NBN Business case released!

[mellie]

And roll on every other promise the Labor party have failed to deliver on to date,

[Jovial Monk]

I love old biddies like this! I really do! One foot in the grave this old duck still had enough energy and enterprise to take two fucking countries off line while stealing scrap to sell!

Granny takes down web in two countries

Your cable, my shovel.

A 75-year-old scrap metal scavenger has managed to take two countries offline when she whacked her spade through a fibre cable in the Caucasus.

While hunting for saleable loot, the septuagenarian sliced through the main pipe providing connectivity for Georgia and Armenia, reportedly cutting off access to 90 percent of Armenian homes and businesses, while also hampering Georgian ISPs.

“She found the cable while collecting scrap metal and cut it with a view to stealing it,” Georgian interior ministry spokesman Zura Gvenetadze told news agency AFP.

The woman was taken into custody in Ksani, north of Tbilisi and faces three years in prison, although she has since been released to await trial.

“Taking into account her advancing years, she has been released pending the end of the investigation and subsequent trial,” Gvenetadze said.

The company responsible for the fibre - Georgian Railway Telecom - seemed suitably embarrassed that one woman with a spade could cause such damage to apparently non-redundant international infrastructure.

http://www.itnews.com.au/News/253809,gr ... tries.aspx

[Super Nova]

Monk,

here is the first sign that my prediction that this will turn into a white elephant and cost alot more than they thought. The business plan is flawed. The project should be stopped until a real business plan and floated and approved. This is going to fail and not deliver.

http://www.theage.com.au/technology/tec ... 1d6xx.html

NBN build cost 'underestimated': analysts Ben Grubb
April 8, 2011 - 12:39PM
.The $36 billion national broadband network is headed to a significant cost blowout, analysts say, after the the company building it failed to accurately predict the cost of construction when it took it to the market.

Last week the company building the network, NBN Co, wrote to 14 construction firms saying a key tender process was ''suspended'' indefinitely because none of their proposals had acceptable prices.

Following the suspension, NBN Co’s head of construction resigned, fuelling speculation from Telsyte analyst Chris Coughlan that he was "responsible for the assumptions in the business plan associated with the construction costs". He made a "substantial mistake" and wasn’t "able to land the deal".

Advertisement: Story continues below And just today, The Australian reported that the company's manager of cost and resource estimates, Nick Sotiriou, had also left the NBN Co. "From time to time people have differences of opinion and that doesn't mean one is right or wrong," he told The Australian. "And sometimes you have to move on."

The newspaper also reported yesterday that companies it surveyed that had put in a bid for the construction placed a 50 per cent premium on the cost because NBN Co placed a lot of the build's risk on them.

The NBN Co would now be looking at ways to try and lower the cost of construction, such as looking at the amount of overhead and underground cabling, Telsyte's Coughlan said. Overhead cabling was sometimes cheaper, he added.

NBN Co made the move to suspend the build tender because it believed the bidders were trying to gouge excessive profits from the taxpayer-backed project. But, according to some telecommunications analysts, rather than price gouging occurring between bidders, the company may have underestimated the build’s cost.

“I would find it very hard to believe and very legally difficult to demonstrate collusion or a conspiracy has taken place,” said IBRS analyst Guy Cranswick.

He said the ICT industry had been “very buoyant” about the NBN because there was a “certain amount of self-interests that may [have] come into play”.

“Now whether that motive has proved to show higher prices is very difficult to prove,” he said. “There could be an underestimation on one side but there could also be a certain enthusiasm about working for a government backed corporation”.

Ovum telecommunications analyst, David Kennedy, said it was “clear” that the tender process hadn’t “delivered a result consistent with the [NBN Co] corporate plan”.

And despite the company’s claim it had been gouged, it was “difficult to see” how that “could be sustained in a competitive process that’s been going on for five months and in which there’s been ongoing negotiations between NBN Co and the tenderers”.

Independent telecommunications analyst Kevin Morgan said the idea that fourteen different companies “would all get together and all inflate their prices” was “not realistic”. “It’s just not on.”

Morgan believed the build's cost had been underestimated and said that it “wouldn’t be surprising” if the prices all came in at a roughly comparable level “because the inputs are all pretty well known”.

“Where it may differ is in the element of risk that the contractor wants to build into [their bid] because this is an extremely risky project from the contractor’s point of view.”

Telecommunications analyst Paul Budde also questioned the gouging claim. “If there was only one company or two companies involved with it” it may be reasonable to suggest such a thing occurred, he said. “But there are fourteen companies involved with [the tender]. They can’t all work in that way. So I don’t think that that is a reality; that all of them in one way or another have created a situation of gouging. I find it very, very hard to believe. I mean, perhaps 20 years ago in the construction industries things like that were happening but the construction industry has become extremely professional in Australia and I can’t see that that could happen on a massive scale”.

He said there might be “one or two” companies who would try to “use or misuse” the tender process “but I don’t accept that the total construction industry would do that”.

“So I think it, NBN Co, might refer to one or two situations where it feels or expects that some of that has taken place but I don’t accept that that would apply to the whole industry.”

The gouging ideology was also rejected by Telsyte's Coughlan. For price gouging to occur, he believed that there would have had to of been collusion. “And I very much doubt there’s collusion,” he said. “The whole price gouging thing, I think, is a bit of a misnomer. I don’t believe that [the bidders] are price gouging. I think some of the respondents have probably done a fair bit of work in understanding the costs and this is probably a big issue for NBN Co in that their business plan assumes a certain [capital expenditure].”

Coughlan said one of the options NBN Co would be looking at now would be partnering with Telstra on the construction of the NBN rollout further than it already plans to. “However, at the end of the day, Telstra is going to be using the same sub-contractors that all these construction firms will be using. So the costs really aren’t going to substantially change that much.”

Budde said Telstra was in a “unique position” to offer the services that NBN Co was seeking in the tender but said that it “would be very difficult” for NBN Co to give it to them because there “would be in uproar” with people afraid that Telstra was becoming “so dominant in the NBN business”.

Delays to the rollout as a result of the tender suspension were inevitable, IBRS' Cranswick said.

“This will add more time and more delay and of course that will cost money,” he said.

“I think all of these things add delay. They all compound, they all knock on. And they all of course mean that corporations with a large public quota have to consult with their executive boards and discuss how they manage strategy, how they manage their dealings with such a large corporation such as NBN Co. So yes, it causes delays all the way down the chain; It produces a kind of negative feedback loop if you will.”

One analyst, who wished to remain anonymous, said that NBN Co may even look to setup their own construction operation if they couldn’t get the market to do the job at the price they wanted. “[The] easiest way to kick that off would be to buy a construction company," they said. “[But] that’s going to delay the project and they’ve said there’s not going to be any delays."

The other option, the analyst said, was for NBN Co to "basically buy [a construction company]" and build the network itself.

When NBN Co announced the indefinite suspension of the tender, a spokeswoman for Communications Minister Stephen Conroy said it expected the company to "negotiate the best rates on a building project, and that's exactly what NBN Co are doing".

Opposition communications spokesman, Malcolm Turnbull, said the suspension underlined the risk of cost blowouts, and cited industry claims the government was underestimating the NBN's cost.

[Jovial Monk]

I see, so NBN Co not accepting bids that had been inflated is proof costs will blow out? Give me strength!

[Jovial Monk]

Good, one of the NBN Co guys made a long detailed post over at Whirlpool:

http://forums.whirlpool.net.au/forum-re ... ?t=1675718

Gets quite technical—there was a question about the cancellation of the 14 tenders, hope that gets answered soon and hope we see frequent appearances by other NBN Co managers etc.

Roll on NBN. . .

[harry climber]

The NBN will become the biggest white elephant in Australia's history.
And with the cost blowout anticipated in being twice the imiginative understated ALP value of $34b Australia will long be searching for means of paying for this cost.

[harry climber]

The NBN, made of premium optic fibers, nothing possibly could go wrong - or could it.

"An elderly Georgian woman was scavenging for copper with a spade when she accidentally sliced through an underground cable and cut off internet services to nearly all of neighboring Armenia. The fibre-optic cable near Tiblisi, Georgia, supplies about 90% of Armenia's internet so the woman's unwitting sabotage had catastrophic consequences. Web users in the nation of 3.2 million people were left twiddling their thumbs for up to five hours. Large parts of Georgia and some areas of Azerbaijan were also affected. Dubbed 'the spade-hacker' by local media, the woman is being investigated on suspicion of damaging property. She faces up to three years in prison if charged and convicted."

"A 75-year-old woman was recently arrested by the Georgian police after she single-handedly cut off Internet connections in Georgia and neighbouring Armenia.
AFP reports that the pensioner was digging for scrap metal with the intention of stealing it when she stumbled upon a fibre-optic cable which runs through Georgia to Armenia, forcing thousands of Internet users in both countries to lose Internet connection for several hours. Georgian Railway Telecom, the company that owns the cable, said that the latest damage was serious, causing 90 percent of private and corporate Internet users in Armenia to lose access for nearly 12 hours while also hitting Georgian Internet service providers.
“I cannot understand how this lady managed to find and damage the cable. It has robust protection and such incidents are extremely rare,” Giorgi Ionatamishvili, Georgian Railway Telecom’s marketing head, told AFP.
Apparently, this wasn’t the first time it happened. In 2009, another scavenger damaged a fibre-optic cable while hunting for scrap metal in the impoverished ex-Soviet state, forcing many Georgians’ Internet connections to get interrupted.
The woman has been charged with damaging property and could face up to three years in prison if convicted."


If only they had something better than cable.

[Jovial Monk]

Bias is not analysis. There has been no blowout in cost, the opposite in fact. With video over IP booming there will be a bonanza of revenue for the NBN. Not only that, the increasing austerity world wide will very possibly see a new Long Depression clamp down and if that happens the NBN will be even more valuable in boosting the Australian economy/health/education etc.

[harry climber]

Monk,

here is the first sign that my prediction that this will turn into a white elephant and cost alot more than they thought. The business plan is flawed. The project should be stopped until a real business plan and floated and approved. This is going to fail and not deliver.

You're not alone in your predictions nor of your depiction that the NBN is an overblown white elephant.

[Jovial Monk]

The same for me for Christmass please Santa! Even in Tassie more and more are being connected! 11ms ping Midway Point Tas to Melbourne!