NBN switched on in Kiama

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• On the ground with the NBN rollout: Part 2 - Kiama

Federal communications minister, Stephen Conroy, has switched on the National Broadband Network (NBN) in the south coast NSW community of Kiama, hailing it as a "significant milestone" in the federal government's vision to roll out high-speed broadband nationally.

Senator Conroy was joined by Treasurer Wayne Swan and Mike Quigley, the chief of NBN Co, the company tasked with the rollout, for the start of the customer trial at Kiama.

Senator Conroy paid tribute to Swan who, he said, "has been a believer in the NBN from the first time I took what many have described as a completely lunatic proposal to cabinet".

"Wayne has been there 100 per cent of the time, every step of the way," Conroy said.

He also commended Quigley who, he said, has had "at times a very thankless job".

"It's a testimony to his commitment and belief to what a national broadband network could do for this country, Senator Conroy said.

"This is a very exciting day because it is another significant milestone in the Gillard government's vision to make affordable high speed broadband available to every Australian, no matter where they live in Australia."

The NBN was a "reality" and "gaining momentum across Australia," he said.

More than 2000 homes in Kiama will be connected to high-speed broadband as it joins Armidale in northern NSW as the second mainland site to be switched on to the NBN.

The communities of Townsville, in Queensland, and Willunga and Brunswick, in South Australia, would be connected "shortly", Conroy said.

Telstra, the Commonwealth and the network builder, NBN Co, signed definitive agreements for the rollout of the $35.9 billion scheme in June.

NBN Co plans to provide a fibre-optic cable network to 93 per cent of the population while the remaining seven per cent will have either fixed wireless or satellite broadband over the next decade.

Swan described the NBN as an essential nation-building project.

"As we look at the possibilities of the Asian century, nothing could be more fundamental for our country to maximise the possibilities from that, than not only joining our telecommunications infrastructure together ... but joining us to the rest of the world as well," he said.

The benefits to regional Australia would be "immense" and would flow through to the economy for years to come.

One of the criticisms of the NBN had been that the future could not accurately be foretold, Swan said.

"That is precisely why we must invest in the NBN," he said.

"So that we can tap the unknown possibilities of the future, the known possibilities and the unknown possibilities.

"What we've got to do is tap the great innovative capacities of our people.

"They cannot be tapped at the moment, given the state of our communications infrastructure."

"What is so exciting for our country as this rolls out is that it does mean we are going to be able to continue to compete with the world," Swan continued.

"Whether we live in Sydney, whether we live in Brisbane, whether we live in Cairns, or whether we live in Kiama.

"We aim to see that we will rank in the top five of OECD (Organisation for Economic Co-operation and Development) countries when it comes to using online opportunities."

Senator Conroy rejected suggestions households would have to pay high prices for high-speed broadband, saying the major companies had yet to release their price packages.

Internet retailer Internode released the first pricing plan last week, saying households would pay at least $60 and up to $190 a month for combined phone and internet services on the NBN, depending on what speed they wanted.

"If you look at the capacity that's available on the national broadband network and the restructure of the industry, where we now have a wholesale only company that treats every customer the same, you will see retail competition," Senator Conroy said.

Telstra, Optus, iiNet and Vodafone had yet to reveal their pricing packages, he said.

"I see more exciting retail competition and we all know that more retail competition will lead to lower prices.

NBN Co chief executive Mike Quigley said the NBN could reach peak speeds of 100 megabits per second.

Reports that some connected households had not been able to reach such speeds could be attributed to retail service providers not buying enough capacity and individuals working on older computers, he said.

"The network is capable of 100 megabits a second and we keep testing that to make absolutely sure," he said.

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