It would have surprised residents of the nearly 4 million premises still to connect national broadband network (NBN) services, but a ministerial declaration on 23 December 2020 that the network is “built and fully operational” has allowed the government to call the project a success – and trigger the first of four steps towards privatising the network.
The formal declaration by Paul Fletcher, the Minister for Communications, Urban Infrastructure, Cities and the Arts – made under s48 of the National Broadband Network Companies Act 2011 – comes after Fletcher reviewed the project’s progress to date and deemed that it was close enough to completion for the declaration to be “appropriate”.
Some 11.88 million premises are ready to connect to the network, according to recent NBN Co rollout statistics, although 3.97 million premises still have yet to actually connect.
A further 17,648 premises were flagged as still being not yet ready to connect – reflecting the tail end of a queue of particularly complex installations that NBN Co pegged at 100,000 premises in August, and 60,106 premises as of 20 November 2020.
“Of course the government recognises that there are some premises which have not yet been made ready to connect,” Fletcher said in a statement, “and I expect NBN Co to work as speedily as possible to make the network available to those premises.”
Triggering the NBN sell-off?
Made just two days before Christmas, the proclamation that the NBN Is complete came three-and-a-half years after the project reached its mid-point and six months after the company’s original deadline, which in 2019 was confirmed for 30 June 2020 but slid owing to the complexities and challenges of the COVID-19 pandemic.
The company ultimately exceeded its own build targets, CEO Stephen Rue said in July – however, increased bandwidth demand during that pandemic also prompted the company to this year accelerate a new phase of its rollout.
The network builder is also ramping up the delivery of 1Gbps fibre-to-the-premises (FTTP) services to a cohort of homes by 2023 – a move that Fletcher has defended as part of the natural evolution of the project.
Investment in ongoing network upgrades will boost the NBN’s overall service profile, but observers have wondered aloud whether it isn’t also an effort to boost average revenue per user (ARPU) measures whose stagnancy has tainted the network’s appeal to possible commercial buyers.
Fletcher’s proclamation under s48 effectively pushes the button on the privatisation of NBN Co, given that the declaration the network is “built and fully operational” is the first of four legislated triggers necessary for the NBN to be sold off.
Three more triggers remain before the Commonwealth’s ownership of the NBN can be formally terminated, for example by selling it to a private buyer.
These include the tabling in Parliament of a report from a Productivity Commission inquiry; its examination by the Parliamentary Joint Committee on the Ownership of NBN Co; and a declaration by the Finance Minister that “conditions are suitable for the entering into and carrying out of an NBN Co sale scheme”.
That could be a big ask given ongoing COVID-era economic malaise, although a recent Deloitte market analysis did suggest bold action, convergence and monetisation would be crucial for companies to thrive in the post-COVID era.
The Productivity Commission inquiry must consider issues such as equity of access to NBN services in metropolitan, regional, rural and remote areas; structure and competition in telecommunications markets; service bundling; the need for maintaining and upgrading NBN technology; and more.
There will always be a small number of premises remaining to be serviced, NBN Co said in a November report discussing the extent to which the network had been built, in which it claimed to have completed 99.5 per cent of the initial build.
NBN Co “considers it has appropriate processes and systems to provide access to currently unserviceable premises and to premises that continue to emerge,” the report concluded, noting that NBN Co expects there will be “just over 5,000 premises” still waiting to be made ready to connect by June.