Mike Quigley had retired from an exemplary career in the telecoms field.
He had succeeded in beating first Leukaemia, then a brain tumor years later and completed a 30 year brilliant career with Alcatel-Lucent in the US, France etc.
Then he was coaxed back to lead the new NBN Co in Australia as their CEO.
After accepting this challenging position, he immediately donated his first year’s salary (A$1.5M) to medical research.
Mike made an impelling and fascinating speech concerning the Australian NBN and NGN’s in general. I warmly recommend you read the transcript:
In both New Zealand and Australia there have been many calls for the publishing of an accurate cost/benefit analysis to justify the taxpayer investment in the UFB and NBN networks.
If you read the New Zealand Herald, you may have seen an excellent article by Chris Barton a couple of days ago.
Chris’ comments are equally applicable to both countries’ critics, and Chris has allowed me to reproduce his very logical piece, mainly for my overseas readers.
The piece is subtitled “Those who call for a cost-benefit analysis of the plan (UFB) don’t understand the Internet“.
Commentators over the last few weeks have argued the government’s ultra fast broadband plan is crying out for “a rigorous cost/benefit analysis” that’s “nowhere to be found”. And that we should be concerned that Telecom might miss out on the government’s $1.5 billion investment. To which there is really only one reply – bollocks.
Of course we want ultra fast broadband. The faster the better. Bring it on at the speed of light and beyond. Those who tut-tut that we can’t justify a fibre optic rollout in cost/benefit terms, or argue that the productivity gains from slow to fast broadband are negligible, betray a terrible lack of understanding of what this thing called the internet is. And what happens when speeds on the greatest goods and services delivery mechanism the world has ever seen get really fast.
The internet is not the web. It’s the tracks that deliver the web, but also a whole lot of other kinds of traffic – music and movie files, software, instant messages, phone calls, video conferencing, streaming audio, fabrication data, computation and heaps of other stuff in a list that goes on for pages.
When you make this traffic flow very fast – and the change from the few megabits per second we currently get on broadband to 100 Mbps proposed is enormous (www.med.govt.nz/templates/ContentTopicSummary____41902.aspx) – something else happens. At high speed the network becomes the computer. And all sorts of other possibilities emerge – dumb devices such as mobile phones or tablets connect to servers on the net and do complex things. The switch to computing in the cloud, computing as a utility, the net computer, or whatever you want to call it, has huge implications for economic development, not to mention surveillance, security and privacy, that we’re only just beginning to realise.
In the face of all this, to call on the crude economic tool of cost/benefit analysis, is just plain silly. Such an analysis would have to take into account so many variables that the model falls over before you even start. It would have to measure, for example, the benefit that accrues from more people making video conference calls instead of travelling to meetings by plane. Or the energy efficiency gains that could be achieved by a community of houses hooked up to a grid network controlling electricity usage. Or the material cost savings from wholly digital versus material (DVD) delivery of movies. Ditto for newspapers, magazines and audio CDs. With cloud computing, storage costs fall too, as all media can reside on the network.
Then there is Telecom which has now belatedly decided it wants to be part of the government’s bold plan – offering to “structurally separate” to do so. Commentators have been quick to argue that to exclude Telecom would be terrible – leading to “a duplication of assets”. But it’s nonsense – Telecom’s assets will still be connected. There will not be two separate networks. By its very nature, the net is an interconnected mesh of copper, hybrid coaxial cable, fibre, and all sorts of other wires, not to mention all manner of wireless frequencies.
In fact, duplication on the network is good thing. The internet is built on multiple paths – a failsafe so that if one path breaks there’s always another route for delivery. As for concerns that “Telecom shareholders would end up with much less value in the two separate companies created by the split”, frankly we don’t care. This is the harsh reality of commerce in the internet age and companies, indeed industries, all over are dealing with the value destruction and opportunity, this new force in businesses brings.
That Telecom now finds itself at “a beggar’s crossroads” is entirely of its own doing. Its arrogant attitude towards consumers, and its refusal over decades to improve the public utility of its monopoly network, is what led to the government stepping in with its broadband investment promise. The government is doing what Telecom refused to do – speeding up the network at a pace that will quickly deliver benefit to all New Zealanders. That’s something it should be commended for, and so far, it has to be said, Communications Minister Steven Joyce is doing a superb job. Not only has he brought Telecom to heel, he’s also signalled a stop to the price gouging by the Vodafone/Telecom mobile duopoly.
The ultra fast broadband initiative doesn’t need Telecom. Telecom needs the new network – which it will have to connect to and pay for the privilege of doing so. That’s a highly desirable situation likely to bring true competition in the delivery of services. There are also plenty of others, like the Regional Fibre Group, (www.nzrfg.co.nz) ready, willing and much more able to deliver what Telecom has for so long failed to do.
As for concerns users won’t migrate quickly enough to give payback, there’s not much to worry about. The new network is like a massive oil reserve discovery deep underground. It takes time and money to tap, but once reached, riches flow. It’s a safe bet the internet will be with us for some time, making the new network a very sound investment – a gusher that will serve up huge benefits for a century or more.
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I would also recommend Paul Budde’s commentary today on the very “nail-biting” situation in Australia. The Australian Federal election in a few days time could have huge consequences for the NBN project.
I met today with Dr David Anderson, National Sector Manager, National Broadband Network at ICN or the Industry Capability Network from Australia, and his Kiwi colleague, Robert Murdoch, Manager, Australian ICN Relationships. The meeting was hosted by NZTE (New Zealand Trade and Enterprise), with my good friend John Houlker present.
ICN is a free service funded by the Australian Government and is truly trans-Tasman, open reciprocally and also freely to New Zealand people and companies.
ICN manages a huge database of some 40.000 companies and individuals based in either Australia or New Zealand with a description of their goods, services and skills. There is a “yellow pages” index and a search feature.
The Australian NBN Company (National Broadband Network) does not deal directly with retail suppliers of goods or services destined for this network. Instead David Anderson and his staff search and vet offers and tender bids. Other departments cover different vocational sectors.
Of course the NBN may disappear in a puff of smoke in 10 days time if the conservative coalition wins the elections. They are under huge criticism for promising to abandon this unique project if elected.
Paul Budde is a recognised Australian expert analyst in matters of telecoms, broadband etc.
I MUST recommend you read his report released tonight, it makes sensible but damning reading.
As we approach the Australian federal elections, the future of NBN (National Broadband Network) is on the chopping block.
I follow passionately the current debate, because the outcome, whichever way it goes, will have major repercussions for Australia’s economy. I have written about this project several times in the past, and am a firm believer in the long-term benefits of the NBN.
Yes the Labour party has accumulated many gaffes during its first mandate, but to kill the NBN (if the opposition wins the upcoming election) is pure folly.
There are so many reactions in the press today, I have just selected a few for those who share the interest in this incredible project with me. I really recommend you check out:
I must be totally P.C. here and state that the views held by the journalists are not necessarily mine!
It would be a fascinating outcome if the NBN gets canned in a few weeks, and good ‘ol New Zealand carries on with the UFB project, pulls it off, and goes to the top of the class!
A week or so ago I was having a quiet drink with several pilot buddies at the Southport Flying Club on the Gold Coast. One of my very long-term acquaintances (a retired heavy jet-jockey) asked me how my fibre-optics occupations were progressing. “Fine” I said, and tried to talk of some of my recent experiences. I was cut short, as he launched into a tirade against “this bloody useless waste of taxpayers money”. “What’s wrong with your broadband connection now, can’t you download movies fast enough”… etc etc. Whoa! I backed off and joined another group around the bar.
Unfortunately I hear and read this all the time. I do my best to explain that copper has just about had it bandwidth-wise, and wireless won’t get us into the global network future. Only fibre has the almost limitless bandwidth capacity that Australia and New Zealand (in fact the world) will require in coming decades and beyond.
Then I saw an excellent article just written here in New Zealand by my friend Ernie Newman, CEO of TUANZ (Telecom Users Association of New Zealand).
I see and chat with Ernie frequently at meetings and conferences. Recently TUANZ and CFH (Crown Fibre Holdings) have teamed up to organise workshops in the major NZ centers to demonstrate to interested parties the evident advantages of the New Zealand UFB Network. (http://www.tuanz.org.nz/content/134e36d1-264e-4c26-afa7-d7a788b88b96.html)
Ernie’s logic applies equally to Australia’s NBN.
Ernie has allowed me to reproduce his article here which follows. Thanks mate!
Relax, says TUANZ chief executive Ernie Newman. NZ’s broadband policy is solid.
By Ernie Newman
4:00 AM Thursday Jul 29, 2010
Brian Fallow can relax – New Zealand’s ultra-fast broadband policy is solid, widely acclaimed internationally, and a critical element in our remaining a first world economy into the 21st century.
Copper wire has been the cornerstone of telecommunications since Bell invented the technology for voice conversations.
Never could he have imagined that 140 years on users would expect the same copper to carry vast amounts of data – emails, videos, scientific content, and radiography images. Engineers have done a wonderful job in stretching its capability for the early years of the internet era.
But copper has done its dash. It can’t cope any longer with the relentless increases in bandwidth new applications demand.
Enter the picture, fibre optic cable with its almost limitless capacity. A fibre bundle the thickness of a broom handle can carry a voice call by everyone on earth simultaneously.
Fibre can ensure the kind of capacity the citizens of 2020 will need and demand to run services in the fields of education, health, energy conservation, and entertainment.
Are these uses here now? Of course not – first we need the connectivity with sufficient critical mass for them to become viable.
That was exactly the dilemma a century ago with the reticulation of electricity. Uptake was initially slow, but mushroomed dramatically during the 1920s as more appliances and uses were invented and commercialised.
Fortunately the leaders of the day had the vision and foresight to take the leap despite not knowing about the microwave, toaster, computer or electric toothbrush. If New Zealanders had waited until every service was available before reticulating electricity, the country would have been held back for decades.
Broadband has similar characteristics. Tomorrow’s families will routinely expect multiple streams of dense content coming into their homes simultaneously. These will include video and other resources from school websites, online medical diagnosis, lifelong education, home security and energy saving systems, and on-demand high-density interactive entertainment.
Businesses will expect productivity-enhancing applications, while government can look forward to major efficiencies in delivery of health and education services.
Such services will encourage more of the brightest and best young New Zealanders to make their lives here rather than migrate.
Fallow quotes liberally from the findings of the Institute for Competition and Regulation. While residing within Victoria University, the institute owes much of its funding and governance to a small cluster of utility companies that are the subject of regulatory controls because of their significant market power.
In 2006 the institute argued stridently against unbundling Telecom’s local loop. Fortunately for New Zealanders its conclusions were rejected by other reputable economists, both overseas and local. Rejected too, by Parliament, which went on to unbundle and thus remove Telecom’s monopoly to the benefit of other telecommunications suppliers and consumers.
That does not mean there is necessarily anything wrong with the institute’s mathematics – just that it fails to run a sanity check across its conclusions. Its work on ultra-fast broadband suffers from a similar weakness.
Economic tools like cost benefit analysis should be used in conjunction with vision and foresight, not as a substitute for them. If cost benefit had been the key determinant, the world might have waited far too long to reticulate electricity, while much exploration and innovation might never have taken place.
As Arthur Grimes has acknowledged in respect of the Motu research referenced in the article, research that is conducted too early for meaningful conclusions to be drawn about the productivity impact should be interpreted with care. Cost benefit analysis is a very blunt instrument where wide ranging strategic projects are involved, he cautioned.
From my observations, New Zealand’s ultra-fast broadband project is recognised globally as world-class. The Government should just get on with the job; future generations will thank it copiously.
* Ernie Newman is chief executive of the Telecommunications Users Association (TUANZ).
By Ernie Newman
Here we await the release of the list of Local Fibre Companies that will partner with Crown Fibre Holdings to start planning the national UFB network.
Somebody mentioned October. Yawn.
I truly prefer the laid-back lifestyle here in New Zealand, but why does everything take so long?
The average workers’ wage differential between Australia and New Zealand just worstened again by another $40 pw. The difference is now colossal.
What has this got to do with Fibre to the Home? Not much, but if we are to install and profit from vastly increased broadband speeds, there has to be an economic structure that keeps good people here, not there!
I’ve been at my home in Australia for a few weeks watching the political wrangling into the next Federal election on 21 August 2010.
The National Broadband Network (NBN) is about number four on the list of important political issues.
Tony Abbott has promised to scrap the NBN if the Liberal-Country Party coalition wins power.
I am not normally a Labour supporter, having been my own boss since 1964.
BUT in this case I would vote for Miss Gillard, just to keep the NBN alive!
It is well advanced (far more than our UFB), with homes already connected to fibre in Tasmania, and many other areas to follow soon.
There is a very strong and politically independent company (NBN Co) which has been formed and is functioning well.
To scrap this would be stupid. So I’m hoping that Gillard gets home. I think she will.
New Zealand?
Ho hum, selection of Local Fibre Companies put back now to seek further information. It really is as exciting as watching grass grow.
I read an article tonight from the Kiwi Sunday Star Times which said:
” Stanners said New Zealand is undertaking the largest transformation of any global industry.
“New Zealand is absolutely leading the world into uncharted territory,” he said. “You can’t look at [UK teleco] BT or any other blueprint.”
Rubbish! It’s slow, it’s not transparent, and we don’t know where it’s going.
I am totally supportive of both countries’ National Broadband network projects.
But NZ is, at least for the interested observer, dragging the chain.
The tall poppy syndrome is seemingly alive and well in New Zealand.
I was surprised to read the following headline today:
“Sky’s hold on TV content worries telcos”
The full article can be found at: http://www.nzherald.co.nz/technology/news/article.cfm?c_id=5&objectid=10654879&ref=newsl_morningnewsdirect_J20080513_133717_5781_6889_875540616
The author falls into the trap of deducing that TV must be distributed as IP packets over a fibre network. This is not true and a far better, simpler and cheaper way of distributing TV, including Freeview and SKY is by using Video overlay or a third ITU standard wavelength (1550 nm) on the single fibre to the home.
SKY has tendered for and paid a lot of money for the rights to distribute much of their programming. Their satellite delivery (DTH or direct to home) has brought TV to many remote homes and areas that would otherwise not receive terrestrial TV broadcasts.
Murdoch and Newscorp Ltd do not control SKY TV NZ. They have a minority shareholding in the company which is publicly traded. SKY only turned it’s first profit after 12 or 13 years of operations in New Zealand.
Why would SKY give over the programming that they have invested in to assist Telcos unless there was a clear profit motive for them?
I just returned from Fibre and Communications conferences in Korea and Singapore. Interesting information concerning IPTV was gleaned from some of my European-based contacts there.
For instance Deutsch Telecom built an IPTV master head-end which reportedly cost the princely sum of €3 Bn (yes, three billion Euros!). I’m not saying it would cost that much in New Zealand, but it is a very expensive exercise.
Orange in France employs 300 full-time staff to manage their IPTV head-end.
So between the existing DTH satellite system and Video overlay for FTTH, there is no need to convert SKY’s transmissions to IP, nor Freeview’s for that matter. IPTV is complex and costly to implement and simply hogs the data channel on FTTH.
Inversely video overlay is extremely inexpensive and simple and can potentially offload several Gbps from the fibre data channel.
Close to home, TransACT in Canberra (http://www.transact.com.au/) has just decided to extend their video overlay TV service coupled with their FTTH offerings in that city. I was pleased to be involved in the technical discussions with TransACT.
I’ve recently had multiple requests from housing estate developers as to what, how, when and where the planned UFB will affect their projects.
Understandably it’s costly and wasteful to install copper phone lines and television distribution systems if the planned fibre can carry the voice, data and video (which it can very easily).
The UFB data released so far from MED and CFH (Crown Fibre Holdings) makes little mention of how subscribers will be connected to the fibre backbone. My emailed enquiries to people who should know remain unanswered.
We have a very interesting Google group around the world linking many people involved with next generation fibre networks and Fibre to the Home. People like Paul Budde and Benoit Felten, (the instigator) regularly exchange information via this group.
Paul set me straight with the following information:
“ The model presented by the government will see it funding core dark fibre infrastructure and the commercial partners funding last-mile connections. Once the backbone is in place the local loop will not, in most cases, constitute a major stumbling block. “
So it will be up to the Local Fibre Companies (once selected) to choose and install the gear to run the last 20km.
As there will probably be quite a number of LFCs chosen, one hopes that there will be some guidelines put into place as to the choice of standards adopted and conscious consideration give to the builders’ and developers’ concerns.
It is quite clear that some clear-language teaching and exchanges will be required between the LFCs and the building industry.
Now that the economic recession and building slump seem to be settling, there will be a new surge in home and apartment building. So let us hope that somebody soon initiates communication between these two groups so as to not waste valuable capital and resources.
More and more, reliable and fast broadband access becomes a must for the traveler.
A week in South Korea, then a week in Japan should have proven a pleasure as we all know that these two countries have the highest densities of fibre broadband delivery in the world.
The Ramada Gangnam Hotel in Seoul provided free broadband access, my only problem getting connected was power adaptors. I travel with three that cover most countries, but somehow Murphy got involved with earthed and earth-less wall sockets, necessitating trips to reception to find a solution.
But once connected surprise! No blazing fast speeds here! As slow as a wet weekend!
And Korea seems to have copied China’s vetting of the net, as several quite innocuous sites were just impossible to access. Anything at all in New Zealand was “hurry up and wait”, and my New Zealand Herald headlines email just wouldn’t let me access the articles via my browser.
I had a couple of hours wait at the Seoul Incheon airport on my way to Tokyo. The business lounge had free WiFi of course, but I had power adaptor problems once more. Once connected, the speed was again very slow. I gave up and went to watch CNN news on a large screen TV. The picture was perfect at first, but as more people came into the lounge and logged online, the picture started to break up, to the point of it becoming unwatchable. (see top pic)
I guessed that the TV signal was delivered as IPTV and as the network ramped up, the available bandwidth just couldn’t cope.
Probably just as well they called my flight then so I left Seoul behind bound for the rising sun.
Any better in Japan? Not really. Two hotels and the airport lounge were all barely better than dialup speeds.
So why? Sure, I only experienced internet access in hotels and airports, not as a single subscriber to a fibre connection. No doubt the available bandwidth is split up, shared between numerous users. An office or home connection could be quite a different experience (and I would hope so).
But this just underlines again that fact that your very fat pipe (ie fibre) won’t get you the bandwidth if the switching capacity of the network behind it is not adequate. It’s the huge water main pipe with just a trickle of water emerging.
And the network is not just your local Ethernet hub, it’s the whole chain right back to and through the big cloud. So as new applications come along demanding more and more bandwidth, it will always be a game of “catch-up” as far as the switching infrastructure is concerned. Conclusion: FTTH is great, but it’s not the only factor in latency and throughput.
All of Asia has a huge aerial mess of wires everywhere. Even tidy Japan shocks with the entanglement of power and comms cables. The motto is “don’t look up”…
The views expressed on this blog are those of the author and do not reflect the views of the owners of SciBlogs.co.nz, the Science Media Centre or the Royal Society of New Zealand
More and more, reliable and fast broadband access becomes a must for the traveler.
So why? Sure, I only experienced internet access in hotels and airports, not as a single subscriber to a fibre connection. No doubt the available bandwidth is split up, shared between numerous users. An office or home connection could be quite a different experience (and I would hope so).