NBN Co should own copper, HFC networks: Switkowski

NBN Co should own copper, HFC networks: Switkowski

Summary: The goal of renegotiations with Telstra should see NBN Co own the legacy copper and cable networks, NBN Co chairman Dr Ziggy Switkowski has said.

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NBN Co should own Telstra's copper and hybrid fibre-coaxial (HFC) networks by the end of renegotiations with the telecommunications giant, according to NBN Co chairman Dr Ziggy Switkowski.

nbn-co-should-own-copper-hfc-networks-switkowski
(Image: Screenshot by Josh Taylor/ZDNet)

NBN Co is currently a few weeks into renegotiations with Telstra over its AU$11 billion deal with the former government and NBN Co.

If NBN Co is to pursue its proposed multi-technology mix model that sees large parts of the fibre-to-the-premises rollout replaced with fibre-to-the-node, fibre-to-the-building, and HFC, the company will need to at least gain access to Telstra's legacy networks.

In an interview on ABC's The Business last night, Switkowski said negotiations should result in NBN Co taking ownership of the networks from Telstra.

"I think the outcome of these negotiations should lead to a situation where the copper network, the ownership, is transferred into the NBN; the ownership of the HFC network is transferred into NBN," he said.

"And then we get to invest in it, provide in-fill where needed, upgrade progressively over time so that as consumer needs for ever-higher bandwidth, which we know are going to grow spectacularly, can be met by our use of those networks."

He said that this would mean that NBN Co would take on the responsibility for maintenance of the copper network which a leaked analysis of the Coalition's policy by NBN Co prior to the election estimated that maintenance costs for fibre to the node with the copper network included would be between four to six times that of the fibre to the premises model.

Switkowski said the outcome of the renegotiations should see neither Telstra or the taxpayer out of pocket.

"At the end of it all Telstra shouldn't be out of pocket relative to what they had agreed to before, and the taxpayer shouldn't be exposed to higher costs, unless they're getting more services," he said.

Switkowski downplayed previous comments made by Communications Minister Malcolm Turnbull to Fairfax Media that the deal would likely be wrapped up by June, stating it was too early to say when negotiations would be completed.

"I don't want to raise unreasonable expectations because the negotiations are about big issues, and we're only part way into them," he said.

"We have all of this year which all of the former model has been queued, and then next year we'll start working on the multi-technology alternatives."

Switkowski again took aim at TPG's decision to roll out fibre to the building for 500,000 premises across Australian metropolitan locations, saying NBN Co will have "a commercial response" and the company had no intention of being the provider of last resort in places where the economics of building alternative networks did not work.

"For this to work, NBN has got to be a monopoly provider and will wholesale to all of the retail service providers including TPG," he said.

"Alternatively we'll end up with an industry where we have pockets of other infrastructure provided that may or may not be able to be wholesale. Competition may be chilled."

He said NBN Co would be around for a long time, and would be the reliable fixed-line broadband infrastructure provider in Australia.

"We will be responsible for providing high quality, upgradable bandwidth, connectivity. I'm not sure we can be as confident about anybody else."

Topics: NBN, Government, Government AU

About

Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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14 comments
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  • nbn ownership

    The NBN should own all the physical telecommunications networks so the country has one unified telecommunications and broadband network. That forever stays in the country's hands and never in private company hands again.
    apwaddington
    • re

      Ideally, yes but unfortunately the Noalition has already started to get EoI for NBNCo's assets.
      Zhyr
    • Depends on how much you trust the politicians

      Cash cows are highly addictive in the public and private sectors alike; but they tend not to be maintained long term. And the only read advantage governmental monopolies have over private sector ones is that the general public gets to elect the people in charge; but how likely do you think it is that network maintenance is to be a big election issue, as long as the network isn't obviously falling apart?

      Competitive markets are usually better if you can get one; and I don't see any obvious reasons why Internet service can't be a competitive business if the rules are written right.
      John L. Ries
  • Finally something sensible from Ziggy!

    Actually, two things!

    "For this to work, NBN has got to be a monopoly provider"

    and

    "I think the outcome of these negotiations should lead to a situation where the copper network, the ownership, is transferred into the NBN; the ownership of the HFC network is transferred into NBN,".

    Now, they just need to see the sense in sticking to fibre all the way (except in areas where installing it would be expensive/difficult, like in MDU's with body corps that wont/cant allow fibre to be run...older buildings, that kind of thing) and I'd get right behind them...
    Tinman_au
    • One man's sensible is another man's senseless!

      Why would we i.e. the taxpayer want to own these dilapidated, un-maintained obsolete networks! You're suggesting that we should buy these lemons and then still install http when what we should be doing is installing http and ignoring these useless networks! Especially since the cost of buying them ($11 billion dollars) appears to be about the difference between the cost of this new dogs breakfast CBN (Coalition Broadband Network) and the cost of the original NBN a state of the art world class Broadband Network.
      Bog_Frog
      • We want the pits 'n' pipes

        You forget mate that we'd be buying all the ducts, pits, pipes and other infrastructure from Telstra - which would allow us to upgrade/decommission/access when we want, how we want without having to go through the circus of Telstra approval.

        This would make 3 in a row for Ziggy when you include "TPG's rollout will hurt NBN Co financially".

        i wonder if he's started eating breakfast in the morning?
        The Guv
        • Headless

          I doubt Ziggy has the ability to find his own head these days, which makes the eating of breakfast problematic!

          Yes, I agree the underlying infrastructure although also poorly maintained has some underlying worth(though far from $11000000000 I would guess) but the Zigster is proposing using the crappy almost totally defunct copper which is virtually worthless. We should be reacquiring the infrastructure ripping out the copper and putting in a proper ftth solution. (The infrastructure shouldn't have been sold off in the first place, Telstra must be laughing hard at buying something on the cheap, running it down to near worthlessness and then selling it back at premium prices)
          Bog_Frog
          • +1

            +1
            Zhyr
          • No argument here

            Agreed. And I think we all agree that this whole process stinks to high heaven and I'm sure there'll be a day when all the dodgy deals come to light.

            However much labor buggered up the planning, it was always an ambitious project that required a lot of up-front, on-the-job learning, but it had solid ideals; a monopoly that would generate income and provide the same service for (most) all people, fibre for open-ended speed upgrades, fibre for massive maintenance savings, and complete ownership of the infrastructure so Telstra wouldn't remain the uncompetitive beast it is today.

            Having just typed that, it makes me angrier that Ziggy is coming out with this stuff now!
            The Guv
          • +1+1+1+1+1+

            Yep yep "(The infrastructure shouldn't have been sold off in the first place, Telstra must be laughing hard at buying something on the cheap, running it down to near worthlessness and then selling it back at premium prices)"

            OH THE IRONY of having to buy back your own infrastructure.

            Can we renegotiate a deal where we just get the pits and pipes? Telstra can keep the copper for recycling or whatever. Stick fibre in those damn ducts.
            Ramrunner-5dd3e
      • and yes I know the two http's were supposed to be fttp's :)

        see correction in title
        Bog_Frog
    • If NBNco get control (at great expense) of the copper and HFC, that'll be the end of FTTP for most of the planned FTTP area. There'll be so much money wasted acquiring and maintaining those corroded and clapped-out 'assets' that they'll be there for a very long time.
      anonymousI
  • In other Words...

    Ziggy States:
    "upgrade progressively over time so that as consumer needs for ever-higher bandwidth, which we know are going to grow spectacularly"

    Meaning: we'll commence ripping those 60,000+ then useless nodes back out possibly even before 2020 & start replacing the copper with the fibre portions Turnbull has cancelled in order to catch up with that demand & the rest of the planet.
    Meanwhile we twiddle our thumbs as Turnbull invests his own cash in overseas FTTH rollouts while wasting ours for another year or two on endless Reports, Reviews & Negotiations attempting to convince the gullible his sow's ear is actually a silk purse.

    That "Cheaper & Faster" is looking very much like 'Slower & Dearer' for us consumers but at least Rupert's Foxtel will remain super profitable screening "I Love Lucy re-runs" for a great deal longer while the rest of the world adopts 4K streaming media & TV on demand.
    grump-a1eeb
  • Blame J. Howard

    Howard did the mad midnight fire sale of Telstra buy now pay nothing for 60 months. Instead of splitting Telstra in 2 like they should have done. Keep all networking in Gov't hands and sell of the Retail side of Telstra.
    This way we would have had FTTP years ago as the $11 billion paid to Telstra would have built the entire FTTP program. Guess it will never happen as the separation of Telstra was meant to happen years ago and today 2014 they are still talking about the separation of Telstra.

    What Ziggy is saying is "lets built FTTP after we waste billions on his failed FTTN" again Ziggy has no idea as he was a failure at Telstra and again in the NBN Co role. Ziggy should be handing back his $50 000 a week job and going to the Police and turning himself in for fraud, as he has pulled the covers over everyone's eyes.
    Now this new CEO is employing his old cronies from Vodafone, what a joke if they were serious about any form of NBN they would be knocking on the doors of people that know networking and employing people from Cisco and the likes.
    Mudrat70