NBN Co execs face grilling over Melton fibre trial 'conspiracy'

NBN Co CEO Bill Morrow has said the company initially denied the existence of the Melton trial because senior executives had not been aware of the initial trials that had not been verified by the management.

Earlier this month, NBN Co initially claimed that a report of an internal presentation of a trial of cost- and time-saving methods used in the Victorian suburb of Melton — that saw the rollout completed in 104 days, with more than 90 percent of premises serviceable at 61 percent faster and 50 percent cheaper than previous rollouts — was inaccurate.

NBN Co didn't deny that cost-saving measures had been employed in the Melton trial, but said that such techniques are already being used by NBN Co elsewhere as part of an overall company-wide program to lower the cost of the rollout in a time when the company has been directed by the Coalition government to consider technologies other than fibre, including fibre to the node and hybrid fibre-coaxial (HFC), if those technologies are cheaper than installing fibre to the premises.

Today Morrow said there was no "conspiracy" to bury the documents.

"There is no conspiracy to hide information and we remain technology agnostic. We would be happy to build a new network rather than remodel an old one but the fact remains that, even with the planned efficiencies, FttP costs more and takes longer to build than what is expected of us," he said.

"If we were to find a breakthrough that changes this, there would be nothing stopping us from putting more fibre in the ground and that is exactly what we would do."

Morrow said that some of the documents that bears NBN Co's letterhead were not verified, and the executive team had not seen them prior to being alerted to them by media.

He denied claims by former communications minister Stephen Conroy that NBN Co media had lied about the existence of the documents, stating that the company had initially acted in haste in responding to media requests about the documents. They had consulted the executives who were unaware of the documents, and then after further investigations discovered the trial had been conducted, but the cost- and time-savings had not been reviewed and officially signed off by the company.

"It appeared this was a document someone else had doctored. Further information was then revealed over time that there was in fact a project looking at the reduction of costs," he said.

He said that a "peer review" inside NBN Co was now taking place, and the company would determine whether the savings in the Melton trial are real, and can be applied across the entire fibre to the premises rollout.

"There's no denial that we endorse these kinds of projects. It may very well be factual, but we have not validated it," he said.

"We want to find genuine savings, and genuine improvements and run with them."

NBN Co's chief operations officer Greg Adcock said that the savings, and the so-called Architecture 2.1 that had also been outlined, using fewer fibres per premises had not been proven yet.

"It was a desktop exercise based on somewhere between 2 and 4 FSAMs [Fibre Service Area Modules] and then extrapolated over 4,000 FSAMs to calculate the number," he said.

"I believe at the time I asked the lead engineering representative if this is the way he would normally make changes to the deployment rules, to which I was told no.

"If there were savings that had been validated ... then we should do them ... if not we should go back and do more trials."

Morrow said NBN Co could not spend its time responding to every leaked document, suggesting that many of the leaks were from ex-employees and could be doctored.

"There's lots of fibre to the premises zealots out there, and lots of disgruntled ex-employees," he said.

Morrow today revealed construction had commenced on a 1,000-node trial of fibre to the node in Queensland and New South Wales, with the aim to have 1,000 nodes up and running by June 2015.

He also indicated NBN Co would soon go to tender for a trial of using the HFC cables owned by Telstra and Optus in the NBN, but said this trial would be considerably different given the HFC cables were already deployed by the two companies.

"When it comes to HFC, we have test equipment in our labs and we've begun the tender process to select our supplier. As you know, this technology is widely deployed in the country today so the trials will be of a different nature than that of FttN," he said.

"Much of this activity will help ensure we hit the ground running when the commercial, regulatory, product and other elements for FttN and HFC are in place."