No one will buy an incomplete NBN: Quigley

24 May 2012, 11:25 pm   -   Source: AAP

An incomplete national broadband network (NBN) would have no future buyer, NBN Co boss Mike Quigley says.

An incomplete national broadband network (NBN) would have no future buyer, NBN Co boss Mike Quigley says.

The future for Labor's $36 billion NBN project is uncertain if the coalition wins the next federal election due in late 2013.

Mr Quigley said the government's plan to deliver high-speed fibre optic cable to 93 per cent of Australian homes, schools and businesses only made sense on a "nationwide basis".

"You can't slice it up in pieces, and run a business, and get a return above the government bond rate unless you do it all," he told a budget estimates hearing in Canberra on Thursday.

Opposition communications spokesperson Malcolm Turnbull has said a coalition government would use several technologies including optic fibre, hybrid fibre-coaxial (pay-TV cable), copper, wireless and satellite to provide fast broadband at an affordable price.

Mr Quigley said a business model would not exist if the NBN rollout stopped years earlier than the scheduled 2021 end date.

He said it would be instead on a "complete subsidy basis".

"If you halt the rollout at that point you don't have a business to run," Mr Quigley said.

"You wouldn't find a buyer."

Despite doubt about the network's future post-2013, Mr Quigley said the build was "daily gaining momentum".

He said the assumptions in NBN Co's initial corporate plan had changed since its release in December 2010 due to several factors.

These included when the deal would be completed with Telstra, how NBN Co would implement the competition watchdog's decision on points of interconnect, how to execute the government's policy for new housing estates and other policy matters.

Mr Quigley said NBN Co would submit an updated corporate plan to the government by May 31.

It would be consistent with NBN Co's 12-month and three-year rollout schedules, he said.

More consumers were connecting to faster speeds on the NBN than initially forecast, Mr Quigley said.

He said the highest share of NBN fibre broadband connections, 37 per cent, was for the fastest speed of 100 megabits per second (Mbps) download/40 Mbps upload.

He said 18 per cent had connected on NBN's entry-level speed tier of 12 Mbps download/one Mbps upload.

For 25/5 Mbps it was 35 per cent and 10 per cent for 50/20 Mbps.

"The data for April shows this trend is even stronger, with almost 50 per cent of new active services being on the highest speed tier," he said.

In December 2010, the forecast was for eight per cent of users on 100/40 Mbps and 53 per cent for 12/1 Mbps.

Connections on NBN's three technologies - optic fibre, fixed wireless and satellite - had increased to about 11,000 from 5500 in February, Mr Quigley said.

Work had begun in areas with about 318,000 premises also, he said.

A challenge for NBN Co's planners was the accuracy of existing address files as it impacted on factors such as designing and building the network, and ultimately operating it, he said.

The data inaccuracy meant NBN Co contractors were currently walking down every street in every file to verify addresses.

"This is time consuming, costly and itself prone to error," Mr Quigley said.

Mr Quigley also responded to questions from a letter sent by South Australian Liberal senators Simon Birmingham and Mary Jo Fisher querying the scrutiny of NBN Co at previous estimates hearings.

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