NBN Co will need to undertake a “high-risk” IT systems redevelopment project so extensive and complex that it threatens the ability of the Abbott government to meet its fibre-to-the-node (FttN) rollout targets, the company has warned in official advice to new communications minister Malcolm Turnbull.
Significant expenditure on supporting IT systems has already accompanied the rollout of Labor's fibre-to-the-premises (FttP) model, with contracts such as a $200m, a $38m splash on Cisco Systems and $9.5m spent on Cisco supporting the extensive operational support systems and business support systems (OSS/BSS) necessary to keep the $37.4 billion network running.
Were the project to change to a largely FttN-based model as proposed by the new Coalition government, however, these systems – and others handling tasks such as fulfilment, assurance, resource management, billing, integration and business-to-business integration– would need to be redeveloped to suit the different capabilities and product range of an FttN environment.
Core operational systems are immensely complex, particularly when tied in with an ongoing network rollout. For example, NBN Co originallyfor an OSS/BSS vendor in early 2010 but didn't appoint IBM until more than a year later. The contract was let under three-year terms – which would put its completion date at early next year – and was designed to be implemented in four stages.
With the fibre-to-the-premises (FTTP) rollout already underway, the confidential report – obtained by Fairfax Media and ZDNet Australia – warned the shift to a fibre-to-the-node (FTTN) strategy would require the systems' design and progress to date to be revisited and revised to cater for the substantially different range of FttN products available on the new network.
"Under the Coalition's plan, NBN Co will be deploying, operating and maintaining four access networks (FTTP, FTTN, Fixed Wireless and Satellite)," NBN Co warned. "It is likely that the level of complexity involved will drive increased operating costs in areas such as increased headcount, management costs, and IT costs."
"[OSS/BSS] developments have long lead-times, and would be considered a high risk to deployment timeframes.... it is likely that IT systems' development, maintenance complexity and costs will increase.”
The risk would increase significantly if NBN Co acquired Telstra's copper access network (CAN), which already has its own OSS/BSS systems that would be difficult to link with those used by NBN Co.
“If NBN Co were to acquire the copper network significant IT development would need to be undertaken to manage and operate the copper,” the report warns. “International experience indicates that existing legacy systems for the management and operations of the copper network can only be maintained and operated by the incumbent, and therefore entirely new systems would have to be developed.”
To avoid this risk, NBN Co expressed a “strong preference” that NBN Co buy a managed service from Telstra that “would minimise the extent of new IT systems that would need to be developed”.
Regardless of how NBN Co accesses Telstra's copper, NBN Co warned that OSS/BSS systems would need to be redeveloped for a VDSL2 FttN network. This would require collection of sufficient data for planning processes; construction to be undertaken; the start of services; and support for the new broadband products to be delivered in a VDSL2 environment.
NBN Co flagged extensive changes that would need to be made to the OSS/BSS systems, including adjustments to the systems' physical inventory, supply chain management, asset management, migration project management, pre-order and order management, billing, testing and diagnostics, incident and alarm management, and more.
Each of these systems “would need to be tested and operating before the VDSL network goes live,” the report said. “NBN Co notes that these developments have long lead-times, and would be considered a high risk to deployment timeframes.... it is likely that IT systems' development, maintenance complexity and costs will increase.”
The advice was prepared by NBN Co at the request of the former Department of Broadband, Communications and the Digital Economy (DBCDE) during the pre-election caretaker period, and was intended to form part of the 'blue book' briefing that contains over 500 pages of background and advice for the incoming minister on the NBN and other issues across his portfolio.
The reportby Turnbull's department despite widespread calls for its release. However, a draft of the report warned that the project was “unlikely” to meet Turnbull's election promise of delivering 25Mbps to all Australian premises by 2016 and 50Mbps to 90 percent of premises by 2019, unless twelve significant issues were resolved within the next 18 months or so.