NBN Co cuts top forecast
Expected maximum rollout cost sliced from $56b to $51b
THE company rolling out the national broadband network has cut the top end of its forecast range for the project’s cost.
NBN Co says it still expects to complete the rollout for $49 billion or less, but the potential range has now been narrowed.
It was previously expecting the project to cost between $46 billion and $56 billion. That range has now been tapered to $47 billion to $51 billion.
Releasing its corporate plan for 2018 to 2021 yesterday, NBN Co stuck to its guns with regards to the sum it hopes to recoup from the network. It is forecasting total revenue of $5.4 billion within a year of the network being fully rolled out across Australia.
The other main financial metrics for the network also remain largely intact in the plan, which for the first time reveals NBN Co’s operational expectations a year after it is built.
NBN Co is expected to become cashflow positive in the year to June 2021, generating close to $100 million.
The average revenue from each user is forecast at $52 a month.
NBN Co chief Bill Morrow said the entire country will be connected by 2020.
“Since our 2016 corporate plan we have reduced our peak funding expectations from a $10 billion range, to a $4 billion range today,” he said.
“This is a financially viable model … it will generate enough margin, although it will be modest.”
The expected number of homes and businesses with an active NBN service in 2020 remains at 8.1 million. However there has been a slight revision of the overall footprint.
NBN Co had made “slight changes” to its forecast footprint for this financial year, he said, “with 200,000 fewer premises expected to exist, and around 200,000 premises shifted into (the following financial year) to receive our network upgrade to fibreto-the-curb technology”.