Economy

Turnbull announces “strategic review” of National Broadband Network

Patrick Stafford /

The Coalition government has begun the first steps in its shake-up of the National Broadband Network, with Communications Minister Malcolm Turnbull announcing a widespread review of the entire project.

This comes just days after reports the entire board of the NBN Co. had resigned, following the resignation of chief executive Mike Quigley back in July. Turnbull says the resignations came as the project is due for a massive policy shift.

Turnbull yesterday sent an ‘interim statement of expectations’ to NBN Co. The rollout will continue for now and will see homes connected to fibre networks, but a strategic review may have different outcomes altogether.

“The interim statement instructs to continue to rollout the network as rapidly and cost effectively as possible,” Turnbull said at a press conference yesterday. “The interim statement provides NBN Co. the ability to use a wider range of technologies.”

The instructions mean hundreds of thousands of homes could still be connected to fibre networks while the strategic review is undertaken. The strategic review will only commence once a new board has been appointed.

Turnbull also made a note of the NBN targets, which have been downgraded .Turnbull told the ABC last night elements of those projections are still up in the air.

“The approach we’ve described will undoubtedly deliver it sooner and cheaper and more affordably, but the question is how much sooner, how much cheaper and how much more affordably,” he said.

Now, the government has revised its targets to just 729,000 connected homes by June 2014, down from 981,000.

Addressing speculation Turnbull had requested the resignations of the board due to bad performance, he told the ABC this view was “incorrect”.

“I’m not making any judgment about the board, there will be a strategic review of the NBN’s business situation at the moment, and how much is this project really going to cost, how long is it really going to take on the current specifications and what can we do about it?”

The strategic review is not unexpected. The government made its policy on the National Broadband Network clear during the election campaign, although there is still controversy over how the project can change to a fibre-to-the-node network.

Meanwhile, Telstra has already begun talks with the Coalition over how it can renegotiate the company’s $11.2 billion contracts regarding the sale of copper networks.

Telstra chief David Thodey has told shareholders the company won’t accept an unfair contract.

“We decided on the basis of being paid $11.2 billion we were moving on,” Thodey said at a shareholders meeting yesterday.

“The very encouraging thing Malcolm Turnbull said was that he would keep shareholders whole and that means $11.2 billion.

“If they want to change things and do different technology that’s [their] decision, but $11.2 billion means $11.2 billion.”

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Patrick Stafford

Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.

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