Clarification

Crikey writes: Re. “PromiseWatch 2013: the NBN and broadband policy” (Tuesday). The PromiseWatch comparison on broadband policy didn’t properly reflect the Coalition’s changed policy in this area. We’re updating this series as more information becomes available; we’ve amended this article with the updated policy information.

Give Gillard some credit

Hugh McCaig writes: Re. “Richard Farmer’s chunky bits” (Friday). It’s been hell for Richard Farmer’s readers in recent times — maybe his negativity peaked this recent mid-week, so one can only hope that Richard Farmer had a period with more open views in that half century before the default position for his “Chunky Bits” became negativity about all things Labor — and in particular Australia’s Prime Minister, Julia Gillard. We’ve had months of it, week after week, with Farmer castigating Gillard for all manner of failings, without any serious attempt at an objective view of the Labor government as it has proceeded on a reform path with real benefits for the country and our people’s future. And Labor has accomplished  significant reforms as  Gillard negotiates her way through the minefield of a minority parliament.

An objective view of Gillard’s work ethic and skill would willingly acknowledge the  following achievements: settling the Murray-Darling Basin fights; establishing a sensible paid-parental scheme; reform of Australia wide school funding; building the NBN; serious work in foreign affairs in the Pacific region, with  Indonesia, China, India and the U.S., besides the all important National Disability Insurance Scheme, not to forget aged care reform. What Crikey readers need in its Chunky Bits regarding politics is a dash of balance and the reality of government.

Coalition broadband v NBN

Bob Lenstra writes: Re. “‘Conroy’s new BFF’ spills on How Fast is the NBN site” (Friday). Both proposals borrow the capital cost.

  • Government borrowings interest rate                            3.95%
  •  FTTP           Capital cost                                                        $37.4bn

Capital finance cost. 37.4* 0.0395                                                $1.48bn/pa

  •   FTTN             Capital cost                                                    $20.4bn

Capital finance cost. 20.4*0.0395                                                $0.81bn/pa

  • FTTN copper maintenance cost(BIS shrapnel)        $0.7bn/pa
  • FTTN cost p/a                                                                           $1.5bn/pa

The big costs per annum are the same for both, at about $1.5 billion per year. Therefore most variables, such cost of various broadband plans, will be the same. Other smaller items of cost and income will be similar for both. The only big variable is the FTTP project completion date being three years later than FTTN. Back-of-the-envelope numbers estimates the additional one off cost to FTTP is about $1 billion. However, FTTN will have to replace the copper sometime in the future. Using constant  figures, this will mean an additional $17 billion

Upon privitasation, how will the market value each proposal? Most likely FTTP will have the greater appeal.

Glen Frost writes: I like James Brotchie’s infographic with animation that compares ALP NBN to LNP NBN. His article in Friday’s Crikey is 100% on the money.

However, the animation is not new: Dr Phil Burgess, group managing director, public policy and communication, Telstra, used a similar animation at a conference I produced in Sydney in 2008: I remember Phil’s presentation as clear as daylight as I thought it demonstrated the benefit of the NBN clearly. Unfortunately, Phil had ripped his trousers, and one journalist covered this (with cartoon) rather than the presentation.

I sold my TLS shares before Sol tanked the financial value of the company, so my interest is purely academic.