NBN maintains rollout forecast, shows increase in up-take rates

NBN Co's report to Budget Estimates on Thursday night shows that its revised forecast to pass between 190,000 and 220,000 premises with fibre by the end of June remains unchanged, but the take-up of NBN services is increasing.

NBN Co has twice revised its forecast for the number of premises it would pass with fibre by the end of June this year. In August 2012, it released a new corporate plan, reducing its 2010 estimate for the number of total premises passed, including wireless and satellite, from 1.2 million to 661,000.

Of this first forecast revision, the number of premises to be passed with fibre was 341,000 for June 2013. Of the 341,000 premises, 286,000 consisted of brownfields premises and 55,000 of greenfields premises. The revision was largely attributed to a delay in the AU$11 billion Telstra agreement for access to pits and ducts, and additional negotiations with the Australian Competition and Consumer Commission (ACCC) over the number of planned points of interconnect for the network.

In March this year, NBN Co again revised its forecast for the number of premises it would pass. The overall rollout was forecast to between 190,000 and 220,000. Of this revised range, between 155,000 and 175,000 are brownfields premises and between 35,000 and 45,000 are greenfields premises. This second delay was attributed to a difficulty in mobilising construction contractors in the field.

Shadow Communications Minister Malcolm Turnbull has stated that given the rate of revisions, it could take an excess of 20 years to actually complete the network. NBN Co CEO Mike Quigley has said that the delays can easily be made up for later this year.

No decrease in forecasts was seen in NBN Co's most recent report to Budget Estimates, indicating that the company may be on track as promised.

What has changed, however, is the number of users choosing to take up NBN services when fibre is deployed in their area. The average take-up of NBN services with fibre-serving access modules that have been active for more than six months is about 33 percent. However, more recent sites are showing averages that are much higher. NBN trial sites show an adoption rate of a little over 30 percent, but first release sites have an average take-up rate of about 45 percent. Volume rollout sites are shortly behind at a little less than 40 percent, but have only been available for roughly half the amount of time as the first release sites.

Some specific sites are showing significantly more take-up than others, such as Minnamura first release sites, which has a 64.4 percent take-up rate after being active for 100 weeks. Willunga, another first release site, shows a 63.4 percent take-up rate after 106 weeks.

Additional concerns about the possibility of delays during the presence of asbestos in pits and ducts were also addressed by Quigley, who said that processes and procedures to deal with abestos had been planned for from day one and these issues had been expected.

The responsibility for making these pits and ducts safe falls under Telstra's responsibilities, but NBN Co is conducting audits to double-check that remediation work is being conducted in line with respective regulations.