Will the NBN be fast enough?

Will the NBN be fast enough?

The new multi billion dollar national broadband network will offer minimum download speeds of 12Mbps – something users can already get with ADSL2+ services.

In April the OECD cited a study which predicted that by 2011 the downstream requirements of European households would peak at around 50Mbps. The federal government's aim for a national broadband network with a minimum speed of 12Mbps - comparable with the current potential of ADSL2+ - is leaving some questioning whether the costly NBN will be fast enough and future proof to see Australia through the next two decades.

Given that cost estimates for the NBN - the largest public infrastructure investment since the Snowy Mountains Scheme - range anywhere from $8 to $25 billion, the potential for consumers to be slugged a higher access price for a service comparable to today's offerings, so that the Commonwealth and the builder can earn a return on their investment, is a distinct possibility.

Shadow communications minister Bruce Billson said that the Rudd government will continue to struggle to turn its election sound bites into sound public policy while it fails to clearly identify the exact problem it is aiming to solve with the NBN.

He said the Howard government's approach to OPEL and regulatory certainty had aimed to make affordable broadband at 12Mbps available to 99 percent of Australians by mid-2009.

"In terms of speed, network scalability is crucial given the long run of any next generation network and evolving data needs: ISPs, call centres, educational institutions, data warehousing and image processing businesses are already concerned that their requirements will exceed the 12Mbs benchmark well before the Rudd Labor Government's plan even makes a start, let alone finishes, which could be 2013 or beyond," Billson told Computerworld.

"In many metropolitan areas, current networks already offer broadband performance exceeding Labor's 12Mbs benchmark and broadband users would be expecting much more for the nearly $5 billion of taxpayer money Labor wants to spend on its behalf."

Telco analyst Paul Budde, of BuddeComm, says Australia should focus on keeping pace with OECD countries, rather than achieving specific speeds that aren't future proof.

"I've just returned from discussions with the EU and their target for 2010 to 2015 is between 20 to 50Mbps and we haven't even started building a 12Mbps network. It could take five or six years before we have that and by that time the rest of the world is already well above 50Mbps," Budde said.

The Arthur D. Little study cited in the OECD report does not take into account the growing use Peer-to-Peer downloading might have, and as an average household calculation, the 50Mbps figure does not include users that would require more than that figure.

Peer-to-Peer downloading, High-Definition TV, VoIP, online gaming, video conferencing and video calls, unified communications, home security and general surfing and downloading are expected to push the average demand per household to 50Mbps downstream and 8Mbps upstream within three years.

An October 2007 OECD study (see slide) into average advertised broadband download speeds by country placed Australia 9th at around 12Mbps, ahead of the US and UK, but behind Japan, Korea, NZ and several Western European countries. But that average is buoyed by metropolitan Australians, while rural and regional inhabitants largely miss out. Plus, the cost to all Australians per MB in excess of their data cap is five times more expensive than any other country.

"What I'm trying to talk with Stephen Conroy about is that we should start looking beyond the NBN - it's not an end point, it's the starting point. If it takes five years to build a 12Mbps network then the gap between us and the rest of the world will continue to grow. We need to benchmark ourselves with other figures in the OECD and the EU, that is what New Zealand has done," Budde said.

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