Australian Minister asks entire NBN board to tender resignations

Australian communications minister Malcolm Turnbull has asked the entire board of the country’s national broadband network (NBN) project to tender in their resignations. Australia’s NBN is a national wholesale network currently being rolled out across the country, but has been hit by multiple delays for various reasons.

Turnbull has previously been critical of the board in complaining that none of its members has any previous telco experience and that they did not do enough to rein in network costs and correct the mistakes that were being made, according to Tony Brown, senior analyst for Asia Pacific at Informa Telecoms & Media.

“The new chairwoman Siobhan McKenna has only been in the job a few months, having taken over in March. She came in and tried to stop the problems, but that looks like a mistake for her personally,” said Brown.

He added that it began to become apparent that she would be unlikely to remain in her role when Turnbull took over, following Labor’s defeat in the 2013 Australian federal election.

“It looks like her taking the job at NBNco under the Labor government infuriated Turnbull and his people and now it seems she’s going to be shown the door. There’s a lot of internal politics involved in this,” Brown added.

Turnbull may have asked the board to tender their resignations rather than to resign because he is not planning to accept all of the resignations.

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“He is likely to keep two of the existing members on the new board and will accept four resignations,  very likely including that of McKenna,” said Brown. The remainder are expected to join the new executive chairman Ziggy Switkowski, formerly CEO of Telstra. “He has not been officially appointed yet but it’s only a matter of time before he is announced,” Brown said.

The first order of business for the new board will be to fill its remaining seats, probably with executives who have telco experience. The board will then begin three reviews: a strategic review to find out what has happened over the past four years and to report on how much the network would actually cost if it was completed to its current specifications;  a political review focusing on what mistakes were made and why; and a full cost benefit analysis.

“The final review is going to determine what should be done,” said Brown. “What really matters is the question you ask, how you phrase it and what you want to find out. If the question is “how do we get to a future proof network? The answer is to deploy fibre everywhere. If it’s “how do upgrade our broadband in Australia efficiently in terms of money and in the fastest possible time – it may be a fibre to the node rollout using vectoring and VDSL. The outcome depends on how things are phrased and what questions are asked.”

The three reviews expected to be conducted before Christmas 2013.

In February this year, Turnbull voiced his belief that Australians could be offered on-demand access to fibre-to-the-home (FTTH) connections as part of the nationwide rollout of fibre-to-the-node (FTTN)in a manner similar to UK fixed line provider BT.

Then in June, he argued that LTE had greater capacity to compete in the market against fixed-broadband in the residential market.