The Australian government released the National Broadband Network Implementation Study, outlining plans for financing and building the new network. Prepared by McKinsey & Company and KPMG, the report offers the government 84 recommendations on the technology, financing, ownership, policy framework and market structure of the NBN. Stephen Conroy, minister for communications, said in a statement that the report shows the government does not need the participation of incumbent Telstra in order to roll out the NBN. While infrastructure-sharing and commercial cooperation with other operators would benefit the project, the NBN will be financially viable even without the participation of Telstra, according to the government. Telstra has been in talks with the government for several months on selling part of its fixed network assets to the NBN, but the two have been unable to reach an agreement on the price.
The government has also been under pressure from opposition political parties to justify the multi-billion dollar investment in the network. The implementation report suggests that the earlier price tag of AUD 43 billion may be "conservative", and the total capital cost could come out "significantly" lower, the government said. The network is expected to be profitable by year six of its operation, and the government can expect a return on its equity investment sufficient to cover the costs, the report estimates. The public contribution would be an estimated AUD 26 billion in the first seven years, including AUD 18.3 billion over the coming four years. The report authors also recommend that the government keep the network in public hands until the roll-out is completed, to ensure it meets policy objectives.
Other recommendations include an expansion in the planned fibre coverage provided by the NBN to 93 percent of the population from 90 percent, and coverage for 1.3 million premises by 2017-18. The technology would focus on fibre to the premise, with wireless as a supplement, while the open network would offer wholesale access to basic broadband at 20Mbps and voice service for around AUD 30-35 per month. The report is open for public consultation until 27 May, after which the government will take a final decision on the roll-out plans.
