NBN chief promises network will be built within eight years – but doubts remain

NBN Co chairman Mike Quigley has used his first public address to confirm the Federal Government’s promise that the national broadband network will be built within eight years.

But his comments have received a mixed reception from telecommunications analysts, who say a lot can change in eight years.

“We’re looking at international data about how fast things can be done and we haven’t moved away from the Government’s commitment to have this job done within eight years,” Quigley told a conference yesterday.

“We need to crank up; obviously, there is a lot of work to be done.”

“I am certainly not saying exactly how long it will take but I see no reason to move away from the Government’s commitment to have the job done in eight years,” Quigley says.

But IBRS Telecommunications analyst Guy Cranswick says the eight year time frame was essentially an election promise based on past realities that doesn’t take current and future changes in to account.

“Eight years is essentially three election cycles away and who’s to say what will change, including technologically.”

“The plan was based on the prediction that the world was developing in a certain way, that has very much changed in the last twelve months. The rebound in the stockmarkets is really holding up a flat and collapsing sector… so you have to ask questions about a cost benefits analysis.”

“This was also based on a prediction of broadband failure which if you look at the figures is not necessarily true.”

Internet phone provider Mynetfone managing director Andy Fung says it would be “naïve” to think the NBN timeframe will remain static.

“Technology and the wider dynamics will be so different in eight years, it’s quite impossible to define any benchmarks of what will happen by then.”

But Quigley rejected Liberal party estimates that NBN end-use charge rates could reach $200, saying access will be “competitively priced”.

“In the end, the reality is we’re going to have to be priced to meet the market,” he says.

“There’s no other way of doing that. Why would a customer move from a service that they have today to a much more expensive service unless they’re getting real value?”

“If there’s real value add in terms of services they’re not getting today, a retail service provider would be able to charge more for that added value – and hence we would be able to have a slightly higher price on wholesale,” Quigley says.

The company aims to largely complete its organisation and recruitment within six months, but has not set a target for when users would first sign up to the $43 billion project.

It will ultimately probably employ “thousands” rather than “tens of thousands” of staff, Quigley says.

Quigley also says the NBN Co will be involved with negotiations between the Government and Telstra about industry reform proposals. He had no further comment on the split.