Telstra rushes HFC network expansion ahead of NBN migration

Australia's largest telecommunications company is continuing to build out its hybrid fibre-coaxial (HFC) network out to new premises, despite an agreement to transfer ownership of the network to NBN.

As part of the revised agreement between NBN and Telstra, the legacy HFC network and its customers will be progressively migrated over to the National Broadband Network, commencing with a pilot later this year before a full rollout beginning in 2016.

In spite of the planned HFC sell-off, Telstra has continued to expand its HFC footprint, and has gained more customers that will be transferred onto the NBN.

In a document commissioned by local buildings in the area, and obtained by ZDNet, Telstra is proposing to expand out its HFC network in Breakfast Point, Sydney, by up to 1,076 premises by September 2015.

Telstra has agreed to subsidise the cost, and is advising strata and building managers in the area that the cost will be AU$100 per premises. The proposal to expand in Breakfast Point will only proceed with 70 percent of the stratas in the area that accept the offer from Telstra.

The offer document from a third-party telecommunications consultant firm, TeleResult, downplays the NBN rollout in Breakfast Point, noting that it is only new greenfields sites being connected so far.

"There is currently no detail from NBN on any extension of the NBN to 'brownfield' (ie, developments already in place) sites in the Breakfast Point Precinct."

HFC, the company said, would offer 100Mbps download speeds, and more once taken over by NBN and upgraded to DOCSIS3.1.

Telstra would be the initial retail broadband provider in such an agreement, but TeleResult stated that once the asset is handed over to NBN, customers will be able to choose their internet service provider (ISP).

However, the document infers that NBN has told Telstra there will be a "five- or six-year plan for the migration and integration of HFC networks", meaning that customers may not be moved to the NBN until 2021.

NBN has not yet put a timetable on the HFC deployment, but the entire network is scheduled to be deployed by 2019.

A spokesperson for NBN said that the company's timetable had not changed.

"By 2020, we aim to have all homes, businesses and communities able to access high speed broadband, with 8 million premises connected," the spokesperson said.

"Indeed, we're doing detailed planning work on HFC and expect to add the first HFC premises to the rollout plan over the coming months."

Telstra was also quoted in the document as stating that "reliance upon NBN to deliver a service with performance greater than fibre to the basement (max speeds of 50Mbps) for residents in Breakfast Point would be in vain", and recommending that HFC would be "future proofing the services and offerings available to residents" ahead of the network being taken over by NBN.

A spokesperson for Telstra told ZDNet that the company is mainly focused on connecting multi-dwelling units to the HFC network as requested.

"As we have done for many years, we add multi-dwelling units to our HFC network where they are either inside or adjacent to our existing footprint. This tends to be where body corporate managers want their residents to have access to HFC services as well as greenfield sites," the spokesperson said.

"We will continue to look at opportunities to offer HFC in these buildings where our network footprint provides for it, and if it makes commercial sense to do so."

Telstra's competitors have been concerned that the company may seek to lock up NBN customers through expanding the HFC network prior to its integration into the NBN, but were more concerned about NBN Co undertaking construction work before the network handover.

The expansion of Telstra's HFC network is not believed to be in breach of the anti-cherry picking legislation passed by the former Labor government, because Telstra is not connecting customers 1 kilometre outside of the current HFC footprint.