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Broadband network hangs in the balance -

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KERRY O'BRIEN, PRESENTER: The fate of the largest and most expensive infrastructure construction
project in Australian history, the National Broadband Network, hangs in the balance at this

This is one area on which the difference between the major parties is clear.

The Government is adamant the new telecommunications network will propel Australia into the digital
future and lift the nation's productivity, but the Opposition says it is an extravagantly priced
white elephant that should be aborted.

Business editor Greg Hoy reports.

MIKE QUIGLEY, CHIEF EXECUTIVE, NBN: Everybody's a little too busy at the moment to be worried. I
can't say what's inside their heads of course, but I can tell you what I see in the day-to-day
working of the company, and that is people are just simply getting on with the job.

GREG HOY, REPORTER: In the hot seat, global telecommunications expert Mike Quigley, the $2 million
dollar-a-year man whose job is to design and build Australia's $43 billion National Broadband
Network is, like the 250 administrative staff he's already hired to help, now caught between
colliding political forces of election 2010.

JULIA GILLARD, PRIME MINISTER (9th July): Key to unlocking our potential is the National Broadband

TONY ABBOTT, OPPOSITION LEADER (9th July): Some $22 billion of debt will be eliminated through not
going ahead with the Government's nationalised broadband network.

MIKE QUIGLEY: I think it would be a pity if the National Broadband Network didn't go ahead. I think
it is a very important piece of national infrastructure.

GREG HOY: In trying to ignore the sword hovering over its head, it's business as usual building the
largest infrastructure project in Australian history that will, over eight years, conscript 20,000
workers at its peak to connect 11 million homes and businesses across the country. The Government
recently rolled out prime time advertisements in support of the $26 billion it will invest in the
project to maximise competition. $18.3 billion dollars of that in the next four years, all it's
hoped will eventually produce a profit, all will eventually be privatised.

But in so many ways, this is history repeating. Through the 1900s, government rolled out the
nation's old copper network for the humble telephone. Today, it's government striving to replace it
with laser light-driven fibre optic cable connected to each and every premises, ostensibly to
accelerate the audio-visual, digital and data revolution.

MIKE QUIGLEY: This is a unique opportunity and one that was very difficult to go past. The
opportunity to build right across the nation, the new infrastructure that will provide the
telecommunications needs of Australia for probably the next 30, 40, 50 years.

TONY SMITH, SHADOW MINISTER, BROADBAND & COMMUNICATIONS: Labor's approach is hugely irresponsible,
relies incredibly on the taxpayer. We think it's reckless and we think there are more responsible
ways to deliver better broadband.

GREG HOY: The same debate loomed large in the lead-up to the last election when the Howard
Government maintained that short of wireless or WiiMax broadband needed in rural areas, Australia's
broadband was quite adequate.

HELEN COONAN, THEN COMMUNICATIONS MINISTER (2007): More than 80 per cent of Australian households
and small businesses already have access to fast broadband.

GREG HOY: But then, speaking to the 7.30 Report, an expatriate IT expert visiting from Paris begged
to differ.

MIKE QUIGLEY (Feb, 2007): We're seeing a rapid acceleration of deployments of fibre-based networks
all around the world, whether it's Japan, Korea, Europe, US, Canada. We haven't even started that
yet in Australia.

GREG HOY: Soon Mike Quigley was lured home from Paris to build the big new network. The Rudd
Government commissioned a $25 million study which found NBN might generate a modest profit, an $11
billion peace deal was struck with the irate former Government telco Telstra to acquire or lease
back its old network infrastructure for the fibre optic future. But the Federal Opposition remains
the NBN's mortal enemy, though is yet to release its own policy.

TONY SMITH: People will have a very clear choice between Labor's irresponsible, reckless plan and
our plan which will be far more responsible and deliverable.

GREG HOY: Will yours be inferior technology?

TONY SMITH: Well, Labor's approach is a one-size-fits-all approach. We - you will see when we
release our policy that we will ...

GREG HOY: Will it be inferior?

TONY SMITH: Well, we don't believe so.

GREG HOY: So it won't be inferior technologically?

TONY SMITH: We will have a plan that will roll out better broadband ...

GREG HOY: Better broadband than the National Broadband Network?

TONY SMITH: Well the National Broadband Network is hugely expensive, never going to be economic.

GREG HOY: Industry expects the Coalition will again propose an upgrade of satellite and wireless or
WiiMax services in rural Australia and rely on existing telcos elsewhere. Such austerity may have
electoral appeal, but support for the NBN cannot be underestimated, even amongst traditional
Coalition constituents. The Australian Industry Group has been a big backer, suggesting the NBN
will lift national productivity. Small business seems equally supportive.

Network is we need it and we need it now. We needed it a few years ago, the truth be known. It's
essential for small business in Australia if we're going to compete with big business, we gotta
have access to high-speed lines. All small businesses will benefit from it, whether you're a cafe,
a hairdresser, a bookshop, whatever. You can go online, you can push your product out there and you
can do it quickly.

GREG HOY: And across rural or remote areas you will hear a similar story.

Once upon a time, all farm stock had to be transported to the saleyard to be sold, but with
broadband-enabled video, today they don't have to leave the paddock.

GARY DICK, GM, AUCTIONS PLUS SYDNEY: The sheep and lambs today on offer, there's 31,000 of them and
they're come from the geographical spread from Longreach in Queensland to South Australia. We have
just on 43,000 registered users at the moment. Currently the biggest limiting factor is for video,
is uploading video from on-farm. It's because of the limitations on file sizes; there is a

GREG HOY: The same is true of rural health. Once upon a time, patients needing medical attention
out where there's no local doctor either had to travel large distances or await the arrival of the
fabled Flying Doctor service. But this is the age of the video doctor. In 40 outlying towns like
Birchip near Victoria's north-western Mallee district, broadband is helping to overcome the tyranny
of distance.

DAVID RYAN, GRAMPIANS RURAL HEALTH ALLIANCE: The National Broadband Network can bring in patients
homes, connect them up to hospitals. And when you do that, it's to dramatic effect and the demand
impacts on health services are then felt less and less. We've hit our limit currently. We've maxed
out our bandwidth. So, we need to ability to get up to those speeds of 100 megabits and beyond, and
even with WiiMax, it does max out at lower speeds.

MIKE QUIGLEY: We are now using video conferences between our links here in NBN Co. between Sydney
and Melbourne so that we no longer have to get on planes anywhere near as frequently. And I think
this will have - start to have a real big impact on small-medium businesses, especially outside

GREG HOY: Life online is only just beginning, but already it's changing newspapers, television,
retailing, data exchange, professional and private correspondence - you name it. So much is
changing in the telecommunications evolution, fuelling the $40 billion debate over the fate of the
National Broadband Network, debate that will only be settled on August 21st.

TONY SMITH: Over the course of the election you'll see our plan. It will deal with the areas where
government should have a major role and it will outline and it will show how the private sector can
play its role to deliver better broadband across Australia.

MIKE QUIGLEY: We just take each day as it comes. We have a set of objectives that have been set by
the Government and we're just getting on with those. So, we, frankly, in the company not paying a
lot of attention on a day-to-day basis, obviously, to the election. We're obviously vitally
interested in it, but we're just getting on with the job and we'll see - we'll see what happens.

KERRY O'BRIEN: Business editor Greg Hoy.