[Linux-aus] Political Recognition for Technology in Australia - was Re: Seeking feedback - EFA Citizens Not Suspects campaign

[Russell Coker]

On Fri, 28 Jun 2013, Charles Gregory <la.lists at chuq.net> wrote:
> It's also worth pointing that the build cost is being spread over ten
> years, and the actual lifespan of the network is often stated as 50 to 100
> years.
>
> Given 50 years - $98 per household per year.  Even if costs double, an
> absolute bargain for the resulting infrastructure.

If the $37.4 billion build cost is spread evenly over 10 years then by the end 
of the 10 year period it will have cost 
3.74*(1+1.07+1.07^2+1.07^3+1.07^4+1.07^5+1.07^6+1.07^7+1.07^8+1.07^9) 
== $51.7 billion in 2022 dollars given that money invested in the stock market 
could get a 7% return per annum.

That would mean a $6799 cost for each of the 7600000 households.

http://www.yourmortgage.com.au/calculators/repay_basic/

I used the above web site to calculate repayments on a 50 year loan with a 7% 
rate and it came out as $40 per month.

> The NBNCo's business plan also states that the company will be debt free by
> about 2030, at which point the company will be returning $2-3 billion a
> year directly into the Government budget.

If there's $2 billion returned to the government then there will probably be 
at least $2.5 billion in revenue.  If we divide that by 7600000 households 
then that's $329 per household as NBN REVENUE.  But no-one at all will ever 
pay just for NBN, they pay NBN fees as part of an ISP subscription, the ISP 
provides data access, services such as a mail server, a help desk, and makes a 
profit.  So if every single household in Australia signs up for the NBN then 
they would each be paying $500+ per annum for ISP service unless there were a 
small portion of the population paying significantly higher rates.  But the NBN 
price model only supports paying 4* the base rate from what they've told me (4 
ports on the router) so that won't work.

My parents pay $600 per annum for home phone service and Internet.  I don't 
think that model would allow for a $329 NBNco revenue from them even if they 
wanted to switch.

Kogan offers a nice 3G connection with 6G of data per month for $300 per annum, 
that would cover the Internet needs of a good portion of the population.  If 
some portion of the population choose not to use the NBN then that means 
either the government gets less revenue than they would like or the other 
customers pay more.

The numbers just don't add up for the NBN as a commercial venture, we need to 
stop considering it as such before the government starts treating it like a 
toll road and cuts off competition.

-- 
My Main Blog         http://etbe.coker.com.au/
My Documents Blog    http://doc.coker.com.au/