Thinking out loud

We've been told that the joint NBN Committee is going to hear from New Zealand so that;

The conversations are hoped to settle an ongoing argument from shadow communications minister Malcolm Turnbull that a fibre-to-the-node rollout would cost a quarter or a third of the $27 billion headline currently set for government contributions to the NBN.

I am a little bemused by the claim, and indeed how it relates to Turnbull's other claim that FTTN is a good interim technology, again because New Zealand has done it.

The New Zealand government has committed $1.5B to be a co-investor in delivering FTTH to 75% of premises. They are funding half and as the Government investor intend to accept a lower return than the private investors. I haven't seen the rest of the detail.

The population of New Zealand is roughly one fifth of Australia's, and the coverage of 75% is roughly 80% of our target. The $NZ3B investment for the coverage equates to about $NZ18.5B for the Australian FTTH coverage. Allowing for a 1.2 exchange rate we can tweak that back to $15.4B.

But we aren't doing apples for apples. The $26B of Government funding in Australia funds $43B investment in the NBN (P.365 of the implementation study). Not all the $43B funds the fibre build - in fact the breakdown from the implementation study is shown below.

At the simplest we can say one eighth of the total cost funds the satellite and fibre solution, so that means the Govt funding for the fibre part is seven-eighths of $26B, or $22.3.

But so far we've assumed that servicing 75% of premises would cost the same per premise as 93%. The implementation study conveniently provided a chart relating cost to penetration, below.

A generous interpretation is $2000 per premise for the first 75% and $5000 per premise for the additional 18%. That comes to the cost of the first 75% being 62.5% of the total fibre cost.

Or stated another way, if all the premises were covered at $2000 the project would cost 77.5%. If we simply use three-quarters the investment required to do 93% if it cost the same as 75% would be three quarters of 22.3 or $16.725B

So my numbers to compare are NZ $15.4B, Australia $16.7B. That variation could be potentially explained by the fact Chorus has built fibre to the node, but nothing in it deals with their lost sunk investment in nodes.

No wonder after Turnbull used the EIU report the EIU analyst pointed out that their report favoured the Australian solution over New Zealand (behind AFR paywall).

The difference is that Turnbull consistently ignores 25% of the people. I continue to ask where Fiona Nash and Barnaby Joyce are on this?

Novae Meridianae Demetae Dexter delenda est

Earthquakes in New Zealand

Yesterday there was much fun in Melbourne yesterday as the city got a little jolt from an earthquake.

Meanwhile a larger earthquake hit New Zealand yesterday - a 6.5 up near lake Taupo.

A better way to put these events in perspective is to look at the respective geo-science resources. Australian and regional earthquakes are mapped by Geoscience Australia. The map (done for the region showing all earthquakes in the last month) is most remarkable for the very few dots over Australia and the small size of them.

For some reason the Taupo earthquake isn't showing on the Australian map. But the NZ equivalent resource lists recent earthquakes. The one I'm talking about is reference number 3540736. The number of quakes they have this will be off their recent list soon.

The reality was this was a big quake, but it was very deep and a long way away from built up areas. But New Zealanders are being reminded of the risks.

As the story notes;

At 150km deep and 30km west of Taupo, the damage from the latest big earthquake to hit New Zealand was minimal....A major movement on the Wellington Fault - which does happen every 100 years or so - is likely to result in an earthquake measuring about 7.5 with surface rupture of over 50km. Compare this with the September 4 Darfield quake which caused a 29km rupture that was mainly across rural Canterbury land.

To these risks we should add the risks of volcanic action in New Zealand - far greater than the risk reported today of an Aussie volcanic eruption.

While the warning about risk management was to Kiwis, major volcanic or earthquake activity in Australia will be felt by us just as if the Kiwis hadn't made their big mistake of 1900 and not joined the Federation.

Australia's disaster planning needs to cover both the direct and indirect effects of one of these New Zealand disasters. It is not a matter of if, but when. Despite the comments of scientists and others about periodicity we cannot know when - it could still be hundreds of years away - or it could be tomorrow.


Novae Meridianae Demetae Dexter delenda est