Broadband FTTH Network for Australia
Harry Dutton
April 11th, 2009
About a week ago the Australian Government announced its intention to establish a ubiquitous Fibre-to-the-Home (FTTH) network to start “very soon”. The price tag is anybody’s guess but a guideline of USD$35 Billion (yes Billion) is a rough guide! The objective is for 51% Government (taxpayer) funding but may get to 100% depending on the enthusiasm of private industry.
As a telecommunications professional from Australia I keep being asked what it’s all about. My problem is that frankly, I don’t know. The announcement itself is more political than technical. Their business case is easy to summarise: “If we build it, they will come”. Not an encouraging start.
As it stands the telecom industry in Australia consists of “Telstra” (the privatised ex-government “PTT”) with about 80% of the market, Optus (a full-service carrier with between 10% and 15% of the market) and 250 or so niche players. Telstra owns and controls almost 100% of the “access network” - telephone copper wires connecting most homes. Both Telstra and Optus have suburban fibre trunk networks, suburban TV Cable (HFC) networks and large interstate trunk networks.
The government has been trying for some time to get “equality of access” to the “access network” for all
telco players but it feels that Telstra is reluctant to give up its monopoly position. Within this context there have been a number of attempts to get a ubiquitous “broadband access scheme” going - the most recent being a VDSL access proposal; but they have all foundered on the question of who should own and control it.
The current announcement is for a totally new “network”, which will be sold “wholesale” to carriers who will then provide the customer services. The big questions are about the scope of the network and how it will be shared by multiple carriers. If one of the current “PON” (Passive Optical Network) architectures is adopted, then how is the network to be shared so that any user can choose whichever telco they want to do business with? The obvious way would be for the new network provider to own a very large number of large IP routers - in which case what real value would another telco have to add? Billing perhaps?
The proposed change could be radical and deep. It could mean the end of “vertical integration” in the telecoms industry. But we haven’t been told anything about the technology or functional extent of the network. Of course, it is entirely possible that the announcement is only a “big stick” intended to “encourage” Telstra to come to the barganing table - if it is, then that will be a pity.
FTTH is a great idea and we will probably need the capacity sometime in the future - but it is not needed yet! So why spend the money? On the other hand the majority of the network cost is the highly labour-intensive activity of “digging up the roads” to reticulate fibre to every home. At a time of mass unemployment this seems a sensible way for government to provide economic stimulus and invest for the future.
Personally, I hope the network goes ahead. I would hope that it will be the owner and operator of fibres and little else. I would hope that it will “rent” or “lease” fibre strands (and space in equipment housings) to anyone on the same terms and at the same price as to anyone else. I suppose however, it is a faint hope.
Tags: Broadband Access, HFC, optical fibre access, PON