As Shirley Bassey once sang, it's all just a little bit of history repeating. In 1995, then-Prime Minister Paul Keating outlined the Government's plan to adopt the bundle of service and technologies collectively known as the information superhighway. How quaint that title seems, as we look back through the goggles of an inexorably wired world.

Fast forward a decade and a half, and the Rudd Government's announcement of a high speed broadband network has some eerie parallels. Both Prime Ministers
passionately emphasised that the advent of new technology would benefit education and health services, and that Australians would see fundamental improvements in productivity, communication and lifestyle.

Prime Minister Kevin Rudd, however, has a broader horizon of ambition. He doesn't just want to make Australia a port of call on the onrushing river of information, he wants to make the country more globally competitive. He aims to put Australia's internet speeds on par with those of South Korea and Singapore, the Asian nations. Australia is realising it has more in common with than mere geographical proximity. On top of that, it's a bold statement of intent given the current economic condition, a fact surely not lost on the current administration.

"It sets up a path for economic recovery, and building a 21st century economy with 21st century jobs," says Rudd. He claims the network will provide 25,000 jobs a year for the project's lifetime, a figure that will rise to 37,000 at its peak, adding that it will contribute the not insignificant total of $27 billion to Australia's GDP.

The nuts and bolts

The national broadband network (NBN) was a key element of the Rudd program discussed during his election in 2007. Nevertheless, the tender process for the network became cluttered and muddled, with Telstra casting a very long shadow, but more on that later. As it stands, the plan is for the Government to set up a private company that will build the network over the next eight years. The Government will own 51% of the company, with private sector investment accounting for the other 49%, and will sell its holdings within five years of the network being operational.

With a projected total cost of A$43 billion, the broadband plan is the largest national infrastructure project in Australia's history. The Government will provide an initial investment of A$4.7 billion, funded by the Building Australia Fund, and will launch an implementation study in the near future.

What raised eyebrows the highest was that the NBN would implement fibre-to-the-home (PITH) technology instead of fibre-to-the-node (FTTN). As Institute of Public Affairs research fellow Chris Berg writes in an article for Crikey, "Simply put, it would have been humiliating for Communications Minister Stephen Conroy to trumpet a 12Mbps network while there are superior products in the broadband marketplace."

The initial plan was to lay fibre to street corners, or nodes, before connecting it to the existing, slower, copper wire network. The biggest problem with this FTTN scenario was that connection speeds would decrease the further a user was from the node. Add to this the fact that Telstra owned these nodes, and you can see how a financial and legal can of worms threatened to open up.

FTTH, on the other hand, will see a fibre optic cable run directly to homes in the same manner that electricity and telephone cables do. These cables are made of glass and carry light signals to transmit information at extremely high speeds — the speed of light, as a matter of fact, less losses from encoding, decoding and the equipment used.

In broad terms, the plan's appeal centres on speed. To put things in perspective, the FTTN scheme promised speeds of up to 12 megabits per second (mbps), while the FTTH plan promises a 100 mbps connection to 90 per cent of all Australian homes, schools and businesses. That's eight times faster than originally promised and about
100 times faster than the connection most Australians are used to. The remaining 10 per cent of the country will be connected via wireless and satellite technology, with speeds of up to 12 megabits per second.

Future-proof

Initial reaction to the plan has largely been positive. Perhaps the most common comparison is that broadband's role for this century is comparable to that of electricity in the last and railways before that. At the risk of sounding shockingly idealistic, the broadband network could be a catalyst for change in ways that could not have been imagined in the early stages of proliferation.

While there are legitimate concerns that accelerating the internet would mainly facilitate illegal downloads, the speed with which information could be disseminated opens up whole realms of possibility. Real- time, online assistance for everything from surgeries to experiments and emergency services, even in remote country areas, doesn't sound outlandish.

And as the proliferation of Skype has shown, communication remains one of the internet's main selling points. As abc.net.au editor Bruce Belsham puts it, the NBN "reduces the tyranny of distance in terms of (Australia's) remoteness from the rest of the world."

Paul Fletcher, the author of Wired Brown Land: Telstra's Battle for Broadband, writes in the Herald Sun that the NBN puts all Australians on a level playing field, compared to the "patchwork quilt" of today's DSL technology. Fletcher is also one of the many commentators who foresees an impending era of healthy competition. "In turn, that will mean the lowest possible prices - and the greatest possible rate of innovation," he says.

Fears have emerged that the technology might be obsolete by the time the project is complete in eight years, especially given the rate of change in telecommunications. However, various commentators feel that Australia could ramp up delivery to compare with the speeds that South Korea will provide in the not-too-distant future. Rod Tucker, laureate professor at the University of Melbourne, has written that the FTTH network could one day deliver many gigabits per second to the home.

Is the price right?

Nevertheless, the program has received its fair share of criticism. Opposition leader Malcolm Turnbull says the broadband plan will saddle Australians with more debt, and correspondingly higher taxes and interest rates. He has also lambasted the fact that the Prime Minister has put a price tag on the plan while not providing "one skerrick of financial detail."

The mononymous Stilghernan's typically snarky response for Crikey is that infrastructure doesn't have to be profitable in and of itself — that roads and sewers aren't built to make money, but to provide what the nation needs. He quotes a Telstra employee as pointing out that there is plenty of spare fibre optic cable in the ground, laid during the first dotcom boom. "There's dark fibre from the Pilbara to Perth and Kalgoorlie, Warrnambool to Geelong and Melbourne. Even Mt Gambier has fibre optic cable sitting there. It's kind of like rats. There's bound to be some fibre optic cable within about six feet of you."

The Government also plans to launch a $250 million rural broadband project in September that will focus on areas that lack competitive broadband service, such as Mildura (VIC) and Darwin (NT). It will be operated by the winners of a tender process before being turned over to the Government as part of the NBN.

Reports have already emerged of different states vying to become the NBN's hub, with Queensland Premier Anna Bligh and her NSW counterpart Nathan Rees among those throwing hats into the ring. It looks like the various premiers are sold on Rudd's promise that the NBN will generate no small amount of jobs so vital, now that he has deigned to admit Australia is in a recession.

That recession is part of the reason that the NBN's cost is a hotly debated issue. The price tag of $43 billion is a long away from the $4.7 billion the initial scheme would cost. That lower figure now becomes the initial equity stake, funded by the Building Australia Fund. Treasurer Wayne Swan sees no problem with raising the funds. In a gung-ho statement, Swan felt there would be a lot of interest, particularly from retail investors in Australian bonds, as he lauded the commercial sensibilities of the project.

There remain some valid concerns, however. With sums as large as these on the table, it's little wonder that coverage has thrown up the name of Gough Whitlam more than once. And as Goldman Sachs points out, part of the proposal involves the issuing of infrastructure bonds, which will take net Government debt up to 7.8 per cent of GDP from the investment bank's current estimate of 5 per cent - quite a turnaround from the positive net asset position of less than a year ago.

Casting a long shadow

Richard Alston, the former Minister for Communications, Information Technology and the Arts, wrote in The Australian that the NBN announcement is a "battering ram designed to force Telstra to the bargaining table", and the shape of the new landscape depends crucially on interactions between Telstra and the Government from here
on out.

There are so many issues concerning Telstra that it would take another article to cover them; issues left over from its privatisation, the possibility (and viability)
of separating its retail and wholesale arms, its role in the tender process that led to the announcement of the NBN, and even, as some reports posit, the possibility that it could build its own network.

Telstra will have a large part to play before this saga is complete, and its action or inaction could make or break Rudd's grand design. However, Telstra has been making all the right noises, publicly lauding the future potential inherent in the project while seeking what it termed "constructive discussions" with the government.

Question time

According to the Organisation for Economic Co-operation and Development (OECD), the latest broadband access statistics show South Korea at the top of the heap with more than 90 per cent of its households online. Japan is fifth with just under 70 per cent, while Australia places 18th with a little over 40 per cent.

There's certainly room for growth there but how will Australians respond? For the moment, questions vastly outnumber answers, and that's just one of them. Should the government have as large a stake as it does? Will the commercial returns of the project justify its large cost? In addition, will Australians be able to come up with the sort of content that makes best use of this dizzying speed? Other platforms have lived or died based on developers' abilities to come up with a killer app. That might not be the case for the NBN, but if it is going to generate economic activity., more work needs to be done.

As abc.net.au editor Belsham asks, "are we going to put in place the systems that allow small business, allow content producers, that allow the entertainment industry, the education industry, the medical industry to provide the kind of content that makes best use of that technology?"

It will also be interesting to see how the media evolves, as existing regulations go out the window with enormous implications both content-wise and commercially. Business models will change as advertising does, and as convergence is taken to new levels.  There's also a lack of information regarding the satellite and wireless internet options offered to rural communities with no access to the NBN, and exactly what form the "mix of technology" promised to them will take.

So many questions, so few answers — but Taswegians will have a lot to say when it comes to answering them, as the island state is earmarked to be the proving ground for working out the costs and penetration of the NBN.

Tasmania could begin rolling out broadband as soon as July, providing an indication of the take-up rates that will determine the price of accessing the network. Like so many other things, the actual cost of accessing the network remains up in the air, despite the mudslinging that has thus far transpired — the Opposition has bandied about a figure of $200, which Stephen Conroy in turn has dismissed. And, looming over everything is this massive poser: just what is Telstra going to do?

The planning and politicking have only just begun, along with the bickering and bargaining. Decisions will be made and changed, and debates will continue to rage. But the brave new world that the Rudd administration is looking to catalyse is tiptoeing ever closer, and the future might well be knocking on your door sometime later this year.

Reprinted from the June 2009 issue of PC Update, the magazine of Melbourne PC User Group, Australia

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