Australians don’t care who owns the NBN, they just want better broadband

In a move that surprised industry insiders and seemingly came out of nowhere, the government maneuvered last week to ban any privatisation of NBN Co, introducing new laws that would keep the nation’s broadband infrastructure in public hands for the foreseeable future.

The NBN is “not for sale”, according to Communications Minister Michelle Rowland, who told a Canberra press conference that public ownership of the network would ensure continued investment and lead to decreased prices.

Communications Minister Michelle Rowland says public ownership will continue.Credit:

“It is not a complex question here. You either want to keep the NBN in public ownership, or you don’t,” Rowland told reporters on Wednesday.

But for NBN providers such as Telstra and Optus – and Australia’s millions of NBN users – there are vital, and in some cases complex questions that remain unanswered.

Ziggy Switkowski, a former chief executive of Telstra and Optus, served as chairman of NBN Co for nearly a decade, between 2013 and 2021. He compared the government’s handling of NBN ownership to its handling of nuclear power. He said it represents short-term thinking.

“The decision to hold NBN in government ownership is fine for the short term, say this decade,” Switkowski said. “But beyond that horizon why do it?

Communications Minister Michelle Rowland during question time last week.Credit: Alex Ellinghausen

“It feels like the ban on nuclear power – why do it?”

“Why do it?” was the central question last week.

And what will the impact be for end consumers?

There’s broad consensus that the impact on the nation’s broadband will likely be minimal in the short term. Most consumers don’t care who owns the NBN, and often even which provider they’re with. They care that Netflix and Stan work and that their Zoom calls don’t drop out.

Ziggy Switkowski says Labor’s handling of NBN ownership represents short-term thinking.Credit: AFR

Over the longer term, however, industry insiders say that settling the issue of ownership should indeed have a significant impact, including likely lower prices for consumers.

Optus interim chief executive Michael Venter welcomed the government’s legislation. Venter has one more month left in Optus’ top job, before he’ll be replaced by former NBN Co boss Stephen Rue.

“Keeping this critical asset under government ownership is likely to be the best approach for Australian consumers,” Venter said. “It will also provide a welcome level of ongoing certainty to the sector.”

For Optus rival TPG, which operates a large swath of NBN brands including Vodafone, iiNet, Internode and AAPT, the time for politicking over the NBN has long been over.

“It is crucial that Australians have access to good quality and affordable broadband,” a spokesman said.

“With its long-term future as a government-owned entity, NBN should focus on reducing cost-of-living pressures and maintaining predictable and reasonable pricing.”

The politics is still playing out, with the bill introduced on Wednesday and currently sitting before the House of Representatives.

Opposition communications spokesman David Coleman.Credit: AFR

Opposition communications spokesman David Coleman hasn’t yet revealed the Coalition’s position but criticised the government for its handling of the process, including what he characterised as rushing a debate on the legislation.

“Today we have seen a frantic rush by the government to force a debate on legislation, even before it briefed shadow ministers on the contents of the bill,” he said on Wednesday.

“This is a sad and pathetic stunt from a failing Labor government. It is a problem in search of a solution from a minister in search of some competence. The Coalition will consider this planned legislation through normal processes, rather than buying into another Labor stunt.”

The Greens are pushing for a Senate inquiry, in a bid to examine issues including executive pay – a recurring issue for NBN Co – as well as the quality of service and affordability.

“We need to ensure the digital divide is not growing and everyone can participate in our digital economy,” Greens senator Sarah Hanson-Young said on Wednesday.

“The Greens also want to see the exorbitant bonuses paid to NBN executives reined in.”

The move also got tongues wagging among industry analysts, who wonder about the possible motives at play for the government. Industry veteran Paul Budde said the decision was based on a harsh reality that privatisation would mean a very significant amount of money would have to be written off, which would be a political disaster for both parties.

“The landscape has changed in a geopolitical and a cybersecurity sense,” he said. “Privatisation would limit certain investors and the amount of regulation and legislation would again limit the price somebody will pay for it.

“The financial reality will make that politically impossible.”

For Budde, telcos worldwide are under increasing financial pressure, with shrinking profits and stagnant revenues. 5G networks have been expensive to build out but have failed to deliver the revenue boost once promised, and broadband revenue is plateauing as well.

“This raises a critical question: how will telcos continue investing heavily in new technologies without substantial revenue growth to justify those investments? This dilemma will undoubtedly influence any potential NBN sale,” he said.

“For the government, offloading the NBN at a time when the market is sluggish would likely mean accepting that they won’t fully recoup their investment.”

The numbers back up Budde’s assertions: NBN Co recently reported a $1.4 billion net loss, up from $1.1 billion the previous year, driven by the heavy cost of maintaining and upgrading the network. As of June, NBN Co was carrying $42.5 billion in liabilities including $26.9 billion in debt.

It paints a muddled financial picture for a company that doesn’t have any obvious suitors.

Mark Gregory, an associate professor at RMIT University, agrees that selling off NBN Co at this point would be too tricky for a multitude of reasons.

Australia ranks 82nd among the world’s countries for internet speeds.Credit: James Alcock

“My view is that if it was to be sold off, then it would need to be very heavily regulated. A simpler option is for government not to sell it off,” he said. “I think it’s a good decision to finally identify where the government sees NBN Co sitting. It’s good for it to remain where it is.”

Many consumers, however, just want the politics to be over with. They want broadband that just works, and is affordable. Australia’s average fixed broadband download speed at 66.58 mbps is ranked 82 on Speedtest’s worldwide index, behind Oman and Czechia and just above Uzbekistan.

Monthly data use has grown tenfold in Australia over the past 10 years, skyrocketing particularly during the COVID-19 pandemic, and growing each year since.

Vincent Candrawinata says unreliable internet makes operating a business difficult.

Vincent Candrawinata, otherwise known as “Dr Vincent”, runs a skincare and supplements business called Renovatio that works with farmers across the country. He said he was regularly told how unreliable the internet was.

“The current state of the NBN is not very good at all ... We have to boost and supplement with the 5G network which essentially doubles our cost,” he said.

“Farmers and retailers constantly tell us how unreliable the NBN is. It seems to vary in reliability and consistent quality from place to place and area to area, which actually makes things worse because it creates inequality and makes doing business very challenging.”

He would like to see more affordable and faster internet.

“Unfortunately, it still feels like a luxury for a large chunk of Australians. Shifting the focus from political debates to practical solutions for improving broadband for end consumers is absolutely critical.”

Others, particularly those in more urban areas, are happy with what they view as a service that has markedly improved in recent years.

Daniel de Vries is based out of Brisbane and runs his small business, AIC Connect, from his home.

“I’m on fibre NBN, and I chose the 1 gigabit plan specifically so I can do a lot of video conferencing, which is how I connect with most of my clients nationally and internationally,” he said.

“I’m actually pretty satisfied with the product and its cost. I wouldn’t be able to operate without it.”

NBN Co, for its part, says it is just getting with the job, which right now means speed and capacity upgrades.

It’s targeting a September 2025 launch for a major wholesale speed upgrade, which would effectively make the network five-times faster. The company’s “Home Fast” product would jump from 100 megabits per second to 500 megabits per second, and “Home Superfast” download speeds would triple from 250 megabits per second to 750.

“We’ve just completed six months of consultation on how we will leverage the full power of our roll-out of fibre to support the nation’s growing data demands,” a spokesman said.

“We’re in alignment with industry on this and they are very supportive.”

Alignment in this sector is rare, and the nation’s broadband users will be hoping it can stick.

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