The $51 billion National Broadband Network will be completed on time and within budget by mid-2020, according to the project’s chief executive Stephen Rue.
- The network is now 85 per cent complete compared to 75 per cent a year ago
- Revenue is up 43 per cent to $2.83 billion with earnings before tax of $608 million compared to a $103 million loss last year
- The NBN now has 5.53 million customers, up 37 per cent
The NBN is now in its most critical phase with the completion deadline looming and growing concerns the cut-price model might be superseded by the rollout of the 5G high speed mobile network.
But Mr Rue is defying critics of the NBN with strong financial results for the year to June 30, which show the network is now 85 per cent complete compared to 75 per cent a year ago.
“We’re very confident about the completion of the build by June 2020. This year alone, we made three million premises ready to connect,” Mr Rue told the ABC’s AM program.
“Next year there are certainly a lot of complex areas that we need to build out to. But whenever you go out across a whole nation there are always complexities.”
Total revenue for NBN Company is up 43 per cent to $2.83 billion with earnings before tax of $608 million compared to a $103 million loss in the previous financial year.
The NBN now has 5.53 million customers, up 37 per cent, with improved revenue per user of $46 and improving levels of customer service.
Former NBN chief executive Bill Morrow, left, with his successor Stephen Rue, right, at Senate Estimates in 2018. (News Video)
Mr Rue rejected suggestions the NBN is a “cut-price lemon” and that its value will need to be written down by the federal government if it can’t be sold to the private sector after completion.
“A write-down is an accounting concept and given the strength of our business there is no requirement to adjust the current value of our assets,” Mr Rue said.
“What I say is that when I travel around Australia, I have people tell me how their kids are educated because they have access to broadband, which has become an essential part of peoples lives.”
Mr Rue also dismissed suggestions from analysts and the ratings agency S&P Global that the rollout of lightning-fast 5G mobile technology would supersede the capacity of the NBN.
“I would point out that the NBN already competes with mobile today. Around 95 percent of all data is carried on fixed line,” Mr Rue said.
“And we very much think the mobile networks or 5G will be will be a complimentary service to NBN.”
Taxpayers spared another top-up request
The peak budget for the NBN was increased last year to $51 billion after higher costs of the rollout and deferred revenue.
The original $29 billion budget was topped up in 2017 by a special $19.5 billion loan from the Federal Government, which Finance Minister Mathias Corman said was negotiated on commercial terms.
However, Mr Rue said NBN Co would not be asking taxpayers for another top-up.
“That $51 billion still remains the budget and we will complete the build next year and generate strong cash flows going forward,” Mr Rue said.
Complaints have dogged the roll-out process and tarnished the NBN’s reputation. (Supplied: NBN)
The rollout of the NBN has been plagued with complaints from households and business, some of which have been investigated by the Telecommunications Industry Ombudsman.
Mr Rue says the NBN Co is working with retailers to resolve problems that have harmed the NBN’s reputation.
“I hate it when people don’t get a good service. We recognise that there is more work to be done in working with retail partners to provide better customer service in accordance with community expectations,” Mr Rue told AM.
Mr Rue played down concerns that the NBN was discussing the option of premium services with retailers for special bandwidth to ensure the smooth streaming of high definition video from services such as Netflix.
“We want to ensure that consumers get an excellent experience and that was part of the consultation process,” Mr Rue said.
The NBN was initiated by the Rudd Labor government with an original blueprint to roll out a fibre to the node (FTTN) service to approximately 98 per cent of premises by June 2021.
However, the Abbott government with then-Communications Minister Malcolm Turnbull dramatically changed the rollout plans to include a mix of technology including fibre, satellite and copper wire.
Follow Peter Ryan on Twitter @peter_f_ryan