value of $4.7 Billion (Annex 1, page 9).

@Shadow Minister: No advertising means no promotions, web information, sales people etc. While theoretically possible to sell wireless internet as an alternative, it is impractical.

You seem to be implying that Telstra and Optus can not advertise wireless data. On the contrary, they can advertise their wireless data as much as they like, provided they avoid saying it is a "fixed line alternative".

You are trying to build this up into something it's not. A clever marketing agency will have no trouble working around this, which is probably why Telstra says this restrictions impose "a very limited constraint on its operations". It's so weak I don't know why they bothered. I guess it's just making doubly sure Telstra won't roll out fixed wireless.

And it you still harbour doubts about the growth of fixed broadband, take a gander figure 8 on page 13 of that shareholder proposal.

Rstuart,

Yes there is new legislation to ban competing networks. As per my previous link.

"Speaking at the CommsDay Summit in Sydney yesterday, AAPT chief executive Paul Broad warned that the uniform price directive, anti-cherry picking provisions -- which prevent companies from building competing networks to NBN Co -- and the prohibition on volume discounts would stifle competition and erode retail margins."

@Shadow Minister: Paul Broad warned that the uniform price directive, anti-cherry picking provisions -- which prevent companies from building competing networks to NBN Co

He lies. The anti cherry picking provisions don't ban people form rolling out their own fibre networks. Quoting from http://www.arnnet.com.au/article/380119/concerns_over_nbn_anti-cherry-picking_laws_overstated_senate_committee/

"the requirements do not prevent other companies from rolling out fibre networks ... The provisions do not compel ISPs to match NBN Co’s operations, terms and conditions but they do require carriers to operate within a comparable regulatory framework"

In other words this is about ensuring the Universal Service Obligation isn't undermined. And again: the USO comes from your side of politics. It is designed to ensure people in the country have equal access to telephone services. It is still coalition policy and isn't likely to change any time soon. It has nothing, whatsoever, to do with the NBN, and if the coalition ditches the NBN the things in it you are railing against will still be with us.

Can you give this "the government has banned competition to make the NBN possible" line up Shadow? I do read some right leaning web sites, and I know it is a popular meme. It also happens to be rubbish.

You are letting yourself be snowed by billy tea wantabe's trying to whip up some hysteria. You first tried to say the government legislated to force Telstra and Optus to sell out to the NBN. They didn't - it was a commercial transaction. You have said Telstra has been banned from competing with fixed line using its mobile wireless network. It isn't. You are now saying new legislation bands building competing networks. It's doesn't. Please give it a break. Accept the fact that when one of these right wing sites makes claims like this, they are probably lying. Do some basic fact checking before repeating it here.

Rstuart,

http://www.zdnet.com.au/nbn-amendments-clarify-cherry-picking-339311912.htm

Those providers who do build networks after the 1 January 2011 data, and are hence not exempt, will have to provide open wholesale access to their networks. Conroy said the amendments would ensure equal broadband access across the country.

This essentially means they have to offer the same access prices to everyone. Which means if they don't build an entire network, they then have to buy the access from "others" which will cost them much more.

The effect is the same. The Universal Service Obligation was applied to Telstra, and was government subsidized. There was no ban on others providing services, such as Optus has.

As for the "commercial" contract, paying others not to compete is normally illegal, and is presently running foul of the ACCC.

@Shadow Minister: This essentially means they have to offer the same access prices to everyone.

Thanks for the link - it has a much better description than mine. It seems like they are forcing the industry to breakup into wholesale and retail divisions. I imagine its much the same as electricity now, with it's generation, poles and wires, and retail sections.

Do you have a problem with it? It looks pretty good to me.

@Shadow Minister: Which means if they don't build an entire network, they then have to buy the access from "others" which will cost them much more.

Sorry, I don't understand this. Why do they have to buy access from anybody? They connect a whole pile of premises to a building, put a "local connections 4sale" sign outside, and they are in the same business the NBN is.

Unless that link left something unstated these "anti-cherry picking" laws aren't anti cherry picking at all. Anyone is free do this in the most densely populated areas with the highest returns and charge what they please.

I would have thought this exactly what you wanted Shadow. There is no ban on competition. Everyone is free to enter the wholesale local loop market, under the same rules. Want to try rolling out fixed wireless to compete with the NBN? Then go for it.

So, for example we have from http://www.zdnet.com.au/new-nbn-bills-impose-developer-penalties-339311838.htm

"Developers are free to use other telecommunications providers, as NBN Co will remain the 'fibre provider of last resort'."

In other words, if you are a developer, you can choose anybody to service your new green-field development under the new rules. Under the old rules Telstra was required to pay installation in green fields, which sounds wonderful until you realise it guaranteed Telstra's vice like grip on the monopoly, because retailers had to rent the cooper off them.

@Shadow Minster: As for the "commercial" contract, paying others not to compete is normally illegal, and is presently running foul of the ACCC.

You could view it like that. You could also view it as the NBN buying Optus's and Telstra's fixed line business - which is legal. If you buy a business, having a clause preventing the seller from competing in the same area is normal - I've been subject to such clauses.

And no, it's not running foul of the ACCC. If you have only read the right wing commentary on the ACCC's concerns I'll forgive you for thinking they were hugely concerned by the "wireless non-compete", as that is where most of the column inches went. It was a beat up of course as there is no wireless non-compete, they only mentioned it in passing. In fact the entire NBN side was only mentioned in passing. If you read the ACCC's concerns they are mostly about Telstra being freed from it's regulatory yokes while it still has 10 years to run on its copper monopoly. Given Telstra's history, I'd be concerned too.

As an illustration of just how ferocious Telstra is, look at this comment from the US music studios http://arstechnica.com/tech-policy/news/2011/09/wikileaks-mpaa-behind-aussie-isp-lawsuit-but-dont-tell-anybody.ars :

In the course of their discussion, it appears that McCallum asked Ellis a pointed question. Why go after Australia's number three ISP, rather than its number one broadband provider, BigPond, owned by Telstra? "It was clear Ellis did not want to begin by tangling with Telstra," the message explained, "a company with the financial resources and demonstrated willingness to fight hard and dirty, in court and out."

Seeing a US lobby group cowering like that almost you feel proud to be an Ozzie, doesn't it?

The land line agreement only lasts for 10 years. I wonder if Telstra is free to re-activate the copper after that? I bet they are. Which means they are free to put in FTTN, and undercut the NBN, if there is a dollar in it.

Rstuart,

"OPTUS has promised not to criticise the National Broadband Network in key regions for 15 years under a deal that raises new warnings the $36 billion project will stifle competition."

http://www.theaustralian.com.au/national-affairs/optus-signs-up-to-national-broadband-network-gag-order/story-fn59niix-1226130972922

I'm sorry, but everything I see points to the NBN stamping out all competition, and the future price rises it is asking for will deliver Australia the most costly internet access in the OECD.

@Shadow Minister: OPTUS has promised not to criticise the National Broadband Network in key regions

How much negative advertising can you recall seeing in the ISP arena? I can't recall any. So they have agreed to not do something they don't do anyway. And you paint this as some huge restraint on competition. It's nothing of a sort. At worst, this is another attempt from the Australian to beat up some minor mole hill into a mountain.

@Shadow Minister: everything I see points to the NBN stamping out all competition, future price rises it is asking for will deliver Australia the most costly internet access in the OECD.

We have just established there is no law banning competition. In fact its the reverse - the Labor government has just opened to competition in the local loop arena to an unprecedented degree. Anybody can now built local connects without regard to the USO, cherry picking the best, most densely populated areas and sell access at whatever price they like.

See how clever I am Shadow? I've got someone on the far right saying allowing competition will be a failure, leading to more expensive outcomes. I'll turn you into a bleeding heart socialist yet!

But yes, you are probably right in saying the NBN will eliminate all competition. As I keep saying, local delivery infrastructure - be it in electricity, water, roads or local loops do tend toward monopoly. Usually this is aided and abetted by government laws. But not this time. If the local loop remains a monopoly it will only be because $27 billion bet the government making in the NBN comes off, and the economies of scale do indeed mean the NBN delivers better broadband than anybody else.

In other words your assertion the NBN will lead to hugely expensive prices is pure poppycock. Labor has structured things so that if NBNCo gets too greedy it will be torn the shreds by private competition. It either delivers better broadband for Australia, or it fails.

Also Shadow you seem to want a private monopoly to provide you with your broadband connection. That is what you will end up with if the NBN doesn't go ahead. I don't understand that - it is the worst possible outcome. This post from iiNet's CEO provides the classic illustration of how a private monopoly behaves http://forums.whirlpool.net.au/forum-replies.cfm?t=1749774#r19 :

--quote--
iiNet has now signed a fibre schedule after a lengthy and difficult process with the incumbent. Our new customer plans are being finalised and we expect to commence the migration of our customers in the next few weeks.

The agreement is unsatisfactory and is signed with the knowledge that we have no choice, given Telstra's massive power and the option of "sign before we cut your customers off."

What we haven't been able to secure is like-for-like services. Telstra simply refuses to our request for equivalent services to those available over the regulated copper.

Instead of a state-of-the-art fibre to the home service being built, we have a fibre network that won't cater for products currently being delivered on 50 year old copper.
--end quote--

If you want the highest prices in the OECD, with the worst possible service, having a vertically integrated private company provide your single, only choice for fixed line broadband is the surest way to achieve it.

"We have just established there is no law banning competition", Actually I showed the anti cherry picking law did just that.

They cannot sell below the price they are charged by the NBN even if they could build and deliver the services far cheaper in the area they chose.

Considering that network access prices have steadily decreased in the past, and the NBN is as or more expensive than what we have presently and intending to increase the prices in real terms, we will be worse off in 10 years with the NBN than we are now.

"Also Shadow you seem to want a private monopoly to provide you with your broadband connection. That is what you will end up with if the NBN doesn't go ahead." No we won't. We will only have a monopoly in areas where it is uneconomical and state help is required. Otherwise there will be competition.

Besides a private monopoly is better than a state owned one. The private monopoly works to regulated prices and makes a profit from reducing costs, the state owned monopoly charges consumers at cost plus an arbitrary profit.

@Shadow Minister: They cannot sell below the price they are charged by the NBN even if they could build and deliver the services far cheaper

That's new. I can't see where the link you gave says that directly. But as it did sound plausible I've spent 3 hours searching. The journalists are bloody useless - they just copy off each other, so if the first one doesn't mention it none of the copy & pasters will. In the end I found the proposed bill: http://www.comlaw.gov.au/Details/C2011A00023/d13bd023-bde4-41cd-bfae-40342b83b9c5 I hate reading law. Did you know you would me drive to this? If so you are a cruel bastard Shadow.

In the amendment I can see where it says any competing networks must be wholesale, and must offer a similar interface to the NBN. But I see nothing about forcing them to charge the same as the NBN. I think someone made that bit up.

@Shadow Minister: the NBN is as or more expensive than what we have presently and intending to increase the prices in real terms

On the information we have so far both these assertions are false Shadow. We know it isn't more expensive for all ISP's that currently offer it. And to quote a link you provided earlier http://www.smh.com.au/technology/technology-news/nbn-push-for-rise-in-key-rates-flies-in-face-of-reduction-pledge-20110822-1j6ur.html :

"The cheapest broadband services would not be affected by the proposal because wholesale prices for the lowest-speed connections would be capped at $24 a month for the first five years of the network."

@Shadow Minister: state owned monopoly charges consumers at cost plus an arbitrary profit.

Do you have any evidence for this? When I compare public and private corporations in similar fields (eg Australia Post vs private couriers) I don't see it.

I'd be more inclined to believe you if you weren't so liberal with the truth. The first three assertions you made in this last post were plain wrong. From where I sit they look like bs dreamt up to support an ideological agenda - nothing more. Why on earth would I accept yet another unsupported assertion from you that happens to dovetail neatly with your ideology?

Rstuart,

"That's new. I can't see where the link you gave says that directly" - Because there isn't one.

If you are forced to offer similar prices to all customers incl those to whom your network does not directly cable, i.e. those to whom you have to buy the service from the NBN, it would be a bit of a truism that the discount you can offer to your own network would bankrupt you if you had to offer it to all and sundry.

An example of state owned gouging would be the comparison between Victoria's generation and NSW. Victoria sold off its generation, that now sells its power on the open market. The state owned generation sells it at a higher price to its guaranteed local market.

For all your spin I have yet to see anything that would indicate that prices would be lower under a state owned monopoly. A 5 year freeze on already uncompetitive lower end offering is little comfort in 10 years, when most of the network is rolled out.

@Shadow Minister: it would be a bit of a truism that the discount you can offer to your own network would bankrupt you if you had to offer it to all and sundry.

That makes no sense whatsoever Shadow. Firstly, if someone is buying something from you at $X and reselling it to make a quid, then there is no reason you could not do the same thing. How do you think the industry works now? TPG, iiNet, Internode - they all rent the copper off Telstra. And they sell it cheaper to the end user that Telstra does.

Secondly, it is utterly beside the point. A new market has been created - the local loop. Everyone is free to enter it. What those people can do markets has nothing do with whether the local loop is an open market. I notice you don't whinge at the electricity markets being run in the same way, and in fact you seem to carefully avoid that fact that mechanism used to introduce competition into the electricity market was to break up the generation, retail and distribution in exactly the same way Labor is now doing with data communications.

Thirdly, as far as I am aware structural separation of the industry into local loop providers and retailers is coalition policy as well. This is certainly their plans for Telstra. Are you claiming they are banning competition?

@Shadow Minister: The state owned generation sells it at a higher price to its guaranteed local market.

Do you a reference for this? I've heard claims on the ABC to the contrary. Don't feel bad - I didn't believe them either. It would be nice to get some authoritative information.

Anyway you've elected a liberal government now, so I presume this will change?

@Shadow Minister: For all your spin I have yet to see anything that would indicate that prices would be lower under a state owned monopoly.

I don't think they would be lower Shadow. If you recall the way Telstra's wholesale prices are set are identical to what you are decrying. Telstra hire a floor of lawyers to convince the ACMA their costs are as high as possible, and then ACMA then sets the wholesale price at cost plus a margin. That is pretty much what you are telling me happens with a government monopoly - cost plus. The only difference is the process of determining the cost is more efficient with a government monopoly, as there aren't phalanxes of lawyers involved. And of course Telstra is free to gouge on things not envisaged when the regulation was drawn up, which is exactly what they are doing in the South Brisbane fibre rollout.

You are forgetting the big picture. We aren't building the NBN to lower the costs. We are building the NBN because the private monopoly won't upgrade the network. If all we were trying to do it was introduce competition into the market the NBN wouldn't be needed - just structural separation of Telstra.

" The only difference is the process of determining the cost is more efficient with a government monopoly,"

Absolute rubbish. The costs on both cases are audited. The government monopoly has no incentive to reduce costs. The case of power generation I gave you is a prime example, of how the power stations in the La Trobe valley were making a loss under government ownership and were making a profit under private ownership whilst selling their power at the same real cost.

If the NBN was a simple upgrade, then why the need to remove the old networks, some of which are relatively new and fast?

@Shadow Minister: Absolute rubbish. The costs on both cases are audited.

Are you just making this up as you go along Shadow? I ask because you have returned to your usual habit of making assertions without providing references. When you do that and the assertion aligns with your politics, going on past performance I'd say it has a 50/50% of being pure bs, albeit perhaps not your original bs but something repeated from right wing blogs.

Just to be clear I have provided references saying Telstra hires floors of lawyers to make its case, and I have provided a quote from Malcolm Turnbull saying the relationship between the ACCC and Telstra is nothing short of trench warfare. Clearly this is not an efficient way of doing things, yet here you are claiming that there is no more efficient way for two parties to interact. That sounds like absolute rubbish to me.

@Shadow Minister: The case of power generation I gave you is a prime example

Again, you made those assertions without supporting references. I did ask for them because to put it bluntly without those references I be a fool to believe you. This is not unreasonable. I expect to be treated in the same way, which is why I do give references. Without references the conversation reduces to two people yelling lies at each other. Some may find that entertaining. I don't. I come here to learn.

@Shadow Minister: If the NBN was a simple upgrade, then why the need to remove the old networks

We've been over and over this. Because a private company owns the existing network and it refuses to upgrade it, the only way to upgrade it is to replace it. But the only hope NBN has building a new network for roughly the cost of what we are paying now is if everyone uses it. The way to force that is to decommission the network being replaced.

Rstuart,

Now you're are getting nasty. Compared to the BS you have served up, such as it being more efficient to estimate costs with a government organisation. Where are your links?

All companies books are audited, so I didn't consider that I needed a link for this. The negotiation for regulated rates are hotly contested as they directly affect profits, and there are plenty of non tangibles that can be debated, such as renewal and capital costs, for state owned companies, there is no negotiation, as the costs are passed directly to the consumer with little scrutiny. Easier, but in no way more efficient.

As for Hazelwood, I was doing a masters in Reliability maintenance, and did a study on Hazelwood personally going to the site. In 1995 the plant was losing money hand over fist, was scheduled to be closed in 2005, and employed directly about 1200 people and had an availability of about 75%. The plant now employs about 540 and has an availability of about 85%, and is making a profit. While there are no article directly on this on the net, any search will show that there were massive job losses following privatisation, with and increase in output, which shows massive efficiency gains.

As for your throw away line "Because a private company owns the existing network and it refuses to upgrade it, the only way to upgrade it is to replace it." That is pure drivel. There are plenty of high speed connections, and even if a FO line is run, there is no need to remove the existing line.

The plant I am building has high speed FO lines, and I am forced to pull in copper lines for the fire and other emergency systems, as FO is not considered sufficiently reliable in the case of power failures.

Rstuart,

More food for thought.

http://www.theaustralian.com.au/national-affairs/rudd-guru-slams-nbn-monopoly-as-deal-will-harm-consumers/story-fn59niix-1226137347106

@Shadow Minister: such as it being more efficient to estimate costs with a government organisation.

I am sure both types of organisations can estimate their costs equally well. The difference is it is not in the interests of the owners of a private monopoly to pass that information onto a government regulator, and it is not in their interests of the owners to charge those costs once they have been determined. This is why Telstra hires floors of lawyers to obfuscate and delay the ACCC. In the case of a government organisation the government are the owners, so the problem goes away.

@Shadow Minister: Where are your links?

I've mentioned examples before Shadow. Australia post competes well in the parcel delivery space against private companies, unlike they has a universal service obligation requiring them to cross subsidise, and still pays a dividend to the government http://auspost.com.au/about-us/australia-post-profit.html

Medibank Private is a government organisation providing cheaper rates than its private competitors, generating $3.9 billion in profits in 2009. http://en.wikipedia.org/wiki/Medibank_Private

We've been over this before. It's not private ownership that makes things efficient. It's competition. - the threat that if you aren't efficient you die. If you worship private enterprise as the god of efficiency, you are worshipping a fake god. The appropriate one is competition.

The way to engender competition is to create markets. Which brings us to...

@Shadow Minister: As for Hazelwood,

That is a good news story. But what they did at the same time is restructured the industry, eliminating vertical integration and creating wholesale, retail and delivery markets. Hazlewood either fixed itself or went broke.

@Shadow Minsiter: That is pure drivel.

You say that despite both parties trying to get them to upgrade it, both failing, and the NBN being the result. Your right - there is drivel here somewhere.

@Shadown Minister: There are plenty of high speed connections,

So you have one your house do you? Thought not. You could pay to put it in. Work on several $K per km, plus at least $1K per month to get it connected. The NBN delivers to same thing for $24+GST/mo.

@Shadow Minister: I am forced to pull in copper lines for the fire

Yeah, we've been over this. In my experience fibre is much more reliable. It's not like there aren't batteries that have to be maintained in the system anyway - the fire front panel has them. It a case of old men controlling the regulations I think.

@Shadow Minister: http://www.theaustralian.com.au/national-affairs/rudd-guru-slams-nbn-monopoly-as-deal-will-harm-consumers/story-fn59niix-1226137347106

Is his complaint about how the USO is funded? It seems like he wants it funded more transparently. I not sure how that is relevant to the NBN. The NBN is a mechanism for upgrading the network. The mechanism used to implement USO is independent of that. The article tries to imply there is some ban of competition, but later is forced to acknowledge there isn't.

Rstuart,

I think you are just making this up.

" In my experience fibre is much more reliable" Really? What experience is this? What do you do in the event of a power failure?

"It's not private ownership that makes things efficient. It's competition" Precisely, which is why the NBN is a bad idea. It is hugely anti competition.

" Hazlewood either fixed itself or went broke" - Going broke under state ownership, making a profit under private ownership.

Australia post makes a profit and competes largely because its large infrastructure is government supplied, and so the playing field is far from level.

I do have high speed cable that gave me 25Mb/s except I found that ASDL2+ also gives me 15Mb/s and is cheaper using a different provider.