(Edited to correct the prose...)
Because it is the cheapest and quickest build which also achieve a modest ROIC (return on invested capital)
Rudd's megalomania thought bubble started it all off
Swan wanted to show Labor could get a budget surplus as well. If Costello could he could too. Worlds best Treasurer surely had to get a budget surplus...somehow. So the trio Rudd/Swan/Conroy took it off the books so that it would not affect the budget position. Never mind that with both the capital had to be borrowed as Rudd had blown the zero net Govt debt on the cash splash
The megalomania continued when everyone told Rudd it could not be done at the price and in that time frame of $43 bill and 8 years. Rudd knew better than any expert and when no private partners put their hand up, he went it alone.
NBN starts with building fibre in Labor and marginal electorates. -pork barrelling. No surprises here either.
Then they said NBN has "passed" thousands of homes when in fact it was still in the planning stages.
Then Turnbull thinks he can build cheaper and faster because he is a banker and is smarter than everyone else - megalomania. But there was a poison pill from Rudd/Swan/Conroy - that the mandated ROIC was unachievable at the cost time and price point that people was willing to pay.
But Turnbull is very smart - Kerry Packers barrister and Ozemail - high IQ presumably. So he makes it work by using MTM - copper and HFC in many places bringing the cost way lower and quicker, so the ROIC is now achievable - on paper.
Dont forget the now Liberal Govt had to deliver on their "superior economic managers" mantra because they were Liberals and because they kept hammering Swan about it. Hockey and ScoMo were therefore also desperate to also keep the project off the books. Do anything to make the ROIC work. So they brought in Morrow from Vodafail to make the numbers work and in the meantime bury the project and the Senates estimates committee in gobbledegook.
The numerator on ROIC equation is net income. When it comes to internet people do not like spending more than $70-$80 /month. And this was a government project, so like all government projects it should be cheap or free to the consumer (in their eyes). The expectations were then set. Fast Cheap and I want it Now!. The NBN net income had to account for this fact. Doesn't matter how rolled gold you make it people wont pay for it or they will make a big song and dance about it that politically it was not a good idea.
So why copper?. 2 reasons:
1)Politicians promised a Rolls Royce and delivered a Corolla which is what you always get when politicians dream up a project.
2)Consumers wanted fast and cheap internet now and they did not want to pay more than what they were paying now. They wanted a Rolls Royce for the price of a Corolla. Who wouldn’t. Even now when some could get an Audi by paying more but they still refused and only paid a Corolla price. If the Government is paying for it why should they?
However the poison pill is still there.....