Millions of homes and businesses will gain access to ultra-fast internet under a $4.5 billion upgrade to the National Broadband Network (NBN).
At least eight million premises have the potential to receive up to one gigabit per second by 2023.
The upgrade will be financed through NBN Co. borrowing from private debt markets.
Paul Fletcher, the federal minister for communications, said that with 99 percent of premises now able to connect to the NBN the time was right to upgrade the network.
Fletcher said the pandemic had also changed the way people used the internet, with more employees working from home, and increasing the demand for speed.
The upgrade signals a significant change in the Coalition government’s approach to the NBN rollout.
The NBN was announced in 2009 by former Labor prime minister Kevin Rudd as an initiative to upgrade Australia’s broadband infrastructure and provide consumers with faster internet connections.
The original plan would have seen the NBN network use fibre optic cables to connect the network directly to Australian homes across the country and was slated for completion in 2020.
The Coalition scrapped this approach after coming to power in 2013 in favour of mixed technologies.
Fletcher claimed the Labor approach was costly, slow, and would have left 5 million fewer homes connected today.
Under the Coalition government, the plan was changed to a Fibre to the Node (FTTN) system which saw fibre optic cables rolled out to “nodes” near houses or apartment blocks, and homeowners would then connect via copper wires. Internet speeds however were affected and, in some cases, slower.
However, the latest policy change will see the FTTN system expanded to include “local fibre networks” that will run along streets. Homeowners can decide if they will connect to the network at an extra cost.
The Labor opposition has criticised the announcement saying the Coalition should not have made changes to the original plan.
“This has to be the most extraordinary wasteful public policy backflip in a generation. This government has built a network that costs more and does less,” Labor Communications Spokeswoman Michelle Rowland said.
The announcement comes as the government launches a series of infrastructure spending initiatives aimed at restarting the economy following the COVID-induced lockdown.
“This is a major infrastructure investment which will bring immediate demand stimulation, with some 25,000 new jobs over the next two years,” Finance Minister Mathias Cormann said.
“Longer term it is estimated to increase Australia’s GDP by $6.4 billion per annum by 2024,” he added.
Simon Yuen of Artificial Intelligence Technology with 25 years’ experience in telecommunications, said despite the policy changes, the upgrade was being finance privately and the focus should be on timely implementation.
“The timing of this announcement would appear strategic, and there will always be criticism and potential finger pointing when it comes to the growing appetite for internet bandwidth and the government’s management of the NBN rollout,” he told The Epoch Times on Sept. 23.
Rob Nicholls, associate professor at the University of New South Wales, said consumers would benefits, but ideally the changes should have occurred seven years ago when the Coalition revamped the plan initially.
“In telecommunications, building one thing, changing it and adding to it is never as efficient as building it once and getting it right,” he told The Epoch Times on Sept. 23.
“Consumers can expect two improvements. The first is that they will have access to faster broadband services. The second is that the number of faults and service outages will reduce,” he said.
The latest upgrade will also make NBN a more suitable competitor to 5G services being rolled out but warned the price of connecting to local fibre networks needed to be within the reach of consumers.
Minister Fletcher also appears to be laying the groundwork for NBN Co.’s privatisation after the next election, saying the value of the company was an important consideration with the upgrade.
The independent Parliamentary Budget Office estimates NBN Co. is worth $8.7 billion, while the government values it at $29.5 billion.