With more than 4.6 million premises activated and another 8.1 million ready to connect, NBN Co has only three million more premises to go to complete the rollout and says it is on schedule to achieve that by June next year.

December-half revenue rose 46 per cent, to $1.3 billion, from the same half last year and average revenue per user has edged up from $44 to $45. Chief executive Stephen Rue said NBN Co was on track to meet its projected $5 billion of revenue by 2021-22.

Rue was at pains to stress the relationship between NBN Co’s cash flows and its ability to deliver the community and economic benefits expected from the NBN, as well as to invest in and adapt the network as technology evolves. He was also keen to talk down the relationship between "average revenue per user’’ (ARPU) and wholesale prices.

The latter was clearly an NBN Co push-back against the lobbying by retailers, spearheaded by Telstra’s chief executive, Andy Penn, for a reduction in wholesale prices.

The retailers are screaming that there is no margin for them in reselling NBN capacity and have used NBN Co’s projection of an ARPU of $51 by 2022 to suggest they face rising wholesale costs.

NBN Co has previously reduced its wholesale prices while leaving its ARPU target untouched. As Rue said, ARPU and wholesale pricing aren’t the same thing.

The company expects to generate higher ARPU as business usage increases – it expects half the increase in ARPU by 2022 to come from business, which will generate about $1 billion of revenue by 2022 –but there is also an expectation that households will move up the speed tiers and there will be growth in data usage over time.

The emphasis on the need for NBN Co to generate cash flows could be interpreted as a reminder that there isn’t much flexibility in the company’s current financials, which are based on a finite amount of equity ($29.5 billion) and debt ($19.5 billion) to complete the $51 billion rollout and achieve a cashflow-positive position.

As discussed last week, that poses challenges for Labor if it wishes to change the nature of the multi-technology network and/or lower wholesale costs.

NBN Co’s December half accounts confirm that, after another loss of $2.2 billion in the half took accumulated losses to $19.44 billion, it has total equity of only $10.06 billion. It has also drawn down $9.2 billion of its $19.5 billion government-guaranteed debt facility.

As this is the peak year for the rollout, there is little flexibility to accommodate material changes to its mandate and economics.

Its position is made even more inflexible by the need to generate a positive internal rate of return (currently the target is 3.2 per cent) to keep the project - and its losses and debt - off-budget.

Retailers could do something about their margins by raising retail prices but, in the frenetic competition for customers as they are transferred onto the NBN, the retailers have competed their margins away and would presumably continue to do so at this point in the rollout even if NBN Co did lower wholesale costs further.

There’s little doubt that Labor, if it were to win the federal election, would be keen to add more fibre to the NBN, probably fibre-to-the-curb (FTTC).

At the moment, according to the NBN Co results presentation, the cost of installing fibre-to-the-curb is $3058 per premise. That may come down over time, but FTTC costs compare with the $2259 per premise cost of fibre-to-the-node.

Any significant increase in the proportion of FTTC, particularly if it involves replacing or stranding existing infrastructure, would almost certainly have a material impact on NBN Co’s economics, its ability to fund the increased capital expenditures and its ability to generate the positive returns required to keep the project off-budget.

As discussed last week, a major write-down of the equity in the project in order to lower wholesale costs isn’t feasible if NBN Co has an equity base substantially less than $10 billion.

Tipping in more equity to fund increased spending and, perhaps, reduced wholesale costs is only a partial solution, given that increasing the equity base would lower the rate of return because adding more fibre wouldn’t give NBN Co any increase in revenue. It would reduce its cash flows because it would increase its costs.

The reality Labor would face if it wins the election is that the rollout is nearing completion, with little wriggle room at either an operational or financial level to alter course so close to the finish line.

If Labor wants to materially change anything to do with the network at this late stage, whether it relates to technology or pricing, it’s going to be very difficult and extremely expensive even in the context of a build that has always been difficult and expensive.