Monthly Archives: October 2017
The Department of Communications estimates the value of the NBN based on the depreciated current replacement cost less the present value of leave and superannuation. It should now turn to using net present value of discounted future cash flows; as it does now for Australia Post. In doing that, it should not assume that average revenue per users will rise at the rate needed to recover costs but assume levels that reflect the market (especially competition from wireless broadband). It is likely that the fair value revealed by this DCF estimation will then lead to a write down in equity.
Previous columns have been about the structure of NBN prices. This is about the current and future level of NBN prices. See Economuse 2017-10-10
This is the refereed paper that appears in the September 2017 issue of the Australian Journal of Telecommunications and the Digital Economy Safetynet AJTDE