Bodies corporate will only be able to sign up to one fibre-to-the-building (FTTB) provider because the technical limitations of VDSL2 and VDSL vectoring technologies preclude NBN Co from installing DSL-based services in buildings where TPG Telecom had already installed FTTB, NBN Co CEO Bill Morrow has confirmed.
Testifying before the Senate Select Committee on the NBN this week, Morrow – supported on technical details by outgoing NBN Co chief technology officer Greg McLaren – said the company would be forced to roll out fibre-to-the-premises (FTTP) services directly to multi dwelling units (MDUs) to bypass FTTB equipment that TPG had already installed.
This was necessary because installing FTTB equipment from two different providers was “well known” to cause interference problems, McLaren said.
"It's well known with DSL systems that if you have [two services] running over the same copper binder, the same copper cabling, that there is interference between them," McLaren said. “That happens today in ADSL networks.”
Senator Stephen Conroy asked whether VDSL2 vectoring technology – crucial to delivering high speeds under the government's multi-technology mix (MTM) alternative NBN strategy – would improve the situation.
"Vectoring solves that problem when it's coming from one DSLAM,” McLaren responded, “but when it's coming from independent DSLAMs then the advantage of cancelling out the interference disappears. It becomes a situation where it's more like a non-vectored service."
While the Communications Alliance had conducted “quite a bit of work” on the problem – and had provided a working paper on the issue to the NBN cost-benefit analysis headed by Dr Michael Vertigan – McLaren conceded that he was "not aware of" any company, anywhere in the world, that had found a solution to the problems posed by having two independent DSL services on the same copper.
Technical reality meant that NBN Co would have to resort to using FTTP in MDUs where TPG had already installed its FTTB infrastructure, Morrow said.
"If TPG were to get there first, from a business point of view [the problem] is not the technological limitation," he said, "because you could still run fibre up to the rest of it and bypass the copper induction factor that occurs."
TPG began live trials of the technology in March, offering services to customers in Pyrmont, Ultimo and the Sydney CBD; Southbank, Docklands and the Melbourne CBD; and Fortitude Valley and the Brisbane CBD.
NBN Co has fast-tracked the rollout of FTTP to those buildings and will, Morrow confirmed during the hearings, be delivering FTTP to select MDUs by the end of the financial year.
That did not mean all MDUs serviced by TPG would get NBN Co FTTP, however.
Commercial, not technical imperatives would guide NBN Co's decision about whether to deploy infrastructure in such buildings, Morrow said, because if TPG were able to cherry-pick the most profitable buildings the lost revenues would affect NBN Co's revenues "considerably".
“The reason why we would have to hesitate as to whether we could go in there is because the model shifts considerably,” he said. "If all those buildings have been served and there's very little revenue to be had in there, that raises questions with the economic model that's been put together for the NBN.”
"We have no opinion or concern about which way this gets resolved; it just needs to be noted. If we go from TPG to a competitive market in that space, it's an issue that must be addressed."
NBN Co is currently developing its FTTB product and expects to bring it to market in October.