NBN Co waiting on apartment cable contracts

The government-owned company tasked with rolling out Australia's National Broadband Network (NBN) has revealed that it has yet to sign any contractors on to install fibre in one third of the existing premises covered by the rollout.

In May 2011, NBN Co put out a request for proposals to the construction industry, seeking to install fibre cables into so-called multi-dwelling units (MDUs), such as townhouses and apartment blocks. MDUs offer quite a different challenge for installing fibre services, as each MDU is different, and can require substantial refits in order to replace existing copper infrastructure with fibre.

Speaking before the joint parliamentary committee investigating the NBN rollout, NBN Co's chief operating officer Ralph Steffens said that the contract has yet to be finalised, close to 18 months after going to market.

"We have separate contracts for [MDUs], but we are talking to one of them who is about to start to build the first ones," he said. "We are in trials with a number of contractors. We are about to award the contracts for the MDUs."

NBN Co has yet to develop a methodology for connecting MDUs, because each one is so different. NBN Co CEO Mike Quigley said that the average number of units in an MDU is nine, but this is widely varied. Steffens said that there is no single solution for installing fibre into units.

"There is no right answer to this; every MDU looks different. There is not one method of connecting MDUs," he said. "Connection methodologies evolve rapidly. What we do today will evolve over time. "

Steffens said broadly that NBN Co is now in the stage of a ramp up, and is on task to have passed 286,000 premises by the end of the June next year, as per the corporate plan.

There has been controversy in recent weeks over the backlog of new housing estates that have yet to be passed by NBN Co fibre, despite the number of applications. It was recently revealed that NBN Co had a backlog of 3,800 new premises that have customers waiting for an NBN connection. NBN Co said last night that it has employed additional construction companies to get onto this backlog, and that the figure is now down to 3,200.

However, applications from developers are still piling in. In the first quarter of this financial year, Quigley said that the company received 322 applications covering 150,000 lots. Although NBN Co was the fibre provider of last resort for over 100 lots, he said that the average number of premises being passed in these sites is 51.

"There's no way we can police this. We have to do it, which is what we're doing," he said.