Saturday, February 26, 2011

Deception Defined

As Malcolm Turnbull continues his ideology-based attack on the National Broadband Network, examples of the truth in his ramblings are growing harder to find. As the NBN is rolled out, and uptake rates skyrocket towards 90%, it’s becoming harder for the coalition to attack the NBN based on factual information. This has lead to the regular use of weasel words and vague statements to make readers assume that the coalition will deliver as good a practical outcome as the NBN, when the two policies are chalk and cheese.

You can find his latest opinion piece in the SMH here.

Let’s take a look at some of Turnbull’s statements this time around:
“Everybody loudly and emphatically agrees that all Australians should have access to fast broadband and at an affordable price.”

This is where talk and reality begin to part ways. You see, Turnbull’s definition of “fast” is 12Mbps. I kid you not. Just as the USA promise almost their entire population 100Mbps within 10 years, and South Korea raise the bar with an NBN-equivalent 1Gbps, the Liberal/National coalition policy is stuck at 1/100th of that speed. This is the speed that the Coalition have promised to deliver to 97% of Australian premises. The other 3% get no commitment at all.

In case you’re wondering where the figure of 12Mbps comes from, it’s the speed that a half-decent ADSL2+ connection will deliver. Why is that important? Because if Turnbull promised a universal speed any higher than 12Mbps, it would mean they would have to support the NBN (or something like it), because 12Mbps is the fastest practical speed that can be expected over the existing copper network.

So, while criticising the Government for “putting the cart before the horse”, that’s exactly what the coalition have done. Rather than asking “what broadband speeds will the World be moving towards over the next decade”, Turnbull and Co have asked “what is our current network reasonably capable of providing”, and worked backwards from there. It’s an incredibly stupid way to devise a policy.

Imagine if Formula 1 worked that way! Instead of looking at the other teams and seeing what speeds they’ll be getting next season, the Coalition F1 team would grab a 50-year-old engine, work out how fast it can make their car go, and decide that’s where they need to be. Meanwhile, the other teams have all bought new engines, which run 10-100 times faster than ours. It’s not hard to see how competitive we’ll be in this “global race”.

Turnbull continues:
"The right approach to our broadband needs should not be one size or one technology fits all. It should target under-serviced areas immediately and bring them up to the highest standards available in our cities."

Now this is a curious statement. What's more, it's a fantastic idea. Imagine if all Australians could access the same fast speeds available in parts of our cities! It’s the first time I’ve seen Turnbull write such a thing, and it’s directly at odds with the coalition policy. In fact, it sounds an awful lot like what the NBN will do.

You see, many areas of out cities can access HFC cable networks, which offer speeds of about 30Mbps. New estates often contain FTTP connections (like the NBN) at up to 100Mbps. If Turnbull is now saying that everyone should have access to these speeds, then I’d love to hear how he’s proposing it can be done, since the copper network doesn’t have a hope of delivering such speeds. In reality, what Turnbull has done is deceived the reader into thinking that the coalition policy would actually deliver what he has written, when it won’t, it can’t, and their policy admits as much.

Having warmed himself up, Turnbull now moves into deception overdrive:
"Right now 30 per cent of Australian homes are passed by the hybrid fibre coaxial pay TV cables of Telstra and Optus. These systems can, and in some places do, run at 100Mbps, the highest speed promised by the new network."

What misleading hogwash. Turnbull is using the average person’s lack of technical knowledge to promote misleading information on the HFC networks.

Deception #1: HFC network size:

Notice that Turnbull says the networks PASS properties, rather than saying the properties can actually TAKE UP a connection. It’s like saying there’s a freeway behind your house. Without an on-ramp, it doesn’t do you any good at all.

The financially disastrous rollouts of the HFC networks in the 1990s earned Optus and Telstra the nicknames of Mary and her little lamb. Because everywhere that Mary (Optus) went, the lamb (Telstra) was sure to go. The result was that we got two HFC networks that cover the same properties in a few Australian capital cities. Thanks to their deeper pockets, Telstra’s network is slightly larger (at 2.5 million homes) that Optus’ (at 2.2 million). Telstra won’t reveal how many of those homes passed can actually get a service, but Optus admit that only 1.4 million of their 2.2m (63%) are able to be connected to the network due to technical reasons.

Since there are about 10.3 million residential and business premises in Australia, at most the HFC networks are available to 24% of them (if we assume 100% availability from Telstra), and at worst about 15% (Transposing Optus’ 63% availability to the Telstra network).

Deception #2: HFC network speed:

Notice that Turnbull says the NETWORK can deliver 100Mbps, not that USERS can actually get that speed.

HFC is a shared network. It’s true that thanks to a recent upgrade, parts of some of the networks have a speed of 100Mbps. But that speed is per node of the network, not per user. Each node can have multiple connections, so the 100Mbps is divided by all the users on that node. Perhaps that’s why Telstra advise that their HFC network delivers 30Mbps,  while Optus are even worse, saying that “76% of Optus Cable customers can access average speeds of over 8Mbps.” Yep, that’s right. 
The network that Turnbull claims operates at 100Mbps is actually incapable of giving a quarter of subscribers even 8Mbps. And the rest might get 30Mbps, but there are no guarantees.

Deception #3: Maximum NBN speed:

This one is just an outright lie. Turnbull says that 100Mbps is the highest speed promised by the NBN. Bullshit. The NBN will offer speeds of up to 1Gbps, that is 1000Mbps. And Turnbull already knows this, because he’s mentioned it on his own blog.

It would seem that without any facts to support the Coalition position, Turnbull has decided that the only way to fight the NBN is with smear, lies and deceit, perhaps in the hope that the Australian public won’t understand the technology of which he speaks. 
It’s a dangerous gamble that will undoubtedly come back to bite him, as future generations either laugh at his statements, or rue the day their parents voted him into Government, sending Australia’s communications infrastructure hurtling back into the 1900s.

Saturday, January 22, 2011

Andrew Robb: Maestro of Bullshit

There’s no sign of the Coalition’s NBN smear campaign slowing down, with their latest effort being a disgusting attempt to use the Queensland floods as a tool to stop the network that cost them the last election, and could well cost them the next one.

My guess is that Abbott and the Parties of No are beginning to realise that by the 2013 federal election, the NBN will be well underway and employing tens-of-thousands of Australians. Should they go to an election with a policy that will result in the dismissal of 20-30,000 people, it could cause some problems! So better to nip it in the bud before it’s too late!

In response to Finance Minister Penny Wong’s explanation as to why NBN funding couldn’t simply be diverted to flood relief, shadow Minister Andrew Robb issued a response which was so full of bullshit that he could sell it as fertiliser:

Penny Wong’s absurd denials that the billions to be borrowed for the NBN will not affect the budget bottom line and could not be redirected to flood recovery efforts demonstrate that she is disingenuous, out of her depth or both.

For the benefit of the new Finance Minister here are the facts about the NBN.

If the following ‘answers’ are Robb’s idea of facts, then Australian politics is a scarier place than I ever imagined. He’s either totally incompetent or the most accomplished bullshit artist in Australian history. And that’s a big statement!
Question: Where will Penny Wong get the at least $27.5 billion that the NBN Co requires in government equity?

Answer: She will have to borrow it.

Question: Is the money interest free?

Answer: Of course it’s not. Treasury conservatively assumed an interest rate of 4.9 per cent.
Note the weasel words in there. “Treasury conservatively assumed”. Let me translate to what he wants the reader to see: “Those moronic stooges at Treasury took a rough guess and think it will be at least 4.9%”.

Bullshit. Treasury are well aware of the Australian Long Term Bond rates, which is how the NBN will be funded. If Robb isn’t, then maybe he can speak to his broker.
Question: Do the interest repayments hit the Budget bottom line?

Answer: They certainly do and could amount up to $2.4 billion alone by 2013-14.
Now that one redefines bullshit!

$2.4bn by 2013/14???? I don’t know what planet Andrew Robb is on, but it’s not Earth. Even if every cent of the Government’s $27bn is invested in NBN Co by 2013/14 (which it won’t be), the Government Bond Rate would have to increase by 100% in two years for Robb’s figures to be accurate. It’s like saying NASA could achieve faster-than-light travel by 2013!

Robb also conveniently leaves out the fact that NBN will have a higher return than the bond rate. In other words, it will earn more than the interest charges.

Question: Could the money she will borrow for the NBN be redirected to assist the flood reconstruction effort?

Answer: Of course it could. And if it was via public/private partnerships it would remain off budget.

More bullshit. You can’t redirect the NBN debt to flood relief. Or more accurately, there’s no point doing so. The NBN will earn a positive return. That is, the income from it will be more than the interest charges on the debt that’s funding it.

As for the next paragraph…What is this moron thinking? “Keep it off-budget via public-private partnerships”? The NBN is off-budget because it makes a positive return. If Robb can explain how the rebuilding of publicly-owned infrastructure by private industry can make a positive return to Government (without imposing a toll), then I’ll eat my Akubra.

Is Robb just lying, or does he seriously not have any comprehension of finance? Either way it’s a worry that this guy could one day be a Government minister.

Question: Could the government reschedule the NBN construction timetable?

Answer: Yes. In the same way it has brought forward plans to build NBN satellites by five years in response to political pressure.

Yes, the NBN could be delayed. It just wouldn’t make any difference to the flood rebuild.

While the timetable for satellite construction is totally irrelevant to the floods, it’s worth noting that Robb is inaccurate in his claim that the satellite build was brought forward by 5 years, further demonstrating his dishonesty and incompetence on the NBN topic. The satellites are scheduled for launch in 2015, which is about 2 years earlier than first planned. What has been advanced by 5 years is that NBN Co will begin offering a temporary satellite service using existing satellites until their own can be launched. So  Robb is either incompetent, in that he apparently didn’t know the difference between building and operating satellites. Or he’s just being dishonest in simply making incorrect claims.
Question: Will the NBN generate income over time to taxpayers?

Answer: Nobody knows, because the government refuses to subject it to a cost-benefit analysis.

Bullshit meter off the scale. As a finance spokesman, Robb is aware that a CBA is most certainly not required to predict a return or not. Such a claim is beyond absurd. When international accounting firm KPMG studied the NBN, they found that not only would it generate a return, but that the fibre component could be increased beyond the proposed 90% coverage to 93%, and it would still earn a return of 7%pa.

Robb is just using this question to continue the party line that a CBA can predict as-yet unknown benefits. Thank God Robb wasn’t running the show when the telephone was proposed, or we’d still be using smoke signals!

After reading the above collection of absolute bullshit, I truly doubt that Andrew Robb can lie straight in bed. Considering the plethora of embarrassing gaffs he made during a pre-election press conference, I wonder how long the party will keep this moron on the front bench.

Friday, December 31, 2010

If you can't build it, smear it

It’s become quite clear which tactics the Liberal-National Coalition will be using to stop Australia’s National Broadband Network. In the absence of any realistic alternative plan or a technical argument against the NBN, they have stooped to what every politician knows best – The smear campaign.

It began back in August when outspoken Liberal pollie, Andrew Robb, described the NBN Company’s staff as “talentless”, and the organisation “incapable of attracting quality staff”. A cheap, ill-informed slur which is typical of Robb, who has a habit of resorting to FUD when he can’t find any facts to support his agenda. It probably backfired though, given that just about every IT news site (and even a few mainstream media publications) quickly ridiculed his statements, pointing to the fact that the NBN’s staff were in fact highly qualified and respected industry heavyweights.

The NBN Co’s Kevin Brown noted that more than half of NBN’s top 100 staff were senior veterans of global telecommunication companies. Over 50% held two university degrees and there were also 4 doctorates and 27 engineers amongst the management team.

Even NBN opponents jumped to their defence, with Pipe Networks founder Bevan Slattery describing NBN Co as a “brains trust” who have “really got their you-know-what together”.

Fast-forward to December 2010, and the Coalition belatedly becomes aware of bribery charges levelled against a few Alcatel-Lucent subsidiaries between 2001 and 2006. I’ll bet Abbott & Co are kicking themselves that they didn’t pick this up when Alcatel announced it (along with the dismissal of those responsible) in their 2008 annual report! What finally tipped them off was the United States SEC announcing the fines of $137M that Alcatel-Lucent would pay for the crimes.

Why was this so exciting for Abbott, Turnbull and Robb? Because the NBN’s acclaimed CEO, Michael Quigley and their CFO, Jean-Pascal Beaufret both held senior positions at Alcatel during the period of the offences. The fact they had nothing to do with the rogue actions of a couple of morons working for company subsidiaries didn’t dent the Libs’ enthusiasm one little bit. The fact that the SEC were so convinced of their innocence that they didn’t even seek to interview the pair mattered even less. Like sharks circling a hapless swimmer, Turnbull and Robb smelt blood and saw a chance to finally sink their teeth into the project that cost them the 2010 federal election.

The initial attack came from Malcolm Turnbull, but he became suddenly silent and was quickly replaced by Robb. A curious move, considering that opposing the NBN is Turnbull’s responsibility. What could have caused such a rapid and unexpected withdrawal?

And then the answer came, courtesy of the #nbn tag twitter stream. Turns out that during Turnbull’s 3-year position as a global Partner at the massive investment bank Goldman-Sachs, the company broke numerous laws relating to insider trading, laddering and other financial fraud. Resulting in numerous prosecutions (and fines totalling hundreds of millions of dollars) from…. wait for it… the SEC! (Links here and here and here and here) I guess Malcolm found it just a tiny bit hypocritical to attack Quigley when he was in an almost identical position himself, and so left Robb to do the dirty work.

And dirty it was. Of course there were the expected inferences that Quigley must have known what was going on (after all, we all know that the 2IC of every major corporation knows everything that his 100,000 employees are up to). However, there were also Robb’s outright lies, like telling a couple of radio audiences that Alcatel had been made the “sole supplier” of telco equipment to NBN Co. Apparently Robb’s first rule when smearing is “Don’t let the truth get in the way of a good story”. The fact is that NBN equipment contracts have gone to several providers, including contracts to Alcatel-Lucent’s biggest rivals, Nokia-Siemens (A$400Million) and Cisco Systems (A$10Million).

Interestingly, Opposition leader Tony Abbott didn’t mind jumping on the bandwagon, despite facing a bribery scandal of his own. Worse, one of Abbott’s own MPs has tried to secure a $12million kickback for brokering a coal deal in Queensland. One wonders why Abbott considers Quicgley responsible for the corrupt conduct of a subsidiary employee, but doesn’t consider himself responsible for the corrupt actions of a senior Liberal MP whom he personally endorsed?

No doubt we can look forward to at least a couple more years of lies, smear and FUD from the technological incompetents at the Coalition, who are becoming increasingly confused about how to oppose the almost universally-wanted NBN. The only question is: Will they finally wake up and let NBN Co get on with it? Or will the coalition broadband policy comprise a piece of string and a couple of tin cans long after the rest of the world has left us in the dust?