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WIRELESS & NETWORKING / INDUSTRY

NBN Co PR Hacks Raking In Millions Despite Poor Image

By David Richards | Wednesday | 10/04/2013

PR communication hacks and advertising Companies working for the NBN Co are being paid millions to spin a positive message about the roll out of the national broadband network despite cost blow outs, budget over runs and a failure by consumers to sign up for the expensive fibre service that could end up costing $90 billion to build under the current Labor Government.

One Queensland communication Company has scored an $11,715 contract to simply monitor the Facebook pages of the NBN just in case consumers start posting negative messages over a weekend and after 6.00pm..

Under a Coalition plan rolled out yesterday communication costs will be slashed with several PR and communication staff set to be retrenched if the Coalition Government is elected in September according to sources.

Federal Minister Stephen Conroy whose department has approved up to $25 million being spent on spruiking the benefits of the costly NBN roll out has been accused of misleading consumers over the robustness of NBN Co's corporate plan. The Australian newspaper claims that Conroy wrongly suggested on radio recently that the document had been signed off by the Auditor-General.

The Australian later confirmed that the Auditor-General has not in fact audited NBN's corporate plan, signing off only on its annual financial statements.

This month the NBN Co is set to roll out a new round of advertising with $9 million due to be spent this month on new spin doctoring campaigns. The expenditure comes as State Government chase the Labor Federal Government for funding for road projects and new health care facilities.

The $9 million dollars will be spent on television advertising in capital cities and comes after $15 million was spent previously with the Department saying a $24.9 million tax-payer funded splurge was listed at additional estimates for 2012-13 in February. Ironically very few homes in capital cities have had fibre cable laid to their homes because of delays, work having to be redone and fallouts between contractors and the NBN Co.

"Labor's NBN advertising is nothing but politically motivated spin,'' Liberal Senator Simon Birmingham said.

"At least $24 million is being spent advertising a service that virtually no Australians are currently able to access.

''Millions are also being spent on advertising other government programs with department officials saying the ads are crucial to inform the public.

Yesterday as we tipped the  Federal Coalition rolled out a $29 billion plan for an alternative, slower but cheaper National Broadband Network. At a joint press conference Malcolm Turnbull and Tony Abbott launched what could become the new plan for a National Broadband Network across Australia.

But one aspect has brought near-universal approval across the spectrum of industry opinion: the Coalition's decision to go along with the Government in keeping Telstra structurally separated and effectively sidelined from competing head-on with the NBN.

The Coalition may well seek to renegotiate the deal under which Telstra was to dismantle its HFC cable network in major capitals, but the basic deal under which the Government is to progressively pay Telstra $11 billion for its copper wire networks and access to its pits and ducts will remain largely untouched.

- Page Break -

Telstra has made it plain that, whatever happens, it wants its $11 billion, and won't be letting go easily, despite the Coalition's plan to move from a fibre-to-the-premises NBN to fibre-to-the-node, which uses the copper lines to connect the final runs to premises. The carrier would negotiate from a position of strength, with the $11 billion contract already sealed, delivered, and approved by its shareholders - who will want nothing less.

A spokesperson for Telstra said the company would work "constructively with the government of the day" - but added: "We will sit down with the Government to re-negotiate if that is needed. Our position is that we must maintain the value of the current deal for our shareholders."

Some observers and industry players are highly critical of the slower speeds that would be offered to most Australian homes and businesses under the Coalition FttN plan.

While the minimum speed to be offered is put at 25Mbps under the Coalition plan, compared with 12MBps under Labor, Turnbull's plan offers a maximum of 50Mbps, half the Labor plan's 100Mbps current top rate.

And for many users the 50MBps rate would not be reached until 2019, he revealed.

Internode CEO Simon Hackett was one player highly critical of the Coalition plan, predicting that it could wind up costing more money while delivering "inadequate" Internet speeds.

He raised doubts about the Coalition's timetable for a 2019 completion date and said its plan would create a digital divide between those with fibre in their homes and the majority of Australians depending on copper connections.

"[Greenfield developments] will be the ones getting fibre to the home ... so you'll get this incredible divide between what you'll get in McMansions and what you'll get in established suburbs," he said. "If we live in a world where 100 megabits per second isn't enough, all the investment gets thrown away and you have to build the network twice."

The Coalition plan sets a target of 2.8 million premises, or 22 percent, to be FttP fibre-enabled by 2019, with 8.9 million or 71 percent depending on FttN copper connections. The remaining 7 percent would mainly be regional or remote premises on fixed wireless or satellite connections.

The Australian Information Industry Association and the Internet Industry Association issued statements "welcoming" the Coalition policy.

"Our industry is delighted that the Opposition recognises the importance of ubiquitous broadband infrastructure to drive a modern, digital economy," said AIIA CEO Suzanne Campbell.

But she warned: " Guaranteed speeds of 25 to 50Mbps fall far short of the promised 100 megabits per second to be delivered by the current NBN model. While these speeds may be adequate for now, with rapid advances and continuous innovation in ICT capability, there is a very real risk that the needs of business and households will not be met in the future."

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