Will the NBN be really that fast?

Earlier last month, the Federal Government announced it would establish a new company to build a “new super fast” National Broadband Network (NBN). The NBN is meant to provide 90% of Australian homes, schools, and workplaces with a 100 megabits per second connection to the internet. Taking eight years to build, it’s meant to create over 25,000 new jobs and cost a total of $43 billion that’ll be jointly funded by the Commonwealth and the private sector. Some analysts later worked out, based on providing a reasonable return to the private sector investors, the cost per subscriber for access to the NBN would be around AUD200/month.

I got pretty excited about this: I currently pay around AUD70/month for a cable modem connection at home that gives me about 8 megabits so we’re talking about a pipe that’s 12 times larger for around triple the price. (My cable provider advertises download speeds of 8 megabits but I’ve been assured by my more technical friends in reality I actually receive a fraction of this.)

That was until I read this week’s edition of The Economist. In an article about internet television, the correspondent explains how, in Japan, he currently pays USD60/month for a 160 megabits a second connection from his local cable company. Yes, you read that correctly. Today, in Japan, you can get a 160 megabit connection to the internet for USD60/month, and in the US, there are a bunch of cable companies who charge USD140/month for a 50 megabits a second connection.

Now we Australians are being told it could take up to eight years to build a massive network that’ll only provide 100 megabits. Am I missing something?

While I wholeheartedly agree with the sentiments of the Federal Government, if we really want this to be a ground-breaking Snowy Mountains-like scheme, maybe we need to aim for something higher. The idea of simply providing double the capacity of our American friends over eight years doesn’t sound that appealing, much less so the idea of getting 60% of what our Japanese friends can receive today for a fraction of the price.