Australia’s NBN Co may take up to 30 years to make a profit

Australia's state-owned National Broadband Network Company (NBN Co) said yesterday that the government will no be able to generate a return from its prestigious multi-billion dollar national broadband network for 20 to 30 years.

Appearing before the Senate Select Committee, NBN Co chief executive Mike Quigley said, "The board's role is to get a satisfactory long-term return on the capital the government invests. Now it's up to the government to determine what that return rate is, but we would hope to generate a return.''

"This is a long-term project, so for this type of nation-building infrastructure I'd imagine you'd be looking at a 20 to 30 year timeframe," Quigley said.

The Australian government embarked on the A$43 billion($40 billion) NBN project, the single largest infrastructure project in the nation's history, by establishing the NBN Co exactly a year ago to design, build and operate the next generation, wholesale-only national broadband network.

NBN is expected to provide the infrastructure to deliver advanced digital services with speeds of 100 megabits per second to 90 per cent of the country's premises and 12 megabits per second to 10 per cent, using fibre-to-the-premise (FTTP), wireless or satellite networks depending on location and geography.

So far, the company has received A$212 million in equity funding from the government for the ambitious project, from the A$4.7 billion allocated in last April.