Conroy says national broadband network will be cheaper than expected

April 29, 2009

The Government’s national broadband network may cost only a quarter of its predicted price and could reach more than the 90% of the population originally expected to access it, Communications Minister Stephen Conroy said yesterday.

In a speech to the National Press Club, Conroy said that it would only be in the “worst case scenario” that the Government would need to spend $22 billion over eight years.

The rest of the funds would come from the National Broadband Network Company, which has been set up by the Government to run the scheme.

“Do we believe we will ever ultimately be up for $22 billion? No,” he said yesterday.

“I’ve had people come to me in the last month and say we think $43 billion is at the top end of what it would cost to build it.”

Conroy described how the Government believes broadband will help the health and education sectors, and dismissed claims that customers could be forced to pay more as “fanciful nonsense”.

Conroy also made note of the fact new technologies are continuing to emerge as the broadband network itself is being built, and says new “splitting” technology could be used to help connect more homes to the network.

“If you would allow me to put my geek hat on, using splitters – rather than nodes – with this new technology you can put on the side of the road can punch you 60 kilometres and still deliver 100Mbps,” he said.

“I know it might surprise you, but I tend to talk about the minimums you can reach. I am usually trying to talk about the minimums rather than the maximums we can deliver. We can reach the 90% comfortably with 100Mbps fibre, and with the new splitters, further.”

But David Kennedy, research director at technology research firm Ovum, says that “splitting technology” would already be used in such a network – unless Conroy is signalling changes to the NBN’s structure.

“In the normal consumer roll-out of fibre to the home, you would be using splitter technology to provide service. A splitter will split the optical signal from one fibre into two. In a suburban installation, a tree is built up out of these splitters. One will be split into two, two into four, etc. One fibre will be used to service up to 64 homes.

“That’s pretty much the normal way to do household FTTH. Conroy…may be thinking about new applications for splitters.”

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