Fascinating item in the AFR today (behind paywall) in which the new chief executive of Primus rants about the need for the NBN to do more for phone service.
According to this CEO the NBN only provides for one telephone and to get the existing telephones to work requires "extensive rewiring". That to me is complete and utter nonsense. From the ATA part of the NTU the customer gets exactly the same kind of socket as they get on their existing phones. Connect that up to another socket on the existing wiring - and the phone equivalent of double adaptors are readily available - and all the existing phones will - or at least should - work.
I'd be pleased if some enterprising telecommunications technical bod would tell me if I'm wrong - but I'm pretty sure I'm not.
His second complaint is the $24 access price to get the first service which provides the voice capability and 12/1 of data. He moans that the price needs to be like the "$5" he can get from another provider. Well no - as a non-access network owning provider he can provide voice in one of two ways - buying a ULL and adding voice or buying the Telstra wholesale line rental. The prices for these can be found in the ACCC's final Access Determination. These are $16 per month for the ULL and $22.10 for wholesale line rental. The NBN service includes the ATA which is not included in the ULL price. The NBN price does not result in any additional charges for local calls as occurs for WLR, in addition the provider will receive the PSTN TA charges that currently go to Telstra.
It is a pity that CEOs go out and say these types of things. There is nothing to be gained for the industry by projecting an industry hostility to the NBN - particularly when the statements just don't seem to be accurate.
PS For once I just can't be bothered sending a letter to the AFR. It is about time NBN Co felt mature enough to respond itself.
Novae Meridianae Demetae Dexter delenda est
Showing posts with label NBN Co. Show all posts
Showing posts with label NBN Co. Show all posts
Friday, November 25, 2011
Wednesday, November 23, 2011
Australia Post and the Digital Economy UPDATED
Since Maha Krishnapillai announced that he was leaving Optus everyone has been wondering "where is he going?" We were only told it was a commercial role in a non-competing organisation. Today it has been revealed in CommsDay that he is off to Australia Post.
It was an interesting way to find out - given that the only other news coverage in the AFR and The Register seems to also have been sourced from Comms Day.
The only direct quote from Maha in the story is;
I’m genuinely excited by the transformation opportunity at Australia Post, and the opportunity as part of that in terms of their communications products and services strategy. The thing that really appealed was that [Australia Post CEO] Ahmed Fahour is a really interesting character.
I know the opportunity sounds counter-intuitive to some, because that’s what a lot of people have said to me… ‘are you going back to the public service, is this going back to PMG’? But it’s actually none of those things. It’s a pure commercial role, and that’s what appeals… [to] explore the potential for Australia Post in communications products.
So all we are really told is that the role is "to explore the potential for Australia Post in communications products", to which Maha's new colleagues might say they already do "communications" and what you mean is "telecommunications".
Comms Day goes on to speculate that Post's new strategy will encompass three areas - but how much of this is speculation versus information from Maha is hard to know. But I suggest that if Post was a listed company the CEO and company secretary would be having conniptions right now about the way strategy was being briefed to the market. I suspect (as I mention further below) that the shareholding Ministers in Australia Post might be having them anyway.
But let's assume for a moment that CommsDay is accurately describing the strategy. They say it has three elements;
1. Develop strengths in e-commerce….linked to parcel delivery.
2. Adding to the financial service and banking portfolio.
3. Opportunity to become an SP leveraging “massive distribution, trusted brand, logistics advantages and easy-to-use payment systems”
The first two of these are really better described as Digital Economy initiatives - they are how Post needs to respond to the overall economic transformation that is spurred by the fourth phase (telegraph, telephone, network computing, broadband IP) of the communications revolution. (also see below on history).
I've actually heard from elsewhere that there already is an Australia Post manager who has worked on the model for leveraging posts parcels business and looking for an executive sponsor. Hopefully he and Maha will hook up (and the person who told me that reads this blog so hopefully he'll make sure it happens).
The second area is a bit vague, and there are plenty of reasons why Post should not build its own bank - just as there were when the idea was raised in 1910. The Kiwi post office would also have a view. More importantly why cut off all that agency revenue just to try to make some margin between borrowing and lending.
Australia Post is an interesting case for the whole strategy thing - do you diversify or do you stick to your knitting. I think I've written previously about the strategy bit that said "the railways thought they were in the train business but they are in the transport business" - this is the stuff Telstra has grappled with, are they in the telco biz or the comms biz or in the converged "media comms biz".
Post is in the collecting and delivering business. To do that they've had to have shopfronts. They have leveraged the shopfronts to generate agency fee revenue and to sell products to create demand for the collecting and delivering business - presents, stationary etc. These activities bear some of the fixed and common costs incurred in running stores. The agency business in part grew by accident - as the collection of telephone bill payment went from core PMG business to agency Australia Post business.
There is a great deal of value that AP can add to e-commerce by providing an identification certification business - that could extend to providing to individuals encoded USB sticks that could be used by Centrelink recipients to establish their online credentials.
However it is in the area of actually getting into comms and perhaps seriously considering being a retail Service Provider of the NBN that is a worry. There are plenty of consu;tants (notably Ovum and Venture) promoting the idea of non-telcos getting into the NBN service biz. They all cite Tesco in the UK as a model. But Tesco is a service brand, post is a delivery brand. The bigger value for AP is getting large scale delivery business as part of NBN Co - creating drop points for collection of hardware by installers for example, or guaranteeing delivery of the hardware through offering the kind of "where is my package" service.
But the bigger issue is that AP has two shareholding Ministers who happen to be the shareholding Ministers of NBN Co. To allow AP to get into the RSP business would blow the whole separation plan out of the water.
But, all we really have is CommsDay's speculation that this might be the AP strategy. My sense is that it won't be for long.
(see below)
A history note:
Both Maha and Grahame Lynch in CommsDay touched on the history note of the fact that as the PMG telecoms and post were integrated and whether this is a logical step. They get a bit of the history wrong.
The PMG that was formed in 1901 was simply the amalgamation of pre-existing state based PMGs that existed prior to Federation. The model of an integrated post - telegraph - telephone behemoth dates from the middle of the preceding century. How the PTT model evolved in the European countries and their colonies varies from place to place - but Eli Noam in Telecommunications in Europe proposes the position that revenue from the monopoly "royal mail" in all European states was one source of revenue that was not subject to Parliamentary approval. Preservation of that monopoly was paramount and extending the post office role to the telegraph and then telephone was a process of preserving the monopoly and its rents.
In the Australian context the newly Federated Post Office did not operate at all well in its initial years (a position that in part was built on interstate rivalries that remained in Telecom until the Divisionalisation move of 1987). This resulted in a Royal Commission that reported in 1910. The report and its record of evidence make interesting reading, not least because the issue faced was that the PMG was restricted to be able to spend only as much on capital as it could raise from revenue in each year - there were no "taxpayers funds" employed.
The other was that it was the postal service that was profitable. Indeed within the two loss making services the Director-General of the Service Robert Townley Scott revealed in his evidence;
Q:Then the telegraph and telephone systems are non-payable?
A:I do not think the telephones are non-payable. Sometimes a very considerable profit is made on the lines run on the condenser system.
Q: Generally speaking, the telephone system is a payable one?
A: Yes, with regard to the trunk lines and condenser system.
Q: what is to stop the Department from further reducing the telephone rates?
A: I think that would be a mistaken policy. Take a case in point. One can speak by telephone over a distance for 2 [pennies] for three minutes, which would cost one [shilling = 12 pennies] by telegram. (Paragraphs 358-360 Interestingly the evidence at this point goes into Scott's proposal for a Post Office Savings Bank).
The Post Office never received much taxpayer money, and from 1959 on it only received Government funds as loans. When the Post Office was split into Australia Post and Telecom Australia in 1975 a basis of it was that the former was a labour intensive business while the latter was a capital intensive one.
{This para has been amended} Grahame Lynch writes that "international services were excluded" when telecom and post were formed in 1975. This construction could give the impression that the international services were part of the PMG at that time. Instead the history of overseas telecommunications is far richer. OTC was formed in 1946 when the previously privately held assets of AWA and Cable & Wireless were nationalised. It was a recommendation of the Vernon Commission into the Post Office in 1974 that OTC be merged with Telecom, but OTC saw off that threat. The story of the final merger of Telecom and OTC has really only been half told - Professor Steve Burdon at UTS threatens to write a tell all book one day.
Finally the carrying value - that is cumulative unrecovered funds - invested in Telstra before it was privatised for some $60B was precisely zero.
For avoidance of doubt, I think CommsDay did a brilliant job in getting this scoop. I have referred to the AP strategy as being "speculation" on CommsDay's part since they preceded it "CommsDay understands". However, I assume, like every other reader would, that CommsDay actually got this from Maha. I do think that that is a strange way for AP to brief its strategy to the media, and I do wonder what the shareholding Ministers would think of AP being an RSP.
Also the history note says that CommsDay gets the history "wrong". While there was one specific error (since amended) the import of this note is that the relevant history is far more interesting and richer than the potted version provided by CommsDay would suggest.
Novae Meridianae Demetae Dexter delenda est
It was an interesting way to find out - given that the only other news coverage in the AFR and The Register seems to also have been sourced from Comms Day.
The only direct quote from Maha in the story is;
I’m genuinely excited by the transformation opportunity at Australia Post, and the opportunity as part of that in terms of their communications products and services strategy. The thing that really appealed was that [Australia Post CEO] Ahmed Fahour is a really interesting character.
I know the opportunity sounds counter-intuitive to some, because that’s what a lot of people have said to me… ‘are you going back to the public service, is this going back to PMG’? But it’s actually none of those things. It’s a pure commercial role, and that’s what appeals… [to] explore the potential for Australia Post in communications products.
So all we are really told is that the role is "to explore the potential for Australia Post in communications products", to which Maha's new colleagues might say they already do "communications" and what you mean is "telecommunications".
Comms Day goes on to speculate that Post's new strategy will encompass three areas - but how much of this is speculation versus information from Maha is hard to know. But I suggest that if Post was a listed company the CEO and company secretary would be having conniptions right now about the way strategy was being briefed to the market. I suspect (as I mention further below) that the shareholding Ministers in Australia Post might be having them anyway.
But let's assume for a moment that CommsDay is accurately describing the strategy. They say it has three elements;
1. Develop strengths in e-commerce….linked to parcel delivery.
2. Adding to the financial service and banking portfolio.
3. Opportunity to become an SP leveraging “massive distribution, trusted brand, logistics advantages and easy-to-use payment systems”
The first two of these are really better described as Digital Economy initiatives - they are how Post needs to respond to the overall economic transformation that is spurred by the fourth phase (telegraph, telephone, network computing, broadband IP) of the communications revolution. (also see below on history).
I've actually heard from elsewhere that there already is an Australia Post manager who has worked on the model for leveraging posts parcels business and looking for an executive sponsor. Hopefully he and Maha will hook up (and the person who told me that reads this blog so hopefully he'll make sure it happens).
The second area is a bit vague, and there are plenty of reasons why Post should not build its own bank - just as there were when the idea was raised in 1910. The Kiwi post office would also have a view. More importantly why cut off all that agency revenue just to try to make some margin between borrowing and lending.
Australia Post is an interesting case for the whole strategy thing - do you diversify or do you stick to your knitting. I think I've written previously about the strategy bit that said "the railways thought they were in the train business but they are in the transport business" - this is the stuff Telstra has grappled with, are they in the telco biz or the comms biz or in the converged "media comms biz".
Post is in the collecting and delivering business. To do that they've had to have shopfronts. They have leveraged the shopfronts to generate agency fee revenue and to sell products to create demand for the collecting and delivering business - presents, stationary etc. These activities bear some of the fixed and common costs incurred in running stores. The agency business in part grew by accident - as the collection of telephone bill payment went from core PMG business to agency Australia Post business.
There is a great deal of value that AP can add to e-commerce by providing an identification certification business - that could extend to providing to individuals encoded USB sticks that could be used by Centrelink recipients to establish their online credentials.
However it is in the area of actually getting into comms and perhaps seriously considering being a retail Service Provider of the NBN that is a worry. There are plenty of consu;tants (notably Ovum and Venture) promoting the idea of non-telcos getting into the NBN service biz. They all cite Tesco in the UK as a model. But Tesco is a service brand, post is a delivery brand. The bigger value for AP is getting large scale delivery business as part of NBN Co - creating drop points for collection of hardware by installers for example, or guaranteeing delivery of the hardware through offering the kind of "where is my package" service.
But the bigger issue is that AP has two shareholding Ministers who happen to be the shareholding Ministers of NBN Co. To allow AP to get into the RSP business would blow the whole separation plan out of the water.
But, all we really have is CommsDay's speculation that this might be the AP strategy. My sense is that it won't be for long.
(see below)
A history note:
Both Maha and Grahame Lynch in CommsDay touched on the history note of the fact that as the PMG telecoms and post were integrated and whether this is a logical step. They get a bit of the history wrong.
The PMG that was formed in 1901 was simply the amalgamation of pre-existing state based PMGs that existed prior to Federation. The model of an integrated post - telegraph - telephone behemoth dates from the middle of the preceding century. How the PTT model evolved in the European countries and their colonies varies from place to place - but Eli Noam in Telecommunications in Europe proposes the position that revenue from the monopoly "royal mail" in all European states was one source of revenue that was not subject to Parliamentary approval. Preservation of that monopoly was paramount and extending the post office role to the telegraph and then telephone was a process of preserving the monopoly and its rents.
In the Australian context the newly Federated Post Office did not operate at all well in its initial years (a position that in part was built on interstate rivalries that remained in Telecom until the Divisionalisation move of 1987). This resulted in a Royal Commission that reported in 1910. The report and its record of evidence make interesting reading, not least because the issue faced was that the PMG was restricted to be able to spend only as much on capital as it could raise from revenue in each year - there were no "taxpayers funds" employed.
The other was that it was the postal service that was profitable. Indeed within the two loss making services the Director-General of the Service Robert Townley Scott revealed in his evidence;
Q:Then the telegraph and telephone systems are non-payable?
A:I do not think the telephones are non-payable. Sometimes a very considerable profit is made on the lines run on the condenser system.
Q: Generally speaking, the telephone system is a payable one?
A: Yes, with regard to the trunk lines and condenser system.
Q: what is to stop the Department from further reducing the telephone rates?
A: I think that would be a mistaken policy. Take a case in point. One can speak by telephone over a distance for 2 [pennies] for three minutes, which would cost one [shilling = 12 pennies] by telegram. (Paragraphs 358-360 Interestingly the evidence at this point goes into Scott's proposal for a Post Office Savings Bank).
The Post Office never received much taxpayer money, and from 1959 on it only received Government funds as loans. When the Post Office was split into Australia Post and Telecom Australia in 1975 a basis of it was that the former was a labour intensive business while the latter was a capital intensive one.
{This para has been amended} Grahame Lynch writes that "international services were excluded" when telecom and post were formed in 1975. This construction could give the impression that the international services were part of the PMG at that time. Instead the history of overseas telecommunications is far richer. OTC was formed in 1946 when the previously privately held assets of AWA and Cable & Wireless were nationalised. It was a recommendation of the Vernon Commission into the Post Office in 1974 that OTC be merged with Telecom, but OTC saw off that threat. The story of the final merger of Telecom and OTC has really only been half told - Professor Steve Burdon at UTS threatens to write a tell all book one day.
Finally the carrying value - that is cumulative unrecovered funds - invested in Telstra before it was privatised for some $60B was precisely zero.
For avoidance of doubt, I think CommsDay did a brilliant job in getting this scoop. I have referred to the AP strategy as being "speculation" on CommsDay's part since they preceded it "CommsDay understands". However, I assume, like every other reader would, that CommsDay actually got this from Maha. I do think that that is a strange way for AP to brief its strategy to the media, and I do wonder what the shareholding Ministers would think of AP being an RSP.
Also the history note says that CommsDay gets the history "wrong". While there was one specific error (since amended) the import of this note is that the relevant history is far more interesting and richer than the potted version provided by CommsDay would suggest.
Novae Meridianae Demetae Dexter delenda est
Wednesday, September 21, 2011
When will parliament catch-up
So the NBN joint house committee met last night. I didn't tune in - Tuesday night is bridge night and that is very important for my mental well-being.
Ry Crozier did an excellent job of commentary on the proceedings which has made me wish I could review it myself. But Hansard takes time to type up (for committees, never for the Parliament itself ... why is that?). But in this day and age you wonder why the Parliamentary website can't actually store a file of the proceedings that was broadcast. It would certainly be consistent with the ambitions inherent in the Digital Economy strategy.
Meanwhile I'll have to hold off on providing further comments - though from Ry's tweets the coalition members again made a complete hash of the proceedings.
The biggest news though was the committee winding up early because an NBN co progress report was unavailable. The delay appears to be caused by the Departmental officers not being prepared to release the report till they could verify the information following receipt of audited financials.
This reflects a general public service misunderstanding of the role of audits. Audits don't guarantee the accuracy of financial reports. They do two things. They use statistical sampling to check whether there are systemic errors, and they audit processes to ensure that data is captured. It is extremely rare for financial results to be amended as a consequence of an audit.
Furthermore there is no risk in releasing data based upon the company's own results data even if that needed to be qualified as being unaudited. The focus of the progress report was certainly more appropriately focussed on the non-financial milestones anyway. The financial results are just going to show a huge capital spend with little revenue - just like any large infrastructure project.
It is a pity. There are some good people in that part of DBCDE. They can and should do better than that.
Novae Meridianae Demetae Dexter delenda est
Ry Crozier did an excellent job of commentary on the proceedings which has made me wish I could review it myself. But Hansard takes time to type up (for committees, never for the Parliament itself ... why is that?). But in this day and age you wonder why the Parliamentary website can't actually store a file of the proceedings that was broadcast. It would certainly be consistent with the ambitions inherent in the Digital Economy strategy.
Meanwhile I'll have to hold off on providing further comments - though from Ry's tweets the coalition members again made a complete hash of the proceedings.
The biggest news though was the committee winding up early because an NBN co progress report was unavailable. The delay appears to be caused by the Departmental officers not being prepared to release the report till they could verify the information following receipt of audited financials.
This reflects a general public service misunderstanding of the role of audits. Audits don't guarantee the accuracy of financial reports. They do two things. They use statistical sampling to check whether there are systemic errors, and they audit processes to ensure that data is captured. It is extremely rare for financial results to be amended as a consequence of an audit.
Furthermore there is no risk in releasing data based upon the company's own results data even if that needed to be qualified as being unaudited. The focus of the progress report was certainly more appropriately focussed on the non-financial milestones anyway. The financial results are just going to show a huge capital spend with little revenue - just like any large infrastructure project.
It is a pity. There are some good people in that part of DBCDE. They can and should do better than that.
Novae Meridianae Demetae Dexter delenda est
Monday, September 19, 2011
NBN price plans
It is extraordinary how much focus individual NBN price plans are receiving in the market. The only thing more extraordinary is the diverse commentary.
The release of iiNet's plans had itWire writing "Anyone who thought that NBN would bring ubiquitous cheap broadband to Australia may have had their hopes dashed with the announcement of the new offerings from iiNet." They went on to say though "Although cheaper than its DSL offerings, iiNet's NBN starting price is still a hefty $50 for just 12Mbps download and 1 Mbps upload, with a 20GB peak and 20GB off-peak quota."
iTnews saw it more as "iiNet undercuts rivals with retail NBN prices", whereas ZDnet focussed on the comparison with Internode.
Meanwhile Delimiter took the differential even further asserting "Internode must slash its horrible NBN pricing."
The level of focus is frightening when these providers are all competing for a few tens of thousand customers today in a market that is renowned for the dynamism within which prices and plans are constructed and changed.
The only certainty really is that entry level prices are at or below the comparable ADSL services, with better speed reliability and likely better service support. And that's without mentioning some of the lower price offerings from telcos that an MP saw fit to disparage in a parliamentary speech.
If I'm not much mistaken Malcolm Turnbull has already ditched the "the NBN will be dearer" story.
What happens next?
Novae Meridianae Demetae Dexter delenda est
The release of iiNet's plans had itWire writing "Anyone who thought that NBN would bring ubiquitous cheap broadband to Australia may have had their hopes dashed with the announcement of the new offerings from iiNet." They went on to say though "Although cheaper than its DSL offerings, iiNet's NBN starting price is still a hefty $50 for just 12Mbps download and 1 Mbps upload, with a 20GB peak and 20GB off-peak quota."
iTnews saw it more as "iiNet undercuts rivals with retail NBN prices", whereas ZDnet focussed on the comparison with Internode.
Meanwhile Delimiter took the differential even further asserting "Internode must slash its horrible NBN pricing."
The level of focus is frightening when these providers are all competing for a few tens of thousand customers today in a market that is renowned for the dynamism within which prices and plans are constructed and changed.
The only certainty really is that entry level prices are at or below the comparable ADSL services, with better speed reliability and likely better service support. And that's without mentioning some of the lower price offerings from telcos that an MP saw fit to disparage in a parliamentary speech.
If I'm not much mistaken Malcolm Turnbull has already ditched the "the NBN will be dearer" story.
What happens next?
Novae Meridianae Demetae Dexter delenda est
Tuesday, September 06, 2011
"reflective of a lazy regulatory attitude" AAPT and NBN Co
I am generally an NBN fan. I am a fan of the concept of an FTTN network, I am a fan of the structural separation it delivers and I am a fan of the idea of a Government enterprise delivering it.
There is no real foundation for the perception that Government enterprises are less efficient and effective than private sector ones. A colleague has kindly recently made some observations on submissions to the Domestic Transmission Capacity service FAD.
The first by private sector firm AAPT. The colleague described it as "a whole new level of pathetic" and said that the submissions in general were "reflective of a lazy regulatory attitude."
The second is by NBN Co. This is neatly described as "a metaphor for the entire organisation...5 pages with nothing on it, then 2.5 pages with very little of any substance on it...8 pages that could be condensed into 1 page." and adds "Wasting paper, wasting money..."
I do note however the reassuring words from NBN Co on the second page of their submission,
Environment
NBN Co asks that you consider the environment before printing this submission.
Going to my earlier comments about corporations losing the plot on communications. If you want to save the environment come up with document templates that do so. The cover detail could be on the same page as the bit with the notice, it didn't need an intentionally blank page and it didn't need the superflous colourful back page.
There is a longer story to write about what creates this environment, but in brief, we have reached that stage in a regulated industry wherein the regulatory process is now no longer strategic.
The logical move is a massive restructure of regulatory institutions. The structural separation has been used to allow people to assume their problems are over. The reality is they have only just begun, but have very little to do with NBN prices and everything to do with bundling.
Novae Meridianae Demetae Dexter delenda est
There is no real foundation for the perception that Government enterprises are less efficient and effective than private sector ones. A colleague has kindly recently made some observations on submissions to the Domestic Transmission Capacity service FAD.
The first by private sector firm AAPT. The colleague described it as "a whole new level of pathetic" and said that the submissions in general were "reflective of a lazy regulatory attitude."
The second is by NBN Co. This is neatly described as "a metaphor for the entire organisation...5 pages with nothing on it, then 2.5 pages with very little of any substance on it...8 pages that could be condensed into 1 page." and adds "Wasting paper, wasting money..."
I do note however the reassuring words from NBN Co on the second page of their submission,
Environment
NBN Co asks that you consider the environment before printing this submission.
Going to my earlier comments about corporations losing the plot on communications. If you want to save the environment come up with document templates that do so. The cover detail could be on the same page as the bit with the notice, it didn't need an intentionally blank page and it didn't need the superflous colourful back page.
There is a longer story to write about what creates this environment, but in brief, we have reached that stage in a regulated industry wherein the regulatory process is now no longer strategic.
The logical move is a massive restructure of regulatory institutions. The structural separation has been used to allow people to assume their problems are over. The reality is they have only just begun, but have very little to do with NBN prices and everything to do with bundling.
Novae Meridianae Demetae Dexter delenda est
Telstra ongoing embarrassment from its CEDA foray - Updated
One of the observations Dr Phil Burgess made to me about Australia was the lack of engagement by Australian business in political debate. He set about changing that.
Most particularly he made it clear to think tanks and research institutes that he was only interested in funding organisations that supported the views that Telstra espoused.
The Committee for the Economic Development of Australia (CEDA) was one body that heard the message. CEDA commissioned a report that was ultimately released as Growth 60: Australia's Broadband Future - Four doors to greater competition. It is not totally available on line but many libraries have copies.
I am not suggesting that CEDA was funded by Telstra to undertake the research, however the bulk of the contributors were at some stage paid by Telstra for writing similar pieces elsewhere.
Confusingly the CEDA link to the report dates it as "Wednesday, November 18, 2009", however, the one chapter available online dates the report as 2008. The introduction also refers to "current policy" as FTTN to 98% of the population.
Having been in the audience for the launch (and at one stage considered as one of the authors) I know the report was released at the time of the conclusion of tenders for NBN 1.0 in November 2008.
This date is supported by the excellent review by Stuart Corner. He noted;
Leading economic think tank CEDA (Committee for Economic Development of Australia) has criticised the Federal Government's obsession with building the National Broadband Network, saying a subsidised $4.7 billion FTTN rollout is unnecessary. CEDA's report, Australia’s Broadband Future: Four doors to greater competition, maintains that focussing on FTTN to the exclusion of competing access methods will decrease competition.
The CEDA report contains six chapters written by eminent economic researchers, all of whom argue among other things excessive regulation and structural separation of Telstra is unwise, while the promotion of competing access networks including cable, copper and wireless would provide the necessary competitive marketplace.
Yet CEDA as recently as April 2011 has been peddling this report as if it is informative about the current policy position.
This is compounded by the fact that the AFR continues to use the report's commissioner, Michael Porter, to write opinion editorial pieces on the NBN; the latest offering is Fibre rollout wastes billions. These pieces ignore the reality of what happened in the NBN 1.0 tender and make fanciful and inaccurate technical claims.
I will move to a systematic response to the column in a moment. My first point is though that CEDA and Porter's interest in this matter was spurred when Telstra wanted NBN 1.0 stopped. In particular Telstra did not want any solution that involved their structural separation - the key reason they declined to bid.
Now Telstra's position is totally different. They would like to get on with their business and deploying NBN 2.0 is what they want to achieve. David Thodey has made it clear that shareholders should not vote on the NBN and separation deals on the assumption that there is an alternative policy. It might be worthwhile for Telstra to have another quiet chat with CEDA.
Moving to Porter, he asserts that "by avoiding fibre overbuild in metropolitan and regional areas, HFC can indirectly finance up to $20 to $30 billion of NBN savings."
This assertion simply does not stand up to scrutiny. HFC exists mostly only in metropolitan areas, there is very little in regional areas. HFC passes somewhere around 70% of Australian households, but it is a well known fact that it has extremely low penetration into multi-dwelling units. That is a technological limitation due to the difficulty of feeding a whole coax cable into existing spaces.
The total NBN construction cost of $43B includes the cost of the satellite and wireless solutions. The implementation study provided detail (below) of the cost per premise connected by percentile.
Even if we assumed that HFC did cover 70% of households, these are the households it costs $2 to $3K to connect. It is noteworthy that it was this analysis that saw the FTTP footprint extended to 93% from 90%. That means that Porter's upper bound of saving $30B, being three-quarters of the capital cost, is totally beyond reach. $20B may be reasonable to estimate the amount of capital not spent.
But here's the other problem - the outcome is not comparable. The 100Mbps speeds being quoted for HFC are shared speeds - not what is available to each premise. To provide a comparable service over the life of the asset requires additional investment. Further, as mentioned above, HFC simply is not available at all the premises it passes.
Porter asserts
Most independent experts would prefer NBN Co to request tenders by location and speed, not technology. Regional markets, with support from the private and public sectors, could sort and blend bids and technologies, and deliver content competition.
and concludes
To be commercially viable, NBN Co should invite all parties to bid to build upgraded and expanded cable, wireless and fibre in metropolitan areas. It will then start to have a better balance sheet owing to savings on fibre rollout - estimated at well over $20B.
The difficulty is that neither Telstra nor Optus - the owners of the two big HFC networks - have any interest at all in this strategy. It doesn't deliver comparable service and does not defer forever the need for a fibre to the home investment.
It is interesting to note that Porter's latest contribution only credits his university post. It is unclear from the CEDA site whether he is still also CEDA National Director Research and Policy. (Update - I have been informed that Porter is no longer with CEDA. His replacement is Nathan Taylor, Chief Economist). CEDA could profitably leave its 2008 report - properly dated - on its website and delete the more recent blathering.
Novae Meridianae Demetae Dexter delenda est
Most particularly he made it clear to think tanks and research institutes that he was only interested in funding organisations that supported the views that Telstra espoused.
The Committee for the Economic Development of Australia (CEDA) was one body that heard the message. CEDA commissioned a report that was ultimately released as Growth 60: Australia's Broadband Future - Four doors to greater competition. It is not totally available on line but many libraries have copies.
I am not suggesting that CEDA was funded by Telstra to undertake the research, however the bulk of the contributors were at some stage paid by Telstra for writing similar pieces elsewhere.
Confusingly the CEDA link to the report dates it as "Wednesday, November 18, 2009", however, the one chapter available online dates the report as 2008. The introduction also refers to "current policy" as FTTN to 98% of the population.
Having been in the audience for the launch (and at one stage considered as one of the authors) I know the report was released at the time of the conclusion of tenders for NBN 1.0 in November 2008.
This date is supported by the excellent review by Stuart Corner. He noted;
Leading economic think tank CEDA (Committee for Economic Development of Australia) has criticised the Federal Government's obsession with building the National Broadband Network, saying a subsidised $4.7 billion FTTN rollout is unnecessary. CEDA's report, Australia’s Broadband Future: Four doors to greater competition, maintains that focussing on FTTN to the exclusion of competing access methods will decrease competition.
The CEDA report contains six chapters written by eminent economic researchers, all of whom argue among other things excessive regulation and structural separation of Telstra is unwise, while the promotion of competing access networks including cable, copper and wireless would provide the necessary competitive marketplace.
Yet CEDA as recently as April 2011 has been peddling this report as if it is informative about the current policy position.
This is compounded by the fact that the AFR continues to use the report's commissioner, Michael Porter, to write opinion editorial pieces on the NBN; the latest offering is Fibre rollout wastes billions. These pieces ignore the reality of what happened in the NBN 1.0 tender and make fanciful and inaccurate technical claims.
I will move to a systematic response to the column in a moment. My first point is though that CEDA and Porter's interest in this matter was spurred when Telstra wanted NBN 1.0 stopped. In particular Telstra did not want any solution that involved their structural separation - the key reason they declined to bid.
Now Telstra's position is totally different. They would like to get on with their business and deploying NBN 2.0 is what they want to achieve. David Thodey has made it clear that shareholders should not vote on the NBN and separation deals on the assumption that there is an alternative policy. It might be worthwhile for Telstra to have another quiet chat with CEDA.
Moving to Porter, he asserts that "by avoiding fibre overbuild in metropolitan and regional areas, HFC can indirectly finance up to $20 to $30 billion of NBN savings."
This assertion simply does not stand up to scrutiny. HFC exists mostly only in metropolitan areas, there is very little in regional areas. HFC passes somewhere around 70% of Australian households, but it is a well known fact that it has extremely low penetration into multi-dwelling units. That is a technological limitation due to the difficulty of feeding a whole coax cable into existing spaces.
The total NBN construction cost of $43B includes the cost of the satellite and wireless solutions. The implementation study provided detail (below) of the cost per premise connected by percentile.
Even if we assumed that HFC did cover 70% of households, these are the households it costs $2 to $3K to connect. It is noteworthy that it was this analysis that saw the FTTP footprint extended to 93% from 90%. That means that Porter's upper bound of saving $30B, being three-quarters of the capital cost, is totally beyond reach. $20B may be reasonable to estimate the amount of capital not spent.
But here's the other problem - the outcome is not comparable. The 100Mbps speeds being quoted for HFC are shared speeds - not what is available to each premise. To provide a comparable service over the life of the asset requires additional investment. Further, as mentioned above, HFC simply is not available at all the premises it passes.
Porter asserts
Most independent experts would prefer NBN Co to request tenders by location and speed, not technology. Regional markets, with support from the private and public sectors, could sort and blend bids and technologies, and deliver content competition.
and concludes
To be commercially viable, NBN Co should invite all parties to bid to build upgraded and expanded cable, wireless and fibre in metropolitan areas. It will then start to have a better balance sheet owing to savings on fibre rollout - estimated at well over $20B.
The difficulty is that neither Telstra nor Optus - the owners of the two big HFC networks - have any interest at all in this strategy. It doesn't deliver comparable service and does not defer forever the need for a fibre to the home investment.
It is interesting to note that Porter's latest contribution only credits his university post. It is unclear from the CEDA site whether he is still also CEDA National Director Research and Policy. (Update - I have been informed that Porter is no longer with CEDA. His replacement is Nathan Taylor, Chief Economist). CEDA could profitably leave its 2008 report - properly dated - on its website and delete the more recent blathering.
Novae Meridianae Demetae Dexter delenda est
Monday, September 05, 2011
Communications and Stakeholders - Part 2
It was way back in 2003 that I think I first formally tried to catalogue a firm's stakeholder matrix and start capturing details of engagements and strategies.
I tried to maintain it as a Word table but it was unwieldy, hard to update, hard to extract from and hard to establish linkages (e.g. which stakeholders did other stakeholders listen to).
Simple CRM software would help a little, being a purpose configured database.
I'm fascinated to see the development of a number of specific tools such as StakeTracker, EngagementHQ, Stakeholder Circle, Consultation Manager, and Darzin.
Many of these are more designed for stakeholder engagement on particular projects - the field more technically known as community consultation.
There is even an The International Association for Public Participation - Australasia.
The relevance? Well as already noted here NBN Co has recognised its community consultation task. The reality is it has the same consultation task to face 100s of times over - the stakeholders will sometimes be local and sometimes regional, state or national.
But I continue to despair of whether "stakeholder" is defined broadly enough in the industry given the staff announcement issues at NBN Co and Intenode.
Novae Meridianae Demetae Dexter delenda est
I tried to maintain it as a Word table but it was unwieldy, hard to update, hard to extract from and hard to establish linkages (e.g. which stakeholders did other stakeholders listen to).
Simple CRM software would help a little, being a purpose configured database.
I'm fascinated to see the development of a number of specific tools such as StakeTracker, EngagementHQ, Stakeholder Circle, Consultation Manager, and Darzin.
Many of these are more designed for stakeholder engagement on particular projects - the field more technically known as community consultation.
There is even an The International Association for Public Participation - Australasia.
The relevance? Well as already noted here NBN Co has recognised its community consultation task. The reality is it has the same consultation task to face 100s of times over - the stakeholders will sometimes be local and sometimes regional, state or national.
But I continue to despair of whether "stakeholder" is defined broadly enough in the industry given the staff announcement issues at NBN Co and Intenode.
Novae Meridianae Demetae Dexter delenda est
Friday, August 26, 2011
NBN Co, community consultation and migration
Really good address to today's ACS-TSA SIG by NBN Co's Mike Kaiser on rewiring a nation.
Good explanation of the migration task and the associated communication task.
A lot of agreement that the ACCAN publication National Broadband Network: Guide for Consumers is the best explanatory document around. The document actually does address things like what speed do I need and what internal changes you might want to make to get the best use.
NBN Co will be moving into full scale deployment mode soon, where on a rolling three month basis they will outline the next twelve months of construction areas.
There looks to me to be a bigger win on Comms available from having a co-ordinated NBN Co/Govt/Consumer/SP comms process. At the moment there seems to be a separate Govt plan from NBN Co plan and that doesn't make sense.
Interesting comment from many present is that they don't have the simple communications tools on hand to help them explain what the NBN is and what it will mean to people.
Anyhow, it raises my own question. My telephone line is currently an aerial lead in - as is my Foxtel/Bigpond cable. Will NBN Co publish a guide so that I could instal my own duct that could be accessed to install the NBN when it gets to my house (in about nine years I reckon cause our BB is OK)?
Novae Meridianae Demetae Dexter delenda est
Good explanation of the migration task and the associated communication task.
A lot of agreement that the ACCAN publication National Broadband Network: Guide for Consumers is the best explanatory document around. The document actually does address things like what speed do I need and what internal changes you might want to make to get the best use.
NBN Co will be moving into full scale deployment mode soon, where on a rolling three month basis they will outline the next twelve months of construction areas.
There looks to me to be a bigger win on Comms available from having a co-ordinated NBN Co/Govt/Consumer/SP comms process. At the moment there seems to be a separate Govt plan from NBN Co plan and that doesn't make sense.
Interesting comment from many present is that they don't have the simple communications tools on hand to help them explain what the NBN is and what it will mean to people.
Anyhow, it raises my own question. My telephone line is currently an aerial lead in - as is my Foxtel/Bigpond cable. Will NBN Co publish a guide so that I could instal my own duct that could be accessed to install the NBN when it gets to my house (in about nine years I reckon cause our BB is OK)?
Novae Meridianae Demetae Dexter delenda est
Politics the Ergas way
I need to take more time to digest what is in the NBn Co SAU. But henry ergas has chimed in today with a contribution that implies the SAU guarantees increasing prices rather than merely an envelope that increases below which prices will remain.
The egregious part is the comment
That, of course, won't happen. Rather, the government has demonstrated its willingness to sacrifice every principle of sound public policy to get its way. It can, and likely would, try to direct the ACCC to accept the most offensive aspects of NBN Co's SAU.
He knows that the ACCC legislation specifies that the Minister CAN NOT direct the ACCC in the application of Part XIC of the (now) Competition and Consumer Act.
The most recent example was the NBN PoI decision where the Government and NBN Co both favoured the 5 PoI outcome but the ACCC selected the 121 PoI outcome.
He also errs in his accusation that the NBN Co's differential prices by speed differs from the flat rate pricing of the ULL. With ULL the customer buys the WHOLE pair (or in LSS all the above voice frequency). With NBN Co each premise has 100 Mbps of capacity which can be acquired by different providers. I can buy 4 12/1 services from different ISPs and have them delivered to the same NTU.
Better analysis is required on all sides of the NBN model. The false accusation of rising prices needs to be dismissed.
(Note: by the same token NBN Co should have figured that the price rise reference would result in these accusations, another example that they just haven't got their act together yet)
Novae Meridianae Demetae Dexter delenda est
The egregious part is the comment
That, of course, won't happen. Rather, the government has demonstrated its willingness to sacrifice every principle of sound public policy to get its way. It can, and likely would, try to direct the ACCC to accept the most offensive aspects of NBN Co's SAU.
He knows that the ACCC legislation specifies that the Minister CAN NOT direct the ACCC in the application of Part XIC of the (now) Competition and Consumer Act.
The most recent example was the NBN PoI decision where the Government and NBN Co both favoured the 5 PoI outcome but the ACCC selected the 121 PoI outcome.
He also errs in his accusation that the NBN Co's differential prices by speed differs from the flat rate pricing of the ULL. With ULL the customer buys the WHOLE pair (or in LSS all the above voice frequency). With NBN Co each premise has 100 Mbps of capacity which can be acquired by different providers. I can buy 4 12/1 services from different ISPs and have them delivered to the same NTU.
Better analysis is required on all sides of the NBN model. The false accusation of rising prices needs to be dismissed.
(Note: by the same token NBN Co should have figured that the price rise reference would result in these accusations, another example that they just haven't got their act together yet)
Novae Meridianae Demetae Dexter delenda est
Thursday, August 25, 2011
Managing Communications
In the dying days of my career at AAPT I had to briefly fight a battle to retain a single communications function that covered internal and external communications. I did so, which was the right thing for the company, and in the process sacrificed myself.
As my blog about NBN Co today noted, the internal communication about an organisation change was always going to result in an external story. At listed companies you get very much better at setting up a sequence of communications so that staff and external stakeholders are informed by you directly at the same time.
Further analysis of the NBN Co structure reveals that while there is now a "Chief Communications Officer" (there will be another blog post about nomenclature) there are still two OTHER communications functions. Reporting to Kevin Brown in his role as Head of Corporate Services, David Auld is the GM Training Strategy and Internal Communications. Meanwhile in Operations Mike Kaiser is still listed as acting in a "Community Relations" role.
By all means recognise that there are communication execution functions across the organisation. But don't fragment them.
You cannot tell vendors, suppliers and government (external stakeholders) one thing, communities another and staff a third. There is only one truth to be communicated and it needs to be communicated in a way that addresses all these audiences.
Note: I am of course only reacting to what I can glean. Presumably the new Chief Communications Officer will have his own views and possibly seek some realignment.
Novae Meridianae Demetae Dexter delenda est
As my blog about NBN Co today noted, the internal communication about an organisation change was always going to result in an external story. At listed companies you get very much better at setting up a sequence of communications so that staff and external stakeholders are informed by you directly at the same time.
Further analysis of the NBN Co structure reveals that while there is now a "Chief Communications Officer" (there will be another blog post about nomenclature) there are still two OTHER communications functions. Reporting to Kevin Brown in his role as Head of Corporate Services, David Auld is the GM Training Strategy and Internal Communications. Meanwhile in Operations Mike Kaiser is still listed as acting in a "Community Relations" role.
By all means recognise that there are communication execution functions across the organisation. But don't fragment them.
You cannot tell vendors, suppliers and government (external stakeholders) one thing, communities another and staff a third. There is only one truth to be communicated and it needs to be communicated in a way that addresses all these audiences.
Note: I am of course only reacting to what I can glean. Presumably the new Chief Communications Officer will have his own views and possibly seek some realignment.
Novae Meridianae Demetae Dexter delenda est
All change at NBN Co
News broke yesterday afternoon of organisational changes at NBN Co. The first report I saw gave the credit to The Oz for this story.
There was no news release, the Oz and others were relying on reports they had received of Quigley's staff announcement. An immediate jump to the NBN Co website revealed no media release, but the pre-existing list of senior executives had disappeared from the tab About - People.
This morning that tab contains the content of the announcement and has been reproduced below.
The very first observation is that NBN Co would have been better advised putting out its own media release rather than rely upon the leaking of the staff announcement. They might then have managed to achieve the reporting of the CFO change as a retirement as per the announcement rather than a resignation.
The difficulty is that like so much of NBN Co's activities the moves raise more questions than answers. I don't propose to detail them here, only to note that the moves can be reasonably described as chaotic as Malcolm Turnbull has done.
A big question is what the expertise is of the new Chief Communications Officer in the core field of communications. The mangled handling of the announcement of the org changes is enough to suggest that GM Communications Andrew Sholl needs some help from above.
Indeed the much trumpeted last role at Telecom New Zealand seems to have been relatively brief. Simple research also has him quoted as supporting this campaign for abstaining from sex for the World Cup which attracted much derision.
He is a Computer Scientist by training whose last job before Telecom was running their largest retail distributor. There does not appear to have been a communications role in his prior career.
The move to create a COO is long overdue - but announcing that the CEO will "act" in the role is odd in the extreme as these people would have reported to the CEO anyway.
There may be more to comment on - I'm hunting down more details.
Organisational announcement
Message to staff:
24 August 2011
Mike Quigley
Chief Executive Officer
Today I am announcing a reorganisation of our management structure and the creation of a number of new roles in the company’s senior management team.
The reorganisation reflects our transition from a start-up focused on planning and network design to a company capable of delivering the full-scale rollout of the National Broadband Network across Australia.
The organisational changes include:
•The appointment of a Chief Communications Officer to manage government, media and stakeholder relations as well as oversee the public information campaign that will inform and educate the Australian public about the NBN rollout;
•An integration of sales, pricing, industry relations and regulatory functions in the expanded department of Product Management & Industry Relations;
•An increased focus on quality planning, control and improvement with the appointment of a Head of Quality;
•The creation of a new role of Chief Operating Officer with responsibility for construction, deployment planning, IT and network operations;
•The bringing together of supply chain management, procurement, commercial strategy and the management of the Definitive Agreements with Telstra and Optus, as part of the Corporate Services department.
In two short years NBN Co has moved from being an embryonic company to an established business that is ready to build and operate a national network.
In that time we’ve achieved some significant milestones: We’ve entered into 16 key supply agreements for construction partners, equipment suppliers and service providers; signed up 28 telcos and ISPs as wholesale and retail customers; and planned and developed the network architecture for the fibre, satellite and fixed-wireless services. In addition, we have concluded the Definitive Agreements with Telstra and Optus for access to their customers and infrastructure, subject to regulatory and shareholder approval.
That’s why it’s critical we move to the next step in our evolution. I am confident that this reorganisation of our management structure will enable us to deliver Australia’s largest infrastructure project in an efficient and coordinated manner.
The restructuring will see seven departments reporting into the CEO, including four newly-created or newly-consolidated departments. These are:
Chief Operating Officer encompassing the following functions: Construction (Dan Flemming, who is confirmed today as Head of Construction), Network Operations (Steve Christian), Planning & Design (Peter Ferris), Chief Information Officer (Claire Rawlins), New Developments (Archie Wilson), Health, Safety & Environment (Kim Flanagan), and Local Community Relations (which Mike Kaiser will continue to manage in the short term). A worldwide search has commenced for a COO. Until we make a permanent appointment, I will manage the COO’s responsibilities.
Chief Communications Officer, Kieren Cooney. Kieren is joining NBN Co in November to take up a newly-created position that will be responsible for the company’s Government, Communications and Stakeholder Relations. He will also oversee a nationwide consumer information campaign covering the migration from copper- and HFC-based telecommunications networks to the fibre-enabled NBN. Kieren has held senior executive positions across the telecommunications industry, most recently as Chief Marketing Officer at Telecom New Zealand. Previously he was CEO of Leading Edge NZ, a nationwide telecommunications reseller and retailer. Until his arrival, Kieren’s responsibilities will be managed by Kevin Brown.
Head of Quality, Mike Kaiser. Mike moves from his position as Principal, Government Relations & External Affairs to a new role responsible for implementing a comprehensive quality framework for the company.
Head of Product Management & Industry Relations, Jim Hassell. Jim’s department is now responsible for Regulatory Affairs including the WBA (Caroline Lovell), Pricing (Dieter Schadt), Revenue (Stephen Myers) and Industry Analysis. These functions join with his existing responsibilities for Product Management (Leica Ison), Sales (Ben Salmon) and Product Marketing (Tim Smith).
In other moves:
Corporate Services, headed by Kevin Brown, will now include Commercial Affairs and the Definitive Agreements with Telstra and Optus (Tim Smeallie) and Supply Chain Management (Robin Payne). These functions join with Procurement (Alasdair Fuller), Legal Affairs (Justin Forsell), Facilities (Graham Millett) and Security (Ben Heyes). The Company Secretary (Debra Connor) will report to the chairman of the board and Justin Forsell. A search has commenced for a Chief of Human Resources; Kevin will continue to act in this role until an appointment is made.
Chief Technology Officer Gary McLaren continues responsibility for Network Architecture & Technology (Tony Cross), the National Test Facility (Peter Girvan), and Product Engineering (Chris Roberts), Technology Vendor Liaison (Paul Lazarou), Transit (Andre Du Raan), Satellite (Matt Dawson) and Wireless (Joe Prelc).
Regrettably, as a result of the reorganisation Christy Boyce is leaving the company. I thank her for her contribution.
Also, Jean-Pascal Beaufret, our Chief Financial Officer, has informed me that he wishes to retire. Jean-Pascal has agreed to remain with the company until January 2012 while a search is conducted for his successor. Jean-Pascal has been an invaluable asset for NBN Co in developing our corporate plan and establishing robust financial systems. On behalf of all of us at NBN Co, we wish him well and thank him for his invaluable contribution.
What the reorganisation does not change however is the task at hand: which is to deliver a world class communications infrastructure that will sustain Australia for decades to come.
I’m confident we are putting in place the right structure to carry out that task on behalf of the Australian taxpayer.
I look forward to continue working with you to deliver this vital project for the nation.
Mike Quigley
Chief Executive Officer
NBN Co
Novae Meridianae Demetae Dexter delenda est
There was no news release, the Oz and others were relying on reports they had received of Quigley's staff announcement. An immediate jump to the NBN Co website revealed no media release, but the pre-existing list of senior executives had disappeared from the tab About - People.
This morning that tab contains the content of the announcement and has been reproduced below.
The very first observation is that NBN Co would have been better advised putting out its own media release rather than rely upon the leaking of the staff announcement. They might then have managed to achieve the reporting of the CFO change as a retirement as per the announcement rather than a resignation.
The difficulty is that like so much of NBN Co's activities the moves raise more questions than answers. I don't propose to detail them here, only to note that the moves can be reasonably described as chaotic as Malcolm Turnbull has done.
A big question is what the expertise is of the new Chief Communications Officer in the core field of communications. The mangled handling of the announcement of the org changes is enough to suggest that GM Communications Andrew Sholl needs some help from above.
Indeed the much trumpeted last role at Telecom New Zealand seems to have been relatively brief. Simple research also has him quoted as supporting this campaign for abstaining from sex for the World Cup which attracted much derision.
He is a Computer Scientist by training whose last job before Telecom was running their largest retail distributor. There does not appear to have been a communications role in his prior career.
The move to create a COO is long overdue - but announcing that the CEO will "act" in the role is odd in the extreme as these people would have reported to the CEO anyway.
There may be more to comment on - I'm hunting down more details.
Organisational announcement
Message to staff:
24 August 2011
Mike Quigley
Chief Executive Officer
Today I am announcing a reorganisation of our management structure and the creation of a number of new roles in the company’s senior management team.
The reorganisation reflects our transition from a start-up focused on planning and network design to a company capable of delivering the full-scale rollout of the National Broadband Network across Australia.
The organisational changes include:
•The appointment of a Chief Communications Officer to manage government, media and stakeholder relations as well as oversee the public information campaign that will inform and educate the Australian public about the NBN rollout;
•An integration of sales, pricing, industry relations and regulatory functions in the expanded department of Product Management & Industry Relations;
•An increased focus on quality planning, control and improvement with the appointment of a Head of Quality;
•The creation of a new role of Chief Operating Officer with responsibility for construction, deployment planning, IT and network operations;
•The bringing together of supply chain management, procurement, commercial strategy and the management of the Definitive Agreements with Telstra and Optus, as part of the Corporate Services department.
In two short years NBN Co has moved from being an embryonic company to an established business that is ready to build and operate a national network.
In that time we’ve achieved some significant milestones: We’ve entered into 16 key supply agreements for construction partners, equipment suppliers and service providers; signed up 28 telcos and ISPs as wholesale and retail customers; and planned and developed the network architecture for the fibre, satellite and fixed-wireless services. In addition, we have concluded the Definitive Agreements with Telstra and Optus for access to their customers and infrastructure, subject to regulatory and shareholder approval.
That’s why it’s critical we move to the next step in our evolution. I am confident that this reorganisation of our management structure will enable us to deliver Australia’s largest infrastructure project in an efficient and coordinated manner.
The restructuring will see seven departments reporting into the CEO, including four newly-created or newly-consolidated departments. These are:
Chief Operating Officer encompassing the following functions: Construction (Dan Flemming, who is confirmed today as Head of Construction), Network Operations (Steve Christian), Planning & Design (Peter Ferris), Chief Information Officer (Claire Rawlins), New Developments (Archie Wilson), Health, Safety & Environment (Kim Flanagan), and Local Community Relations (which Mike Kaiser will continue to manage in the short term). A worldwide search has commenced for a COO. Until we make a permanent appointment, I will manage the COO’s responsibilities.
Chief Communications Officer, Kieren Cooney. Kieren is joining NBN Co in November to take up a newly-created position that will be responsible for the company’s Government, Communications and Stakeholder Relations. He will also oversee a nationwide consumer information campaign covering the migration from copper- and HFC-based telecommunications networks to the fibre-enabled NBN. Kieren has held senior executive positions across the telecommunications industry, most recently as Chief Marketing Officer at Telecom New Zealand. Previously he was CEO of Leading Edge NZ, a nationwide telecommunications reseller and retailer. Until his arrival, Kieren’s responsibilities will be managed by Kevin Brown.
Head of Quality, Mike Kaiser. Mike moves from his position as Principal, Government Relations & External Affairs to a new role responsible for implementing a comprehensive quality framework for the company.
Head of Product Management & Industry Relations, Jim Hassell. Jim’s department is now responsible for Regulatory Affairs including the WBA (Caroline Lovell), Pricing (Dieter Schadt), Revenue (Stephen Myers) and Industry Analysis. These functions join with his existing responsibilities for Product Management (Leica Ison), Sales (Ben Salmon) and Product Marketing (Tim Smith).
In other moves:
Corporate Services, headed by Kevin Brown, will now include Commercial Affairs and the Definitive Agreements with Telstra and Optus (Tim Smeallie) and Supply Chain Management (Robin Payne). These functions join with Procurement (Alasdair Fuller), Legal Affairs (Justin Forsell), Facilities (Graham Millett) and Security (Ben Heyes). The Company Secretary (Debra Connor) will report to the chairman of the board and Justin Forsell. A search has commenced for a Chief of Human Resources; Kevin will continue to act in this role until an appointment is made.
Chief Technology Officer Gary McLaren continues responsibility for Network Architecture & Technology (Tony Cross), the National Test Facility (Peter Girvan), and Product Engineering (Chris Roberts), Technology Vendor Liaison (Paul Lazarou), Transit (Andre Du Raan), Satellite (Matt Dawson) and Wireless (Joe Prelc).
Regrettably, as a result of the reorganisation Christy Boyce is leaving the company. I thank her for her contribution.
Also, Jean-Pascal Beaufret, our Chief Financial Officer, has informed me that he wishes to retire. Jean-Pascal has agreed to remain with the company until January 2012 while a search is conducted for his successor. Jean-Pascal has been an invaluable asset for NBN Co in developing our corporate plan and establishing robust financial systems. On behalf of all of us at NBN Co, we wish him well and thank him for his invaluable contribution.
What the reorganisation does not change however is the task at hand: which is to deliver a world class communications infrastructure that will sustain Australia for decades to come.
I’m confident we are putting in place the right structure to carry out that task on behalf of the Australian taxpayer.
I look forward to continue working with you to deliver this vital project for the nation.
Mike Quigley
Chief Executive Officer
NBN Co
Novae Meridianae Demetae Dexter delenda est
Monday, June 20, 2011
Balance or what?
Mainstream media regularly gets a bagging for its mono-voice - be that criticism from Gerard Henderson about the left leaning Age and ABC, or the rest of the commentariat about the "conservative" agenda of the Oz.
So it was pretty intriguing to see "balance" from on-line media site iTWire. It carried two pieces by renai Le May that bagged the opposition's approach to attacking Quigley. It then had editor Stan Beer's own column defending the coalition's approach. He writes, in part;
It is both proper and desirable for Coalition members of the Senate Estimates committee to subject Mr Quigley to an intense and thorough grilling.
Mr Quigley is a big boy and there is no doubt he can defend himself in Senate Estimates. He doesn't need the media jumping to his defence. In fact, a supposedly impartial media should be asking many of the same questions as the questions being raised in Estimates. In a free country that's what the media and the Opposition are supposed to do.
Problem is that at least one commentator, me, has been saying that it is right to subject the NBN to intense scrutiny - but the scrutiny needs to be focussed on what NBN Co is doing now, not on the recruitment process for the CEO.
But full credit at least to Stan for running the syndicated column from Renai...unless they were just to give credibility to his own column.
Novae Meridianae Demetae Dexter delenda est
So it was pretty intriguing to see "balance" from on-line media site iTWire. It carried two pieces by renai Le May that bagged the opposition's approach to attacking Quigley. It then had editor Stan Beer's own column defending the coalition's approach. He writes, in part;
It is both proper and desirable for Coalition members of the Senate Estimates committee to subject Mr Quigley to an intense and thorough grilling.
Mr Quigley is a big boy and there is no doubt he can defend himself in Senate Estimates. He doesn't need the media jumping to his defence. In fact, a supposedly impartial media should be asking many of the same questions as the questions being raised in Estimates. In a free country that's what the media and the Opposition are supposed to do.
Problem is that at least one commentator, me, has been saying that it is right to subject the NBN to intense scrutiny - but the scrutiny needs to be focussed on what NBN Co is doing now, not on the recruitment process for the CEO.
But full credit at least to Stan for running the syndicated column from Renai...unless they were just to give credibility to his own column.
Novae Meridianae Demetae Dexter delenda est
Wednesday, April 06, 2011
NBN Construction
NBN Co has scrapped its construction tenders and now its construction chief has resigned.
Way back when the NBN Co Board was first appointed I noted that the Board was long on deal makers but short on telco expertise and large construction project expertise.
It is not too late to fix it!
Novae Meridianae Demetae Dexter delenda est
Way back when the NBN Co Board was first appointed I noted that the Board was long on deal makers but short on telco expertise and large construction project expertise.
It is not too late to fix it!
Novae Meridianae Demetae Dexter delenda est
Thursday, February 25, 2010
NBN Co legislation
Oh dear. I thought telco policy had moved on from the days when every piece of policy was scrutinised through the lens of its implication for telco privatisation, but today it appears it is still the case that commentators only look at the implication of NBN policy from its impact on Telstra.
The Government yesterday released exposure drafts of the NBN Co legislation. Firstly that is a great step and much better than, say, the Howard Government's final Telstra privatisation Bill wich was introduced with no consultation and gave industry one day to prepare for a one day Senate hearing.
But both the Oz and the SMH report the provision in the Bill that the Minister can authorise NBN Co to sell dierectly as a threat to Telstra. The conclusion is reached because of references to Government Departments.
The reality is that, firstly, Government Departments are big customers in terms of revenue but very poor in terms of profit - simple because they have been big enough to get most of the benefits of competition that exist so far. Secondly the real concern here is that the ability to do things like e-health and e-education shouldn't be impeded by the need to deal with service providers. This isn't about Government using the NBN to connect to its premises, but to citizens.
Meanwhile I note in industry newsleter Communications Day the speculation on the fate of the other current bill, the one that does seek to split Telstra. They write in part;
The government’s desire to separate Telstra originally appeared set to split the coalition, with Nationals Senators Fiona Nash and Barnaby Joyce advocates of separation while Liberal colleagues rallied against any split. However, the Nationals are now set to vote on coalition lines with Joyce in shadow cabinet and both Senators determined to force the government to reveal numerous secret documents relating to the original NBN process. CommsDay understands that Joyce and Nash could still push for a Telstra split at a later date – but not until Conroy releases the McKinsey/KPMG NBN Implementation Study, due to be delivered to the minister by the end of the week.
I can fully understand that the new world order of the coalition prohibits them splitting on the issue. But the new world order should perhaps contemplate a change in their approach to communications policy, just as it did a change on climate change policy. As it stands today the coalition has no communications policy other than to say no, or perhaps that OPEL was better.
It is interesting to note that they never demanded an ANAO report on the cancellation of that contract. That's perhaps because they are afraid that not only will it find the Government was right to cancel it because the conditions precedent were not met, but that the ANAO would likely find that he contract should never have been entered into.
Meanwhile after the replacement of Minchin with Smith the coalition still hasn't progressed on communications policy. Conroy used to count the number of releases Minchin had come out with without a single policy proposal. Smith isn't doing any better.
Perhaps these were the kinds of people new leader Tony Abbott was addressing when he's asked them to "use their brains" at his policy roundtable on Friday. Not much chance of decent communications policy if (a) it is only Liberals, and (b) Henry Ergas is in the room.
Finally, the coalition seems to wrap themselves in a sanctimonious flag of demanding the release of certain documents prepared for advice to government. First it was the expert panel report and now it is the implementation study. In Government the coalition never released such documents. Holding Government to account means holding them to account on outcomes not second guessing the decisions.
I hope the Nationals find the courage to go to the coalition meetings and say that the cause of improved telecommunications to regional Australia is not advanced by an opposition who simply refuses to debate legislation, or opposes legislation such as structural separation (a long held National Party view) or fibre to the home (which was the core of the Page Centre report).
The Government yesterday released exposure drafts of the NBN Co legislation. Firstly that is a great step and much better than, say, the Howard Government's final Telstra privatisation Bill wich was introduced with no consultation and gave industry one day to prepare for a one day Senate hearing.
But both the Oz and the SMH report the provision in the Bill that the Minister can authorise NBN Co to sell dierectly as a threat to Telstra. The conclusion is reached because of references to Government Departments.
The reality is that, firstly, Government Departments are big customers in terms of revenue but very poor in terms of profit - simple because they have been big enough to get most of the benefits of competition that exist so far. Secondly the real concern here is that the ability to do things like e-health and e-education shouldn't be impeded by the need to deal with service providers. This isn't about Government using the NBN to connect to its premises, but to citizens.
Meanwhile I note in industry newsleter Communications Day the speculation on the fate of the other current bill, the one that does seek to split Telstra. They write in part;
The government’s desire to separate Telstra originally appeared set to split the coalition, with Nationals Senators Fiona Nash and Barnaby Joyce advocates of separation while Liberal colleagues rallied against any split. However, the Nationals are now set to vote on coalition lines with Joyce in shadow cabinet and both Senators determined to force the government to reveal numerous secret documents relating to the original NBN process. CommsDay understands that Joyce and Nash could still push for a Telstra split at a later date – but not until Conroy releases the McKinsey/KPMG NBN Implementation Study, due to be delivered to the minister by the end of the week.
I can fully understand that the new world order of the coalition prohibits them splitting on the issue. But the new world order should perhaps contemplate a change in their approach to communications policy, just as it did a change on climate change policy. As it stands today the coalition has no communications policy other than to say no, or perhaps that OPEL was better.
It is interesting to note that they never demanded an ANAO report on the cancellation of that contract. That's perhaps because they are afraid that not only will it find the Government was right to cancel it because the conditions precedent were not met, but that the ANAO would likely find that he contract should never have been entered into.
Meanwhile after the replacement of Minchin with Smith the coalition still hasn't progressed on communications policy. Conroy used to count the number of releases Minchin had come out with without a single policy proposal. Smith isn't doing any better.
Perhaps these were the kinds of people new leader Tony Abbott was addressing when he's asked them to "use their brains" at his policy roundtable on Friday. Not much chance of decent communications policy if (a) it is only Liberals, and (b) Henry Ergas is in the room.
Finally, the coalition seems to wrap themselves in a sanctimonious flag of demanding the release of certain documents prepared for advice to government. First it was the expert panel report and now it is the implementation study. In Government the coalition never released such documents. Holding Government to account means holding them to account on outcomes not second guessing the decisions.
I hope the Nationals find the courage to go to the coalition meetings and say that the cause of improved telecommunications to regional Australia is not advanced by an opposition who simply refuses to debate legislation, or opposes legislation such as structural separation (a long held National Party view) or fibre to the home (which was the core of the Page Centre report).
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