High speed internet costs blow out

THE builder of the national broadband network (NBN) says construction costs will be around 3.9 per cent higher than initially forecast.

NBN Co chief Mike Quigley and communications minister Stephen Conroy released an updated plan today covering the three years to mid-2015.
While construction costs will rise by 3.9 per cent, the plan shows NBN Co is on track to meet its target to start or complete work to connect 758,000 premises to the high speed network by the end of 2012.
Mr Quigley said the plan was based on facts rather than a "bunch of assumptions'' on policy and contracts, compared to the first program drawn up in December 2010.
"It is a much more fact-based, solid set of assumptions ... than it was back in December 2010,'' he told AAP in an interview.
The cost of operating the network is predicted to rise by $3.2 billion to $26.4 billion, while revenue is forecast to be $600 million lower at $23.1 billion.
Although costs have increased, the network is forecast to produce an improved return of 7.1 per cent, up 0.1 per cent.
Mr Quigley linked the rise in costs to the impact of major commercial deals and regulatory delays that had occurred since 2010.
One of the biggest was the deal between NBN Co and Optus, relating to the progressive shutdown of Optus's hybrid fibre-coaxial (HFC) network and the transfer of its customers to the NBN.
Mr Quigley said that deal, approved by the Australian Competition and Consumer Commission (ACCC) last month, would bring around 500,000 HFC subscribers to the NBN.
"We will have a cost of connecting those customers and the cost of the migration fee that we will pay to Optus,'' he said.
As well, a nine-month delay in the ACCC's approval of a Telstra-NBN Co agreement meant the network could not access the Telstra infrastructure it needed to speed up the rollout.
But Mr Quigley said the rollout was still on schedule to pass the 758,000 premises by end 2012, as forecast in March.
Opposition communications spokesman Malcolm Turnbull said delays and blowouts in the next stage of the national broadband network (NBN) project show the federal government has let taxpayers down.
Mr Turnbull said the plan, which updates the initial program laid out in December 2010, showed more investment would come from the Commonwealth.
"Labor's national broadband network is falling disastrously behind every benchmark the government has set for it except one - the amount of taxpayers money being spent,'' he said in a statement.
An increase in "indirect'' operating expenses - primarily staff costs - from $3.7 billion to $7.8 billion was "even more insulting to taxpayers'', Mr Turnbull said.
"NBN Co may not be able to put together a budget or roll out a network, but it knows how to take care of itself,'' he said.
He said NBN Co should be given a definitive budget and stick to it.
"And the Productivity Commission should be asked to conduct a thorough cost benefit analysis to assess the most efficient means of upgrading Australians' broadband as quickly as possible,'' Mr Turnbull said.
Mr Turnbull has said previously a coalition government would deliver broadband services through a cheaper and quicker plan, albeit at slower speeds, through a mix of copper, fibre, wireless and satellite technologies.
NBN Co will deliver fibre-optic cable broadband to 93 per cent of Australia homes, schools and businesses by June 2021.
Of the remainder, four per cent will receive broadband services through fixed-wireless networks and three per cent through satellite services by 2015.

heraldsun.com.au 8 Aug 2012

Another 'Money for Mates' fraudulent deal with government support at the expense of the consumer.

Deals are setup in such a manner that tenures are fraudulently accepted and signed off, with million dollar kickbacks.

The NBN is just one example of government supported fraud, that will NEVER be exposed by the corporate media.