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The NBN Debate Continues-Lessons for India’s NOFN?

Getting Regulation Right Blog Aspect
Dr Archana Gulati
Published Dec 13, 2013
Updated Sep 06, 2023
It is reported that an independent review of NBN ordered by the new Coalition Government of Australia has found that NBN costs and time lines have been understated and revenues overstated. The news report states that,
“‘The  full cost of Labor’s original National Broadband Network plans would blow out by $29 billion and be completed three years late, the strategic review has found.
Communications Minister Malcolm Turnbull released details of the review he started 60 days ago on Thursday.The review found the fibre-to-the-premises NBN under Labor would have cost $73 billion, $29 billion more than forecast, and not be completed until 2024.It also found the current NBN Co corporate plan had overestimated revenues from the network by $13 billion.While the review found the cost and timing of the original plans would blow out, Opposition communications spokesman Jason Clare challenged the review’s findings.He released an internal government analysis of the Coalition’s plans, which he said revealed the new government’s plans were “the wrong approach”, and would not achieve the promised speeds.
Mr Turnbull has pledged download speeds of 50mbps by 2019 under the Coalition’s plan, which will rely on copper connecting to fibre nodes, rather than brining the higher-speed fibre direct to all homes.
But Mr Clare said the analysis should the two stage approach – with 25mbps promised by 2016, expanding to 50mbps by 2019 – was unworkable.
He said the government’s fibre-to-the-node plan would lower revenues from the network by 30% and the actual cost of fixing the existing Telstra-owned copper network, and was “unknown”.
But Mr Turnbull said the review found the Labor network was “never achievable”, and the results of the review would be “a crucial input into government policy”.
Clearly the debate can go on forever. Nevertheless a mid term policy/projectreview and corrective steps are a good idea for any ambitious national broadband network roll out. India’s NOFN/BBNL is already in difficulties. Ironically though it is being heavily subsidized because it is supposed to be financially nonviable and the PSU SPV route was chosen to cut red tape in Right of Way and other such causes of delay; the three PSU implementation partners in charge of this project are now citing the very same reasons for their difficulties and delays. Time for a review of costs and revenue projections and last but not lease scheme design?