NBN: Turnbull's Weasel Words - I

Turnbull appeared on ABC Local Radio, Shepparton, (transcript) repeating his usual phrases and claims. I find his utterances classic use of Weasel Words, not just oversold or misleading, but deliberately obfuscating (hiding) critical issues and slimily phrased so later he can, truthfully, say "I never said that", while now he creates the impression of firm promises and strong statements. But would you expect less in a politician making vapid promises in the hope of getting elected?

1. Attack the Messenger: it's a good strategy when the public has rejected your message and you want to deflect questions. Over multiple questions on why there seemed to be overwhelming public support for Fibre, not Copper, the ABC summarised thus:

"Mr Turnbull said public perception of the Coalition broadband policy could be blamed on the media and that the ABC had spoken mainly with industry analysts and university academics rather than the people who were actually building networks."

If Turnbull thought he had a case of bias at the ABC, or even a systemic approach, he would be following the lead of Richard Alston and lodging a formal complaint. Alston, as minister responsible for the ABC, by 2003 had filed 68 formal complaints, all but two were dismissed.

Attacking commentators, including recognised industry experts and academics, just because they disagree with you, not on the basis of fact is classic weaselling by Turnbull. This is truly "noise and fury, signifying nothing."

2. Turnbull has repeatedly said, including in this interview, Labor is "telling lies about our policy and indeed about their own". Elsewhere he has said in public, repeatedly, that Labor claiming "connection to the (current) NBN is free" is "an outright lie", "Now that is a lie" and in this interview, "outrageously false and terribly misleading".

Turnbull is setting a very high bar for himself by picking at minutiae and using strong language like "outright lie". He's also wrong in his blanket assertion: At least one large ISP/NBN Retailer, iiNet, do not charge setup fees for standard NBN service installations.

How would an "Ordinary Reasonable Reader" interpret the Labor claim "Connecting to the NBN is free"? An Ordinary person would not take the Labor claim on a flyer to mean "in every possible circumstance, with every NBN Retailer, there will never be setup fees".

This a very pedantic and legalistic interpretation of Turnbull's here. It is false logic to say "Telstra and Optus charge their own account setup fee, paying nothing to NBN Co, therefore 'NBN connections are not free'". That conflates retailer fees, warranted or not, with NBN Co charges, a distinction, I believe, that most users understand. I believe they also understand the allusion to current "connection" fees charged for landlines and ADSL services, and that there are tiered, depending on how much work the Telco/Provider needs done. Labor were, I think, attempting to succinctly say "the old standard connection fees are gone".

Turnbull also makes the incorrect logical leap that if "A is not true", then "'not A' is true". This is true in binary logic, not in the real-world. Turnbull is using "the law of the excluded middle", basing something on a false premise, e.g. "Have you stopped beating your dog? Give a Yes/No answer!" (presumes you ever beat anything) or "If you're not at home, then you must be at the office" (presumes you can only be in the home or office, not "down the pub" or elsewhere). 

Labor may have made a sweeping generalisation: a tight, simple statement that Ordinary people (voters) can read quickly and grasp fully. Exactly the sort of thing you'd expect in an election flyer, not a policy document, not a media statement nor in a one-on-one interview. Was that unwarranted or unwise? I don't think so.

Would Labor have been wise to say in the flyer, the more exact: "Connecting to the NBN is free, for standard connections and excluding additional fees retailers might charge". No, I don't think so. People have become increasingly sophisticated as consumers of advertising and towards all political statement (remember "non-core promise" anyone?). As soon as ordinary people see statements with caveats, alarm-bells go off in their heads and they treat the statement with suspicion: they automatically think vendors or politicians are using weasel words to scam them when they add caveats.

Yes, Labor simplified the facts to avoid confusion. Did they generally mislead or misinform? No, I don't believe so.

Were they "lying"? Only in a very legalistic and pedantic sense. BUT, if you adopt that frame of reference and apply the same test to Turnbull's rather over-the-top rejection of the proposition, then he too is wrong.

Using Turnbull's own logic and standards, he is being "outrageously false and terribly misleading" in his accusation of lying. Why? Because not all NBN Retailers charge setup fees in all cases (those with a standard install can get zero setup fees if they choose their Retailer well) - as must be the case for his legalistic pedantry to be 100% correct. And as he is the one attempting to enforce the standard of complete precision and exactitude, then he must also accept that all his statements will be tested against his own standard.

 3. Turnbull trots out the usual "we estimate" it will cost much more "will take many, many years – it could be decades – to complete", and later switches, dropping "estimate". Both pure spin, justified only in the minds of those making up the Coalition estimates. Plus trotting out the usual "you've seen how little progress if any there’s been in ..." is more weasel words. Later he quotes his own worst-case scenario estimate as if it were an established fact, giving it the same credibility as the professionally created, detailed and justifiable NBN Co project budget.

Either Turnbull does NOT understand the nature of large, complex infrastructure projects or he does understand the complexities and realities and is being purposefully disingenuous  and misleading. It cannot be other (this one is binary logic). He is either uninformed and incompetent or knowingly "spinning",  I consider outrageously. Both are NOT what voters respect or desire in a possible Minister for Communications, the role he is advertising and advocating himself to fill.

Big projects always hit delays and unexpected problems, run through many phases, each one needed before the next can continue, and progress cannot be measured in simple counts of "final outputs". That's why Project Management is a difficult discipline and all good project plans, notably NOT the Coalition's, include statements on Risks and their mitigation and include in their budgets a Contingency. (10% in the NBN Co budget).

4. Q: "Do you personally believe that that is the superior option to the fibre to the home network which is already underway?" A: "Well it is certainly the most cost-effective one."

"Cost Effective" is a weasel phrase to mean "Cheap" and probably nasty. Turnbull is confusing and conflating terms, that somehow what seems like an accounting or business term is being applied to the NBN and a cheaper, inferior solution is preferable. There is no standard definition of "Cost Effective" - it translates to "If we feel like it". What's most effective depends on what expenses you include or exclude, the time-frame you use and whether you consider profitability/returns or only input costs.

I've also written at length about multiple other subterfuges, intentional and deliberate, going on with the Turnbull Node Plan. It can only 10% cheaper, the costs it saves the Government, and much more, are transferred onto customers (there really will be large setup costs for VDSL2 users), they cannot meet their promise of connection with "No Disruption", no DSL or telephone access charges have been published (but are used in their spreadsheets) and they are building their FTTN to throw away. In fact, they have put a number on their deliberate wastage: $2 billion dollars. For the 8.968M premises they'll "cover", they estimate $900 per service and "Capex Reused" will be 50% [bottom p14 Background doc]. Translated: "we'll throw away $450 per service on 9M services". Strangely, this is about how much less VDSL/FTTN is than Fibre.

What Turnbull never goes on to discuss is something most people, including the commentators, don't seem to have paused to consider: Will Fibre to Node be more profitable?

I expect most people reading/hearing "more Cost Effective" would take that to mean both "Cheaper" and "as profitable or more so". That's the massive con at the heart of the Turnbull Node Plan: "Sooner, Cheaper and More Affordable". They have never spoken about being Profitable or even paying for itself, let alone providing a Return.

Every single Business Plan, especially by big business, and that Turnbull would have written or assessed has four critical numbers, only one of which, Total Funding, appears in the Turnbull Node Plan.

• Total Funding,
• Project Lifetime,
• Return on Investment, and
• Years to break-even.

The only reason for a politician to withhold information, as has been done here by Turnbull, is to hide Bad News, to allow them to weasel out of things at a later time. The Coalition have been very careful to focus on the Cost side only, to emphasise delays and problems and to never, ever mention Revenue, Profitability and Asset Lifetime. 

"More Affordable" can only mean one thing: lower charges, which means lower Revenue. Turnbull et al have never discussed their anticipated Revenues, how long before they intend replacing their Fibre to the Node network, how Profitable it will be and if it can or will ever be able to pay for itself. The only commercial aspects they've discussed are "Sooner" and "Cheaper".

By the logic of Politics, anything that can be spun positively will be discussed. If the Coalition has never discussed Return on Investment, Profitability and Break-Even time, then they cannot be spun positively.

"Cost-Effective" is a weasel phrase used by Turnbull solely to mean "Cheaper" and to take attention away from their own modelling: the Turnbull Node Plan is a Financial Disaster. If it wasn't they'd be talking about Profitability as well.

It may be 10% Cheaper to build the Turnbull Node Plan, but they are building-in 5% wastage. It will cost many more times to run the the Nodes, they will make a lot less in Revenue, barely covering costs. Not only will the Turnbull Node Plan force $2-4 billion of new costs onto customers, it will be barely profitable, it will never pay for itself, can never provide a Return on Investment (versus 7% in the current plan) and while they say they intend to throw it away, provide absolutely no detail on that critically important stage of their Plan: who will pay and how much.

This is the Turnbull con, use "Cost-Effective" to mean lower Capital Cost, not the usual Business Planning test: leads to a more Profitable project and higher Return on Investment.

5. These are a series of statements that are content-free.

very high speed broadband up to 100Mbps.  So it is much faster than, the speed is much higher than people can actually make use of... [Relative comparisons, not precise or defined.]

But you can do that in a quarter of the time and a quarter of the cost. [Unsubstantiated claim: Their best effort is a 50% fudge on CapEx and a 75% on Total Funding. When using real figures, the Turnbull Node Plan cannot be more than 10% cheaper. A far cry from75% less.]

It isn’t very difficult to pull the fibre to the node, [most of the costs are in building 'the node' because it doesn't yet exist. Conveniently omitted.]

and it saves you all of the time and expense of digging up the streets and digging your way in and drilling you way into people’s houses, installing electronic equipment in peoples’ houses whether they want broadband or not. [This is pure FUD and spin.]

And so it does save an enormous amount of money. [Saving at most 10% of the budget and then throwing half that, wouldn't, in normal parlance, be considered "enormous".]

6. Here, two issues are conflated. First: Nobody but the Turnbull experts know anything, amazing when he also calls Labor "arrogant".

The second is simple, he's not comparing Apples and Apples. All the "authorities" Turnbull cities are incumbent Telcos who critically, like Telstra, own the copper. That's the enormous difference here in Australia: Telstra, the asset owner, is not building the network, that completely changes the economic. One of the largest single costs to, and creditor of, NBN Co is Telstra.

The answer to Turnbull's rather bizarre & irrelevant comparison is simple: Yes, they all know what they're doing with their own copper. That's NOT what we're dealing with in Australia, or did you not notice that "$50 billion" deal you wrote about in your Node Plan?

the people that we have been speaking with and learning from are not people who bob up on television and maybe have a lecturer at a university or something. They’re people who are actually building networks. You know, you’ve got to be pretty arrogant and Labor is of course, to think that that they know best and:

• Deutsche Telekom in Germany doesn’t know what they’re doing.
• British Telecom in Britain doesn’t know what they’re doing.
• AT&T in the United States doesn’t know what they’re doing

7. Here, Turnbull is setting up "strawman" arguments and presenting only a very small part of the picture. Who's going to pay? All the high-end consumers that are screaming for better speeds! 95% of traffic is generated by just half the customers. When did his worst-case scenario become the actual project cost? And if costs did start to spiral up, would NBN Co not address that? And then "many years" (relative term, meaningless). And "20 years" - why would that happen? The project is just 3 months behind now, but already Per User Revenues are 2 years ahead of projections.

Well, it’s very important to just explain the facts very clearly. I mean, it’s fine for people to say that they want fibre to the home, but the question is who is going to pay for it? Now if this is going to be a $94 billion project, and it’s going to take many, many years, maybe 20 years time, what do you say to the person who hasn’t had good broadband ever  ...

8. Costs. Massively underestimate his own Costs, massive and baseless exaggeration of current Costs, including never mentioning the latest real figures reported in April to Parliament. No mention of Revenue, Profit or Return on Investment: the critical factors in an investment.

So it’s not right to say it’s copper versus fibre. [Framing the question as something else] 

What we are saying is that you can save three quarters of the cost or three quarters of the time [as above, his plan is NOT for $10 billion or 2.5 years. This is pure fabrication.] 

 to get the job done by not digging up and replacing the last 4- or 500 metres of copper. [That Telstra, not NBN Co or the Coalition own, and will charge a lot for.] 

And that is because of the latest technology that is now available.... ["New Technology" must be good, eh?! Another meaningless, relative term. It's very expensive and a poor second to what really works.] 

But are we really so brilliant that we know something that the rest of the world doesn’t? [Yes. He's reframed the question as if we're in the same position as everyone else. It isn't Telstra doing the rollout on their own network. That's what's happening everywhere else he cites. The "$50 billion" given to Telstra completely changes the NBN project economics] 

I mean, are the Germans idiots?  Are the British idiots?  Are the Americans idiots?  Are the Belgians idiots?  Are the Austrians idiots? [Citing irrelevant Authorities. These are incumbent Telcos working with their own copper to maximise their returns on their asset.] 

Why are all these other countries taking the approach I am describing? [Because they're different!]

Q: "Malcolm Turnbull, just to recap on the cost under the Coalition plan, how much will it cost?"
A: "Well in terms of how much it will cost to complete the project, $29.5 billion for ours and $94 billion for Labor’s. [No, that's only a 1 in 100,000 worst-case scenario. Not a meaningful figure.]"

"In terms of what it will cost people, it will cost – our estimate is that the wholesale price, and of course this will feed into the retail price, will buy 2021 will for the average connection be $300 less." [All the Coalition "estimates" are unreliable and highly biased.