Australian Executive Slams High Cost Estimates for National Broadband Network

WASHINGTON, June 30, 2010 – In a statement released today, Australia’s National Broadband Network (NBN) Co-Chief Executive Mike Quigley called recent estimates of the network’s startup cost “nonsense.” While most mainstream estimates of the cost to build Australia’s new network range from $43 billion to $60 billion, Quigley insisted that the actual cost of the network would run closer to $30 billion.

National Broadband Network Co-Chief Executive Mike Quigley

“”For the record, the amount of money that the government will need to put into this project, which comes from our business case and aligns closely with the implementation study, will be south of $30 billion,” Quigley said. “$43 billion is a different number.”

Quigley’s statement comes just as the NBN is considering an $11 billion cooperation agreement with Telstra, a private telecommunications company, for assistance in building Australia’s national network. Telstra already has infrastructure available to run the network, supporters of the agreement argue that it could bolster revenues for the NBN, while cutting down operating costs. Quigley, however, remained skeptical.

“People who keep talking about commercial returns have lost the focus that this is a big national asset that is being built by the government,” Quigly said. “No commercial entity would do this, and you wouldn’t expect them to, because their job is to get the highest possible return for their shareholders.”