Optus looks to fill the Coalition's NBN gap

Optus looks to fill the Coalition's NBN gap

Summary: As the Coalition seems set on changing the NBN to fibre to the node, Optus has said it is open to a variety of options to connect customers from the node to the premises.

TOPICS: Telcos, Optus, Telstra, NBN

As the Coalition begins to scope changing the National Broadband Network (NBN) from a majority fibre-to-the-premises (FttP) design to majority fibre the node (FttN), Optus has said that it is open to alternatives to using Telstra's existing copper line to connect their customers from the node to the premises.

Coalition communications spokesperson Malcolm Turnbull this week reaffirmed the Coalition's plans to conduct an audit of NBN Co and complete a cost-benefit analysis to determine the best way forward, which will likely lead to following the Coalition's policy for an FttN NBN for 71 percent of Australian premises.

Before that work can be started, the Coalition will need to renegotiate with Telstra to access the last section of copper from the node to each premises to connect to the NBN. But Telstra's biggest rival, Optus, which has criticised the level of payments that Telstra is receiving as part of the NBN project, is looking at potential alternatives.

The Australian reported last week that Optus would look to pay for the fibre from the node to the premises for customers signing on to two-year contracts. While Optus' vice president of regulatory affairs David Epstein would not confirm the story, he indicated that the space for telcos to pick up NBN services from the node would not be limited to just fibre, and could potentially incorporate other technologies, including mobile services such as long-term evolution 4G.

"There is folly in being purely technology channel driven when you're debating telecommunications. The real debate should be what is the actual outcome of the system. What is the outcome for the customer regardless of the technology," he said.

"I think there will be room for all sorts of opportunities under how the Coalition has sketched out its vision for the NBN. In some areas, it will make sense to continue to have [FttN] or there may be room for resellers of the NBN or private providers to fill the gap between nodes and premises by varying ways."

The NBN should now be seen as a "network of networks", Epstein said, removing the focus solely from being a single network to one that is made up of different technologies that best suit the location or premises.

"To date, the debate has focused on the high end fibre element of the NBN. The NBN has always been a multi platform network in that there is fibre, there's satellite, there's fixed wireless. The additional element is that it may well incorporate other architectures and other sub networks," he said.

"I suppose what we've all got to see is what is the shape of that. That determines our product offering, and that will determine to some degree our future regulatory agenda."

Epstein said that the change of government had long been expected, and that Optus' relationship with Turnbull had been very good during the years he was in opposition.

"We don't anticipate any radical changes of direction or surprises. We've enjoyed a very good relationship with Malcolm Turnbull and his office to date. They've been very consultative in opposition, and the initial trends are that they are continuing that in the transition to government," he said.

He said that the new Coalition government could now move to focus on the regulatory environment, which had been sidelined by the debate between Labor and the Coalition over the NBN.

"We do think there needs to be a more sophisticated debate around the impacts on industry cashflows of NBN infrastructure spending and on the industry cost base," he said. "And we do think there needs to be a renewed vigour in the debate around wider industry competition and access issues."

Optus, along with other industry competitors such as iiNet, have lobbied the Australian Competition and Consumer Commission (ACCC) in the last month to look at enforcing better regulation of access to Telstra's duct infrastructure, for which the telcos have argued Telstra charges much more to access than it costs to maintain the ducts.

Access to the ducts will not only be required for existing networks, but will often be needed under the NBN, with NBN Co leasing access to Telstra's ducts as part of its deal. Telstra has argued that regulation should remain as is, and that issues over access to ducts were resolved several years ago.

Topics: Telcos, Optus, Telstra, NBN


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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  • Subsidised installation

    While I'm an advocate of FTTP, I've always thought that IF we were to get FTTN, installation of fibre to the premises should be an option charged to the RSP, who can then choose if/how to pass costs onto the customer.

    This option should be averaged and possibly subsidised, so for the first installation in the street, NBN Co might lose a bit of money, but as the fibre has been laid, the second installation should be cheaper, etc. For example, charge an average of $2000. The first installation might actually cost $5000 and subsequent installations in the street might cost $1500.

    The RSP is charged (e.g. the $2000) and can then have the customer sign a 24-month contract and pay off a subsidised installation fee over the 24 months.
    • Already in the policy

      I suggest you read the coalition's policy as this is already in there under co-funded fibre. I'd say this is in there to stop another provider just bypassing the FTTN network but making it uneconomic when they can get a subsidy.

      The issue I see is, if enough RSPs or others take up the option of co-funding of FTTP, then the deployment of the actual DSL nodes would be under-utilised, whilst forking out a subsidy for FTTP.

      Also how can costs be controlled when you are basically offering a limitless subsidy?
      • Co-funded is different to FoD

        Have another read of the policy, Co-funded is meant for areas, not individual premises, so you'd be looking at councils and developers co-funding. Optus is talking about picking up the tab for FoD as long as you lock in to a contract for a long enough period.

        It's possible they may look at particular areas and if they have enough interest, they may be able to leverage off the "co-funding" section of policy, but that will mean full fibre could be pretty hit and miss.

        Kudos to Optus for at least taking a look at this.
        • "Kudos to Optus for at least taking a look at this."

          Indeed it also seems Optus already know their customers won't be satisfied with a piddling 25mbps.

          I also wonder if those who complained about that "bu bu bu taxpayer funded NBN waste elephant" will realise Optus will be basically doing the same thing as NBNco to pay for fibre in this scenario...

          1201 days to go!
          Hubert Cumberdale
      • I KNOW!

        Build FttP in the first place. Subsidy problem and under utilised nodes sorted.
  • Great

    So now we end up with a mish-mash of technologies, all connecting back to street level nodes. As opposed the the completely node-free model we started with. Ugly, waste of power, waste of money, waste of effort.
    • mish-mash

      Indeed, much like during the 90's...
    • "Ugly, waste of power, waste of money, waste of effort."

      yep, and if Optus have any success with this it'll further highlight that fact.
      Hubert Cumberdale
  • No longer about consumers

    It is all about profits for the Telcos' now.
  • not free

    The FTTP was never free.. It was 40+ billion dollars.

    The irony is that if the NBN co hadn't constantly lowered its connections projections. Loads and loads more people would be on ftth now. But 10 years from now we'll all be using LTE5 anyway.. So who will care about the fibre then other than business? (Who can get it now regardless of which government)

    I want fast home internet now.. Not in 5 years when the nbn co finally get here. In five years I expect that the question will be becoming redundant.
    • Quicker, how so?

      Do you really think a company is going to just drop nodes in tomorrow and connect you?
      Negotiations with Telstra / ACCC, coming up with a solution, putting it out to tender, testing it and the build in different environments, all before they can build a single node.

      I really don't understand how FTTN can be deployed much quicker than the current roll-out.
    • You might...

      "But 10 years from now we'll all be using LTE5 anyway."

      Unless they come up with some sort of magic, the latency of wireless is a deal breaker for me...
    • Wireless: limited electromagnetic spectrum

      Wireless (eg. LTE5) will never replace physical connections like fiber optic.

      Ever been to a concert or event where there are many people in a small area and despite having full bars of mobile phone reception you are unable to connect to make a call?
      This is an example of one of the limitations of wireless, the website has an article explaining the technology and physics behind why wireless would not work.

      Michael Rogers
  • aaah back to the magic wireless fairy

    LTE5 or any other wireless technology will never ever replace having a physical medium to transmit over. Even the coalition worked that out 2nd election around.
    The issue is to even closely replicate broadband now, we'd need so many towers and with NIMBY-ism it will never happen let alone work that well. Yes people will be mobile more, and that will run off the NBN backbone, which is what has been mostly built.
    Justin Watson
    • ERM


      However quantum entanglement will most likely be the endgame in connectivity. Wireless and INSTANT transfer over any distance. ANY distance.

      Pity we don't know yet if they can actually even send data over these links yet.
      • True

        Interesting area, explains why SETI misfired.
        However many cautions - the foundations of matter/energy - resonance is a factor.
        See - Chi, Qi, Prana etc.
        I know China was working with Grand Masters decades ago , some of who'm are in their science community and academy of science. They proved Chi has an infinite bandwidth and velocity of propagation.
        Dangerous area
        Abel Adamski
  • Lockin again

    So instead of being able to choose from multiple RSP's on FTTP, I will only have a small choice on FTTN if I want fibre. Probably only the two majors who would be able to bank roll it. I can see high prices like Telstra's velocity if you want fibre. Sucks
    • Spot on

      Remember this a Liberal plan. Always designed to screw the public for maximum profit, after all to them profit is GOD Almighty, it is in their DNA
      Abel Adamski
  • 'Node fibre' is NOT equivalent to GPON fibre

    And, of course, even if Optus do offer you a fibre connection, it will be severely limited by the nature and technology of the node electronics. What many people fail to realise is that GPN fibre to your premises does NOT equal FTTN 'node fibre' to your premises. For example, in the UK, node fibre is limited to 330Mb/s. GPON currently supports 1Gb/s. Before anyone now starts sounding off about 'who needs it', I'm merely pointing out that the GPON fibre essentially gives you unlimited bandwidth over its lifetime, while 'node fibre' hits a hard stop fairly quickly. And who really knows what we will require in 10 or 20 years time?
    • Plus

      FOD from the active card is less reliable as active electronics in a highly variable environment as against a PASSIVE Optical splitter without electronics in the field for FTTP
      Abel Adamski