The future commercial viability of Australia's National Broadband Network (NBN) company will rely on technology evolution to increase speeds and capacity, according to a report by Ovum commissioned by Nokia.
Calling NBN's approach "fibre to the most economic point", Ovum's A Vision for NBN Evolution: A report for Nokia said that given the rollout has passed its halfway mark, NBN should shift its focus to upgrading the technology on its multi-technology mix (MTM).
"As mass deployment objectives are achieved, the focus of the Corporate Plan will need to continue to transition to provide additional detail of the upgrade path for the network," Ovum's report, published on Monday, said.
"Future Corporate Plans can thus become a vehicle for illustrating the options NBN is developing to address future demand, as well as outlining financial and operational goals."
NBN's MTM positions it to take advantage of a range of technology upgrades, Ovum said, but the network must evolve to support its objectives for uptake and average revenue per user (ARPU) out to 2025.
"NBN has the methodology and standardised technology options for next-generation evolution of its network and to create a sustainable national asset," Els Baert, Nokia manager of Fixed Networks Strategy Engagement, added.
"Technology pathways are open and well developed in different network domains. A key aspect for the next phase will be a unified access architecture to simplify network elements, add flexibility, reduce operational costs, and improve experience."
For NBN's fibre-to-the-node (FttN) and fibre-to-the-building (FttB) networks, Ovum said Vplus, G.fast, and XG-FAST could be used to upgrade capacity and speeds. VDSL currently limits these networks to 100Mbps.
While NBN has not made an announcement on Vplus -- a copper-based technology that fills the gap between G.fast and VDSL2, allowing speeds of around 200Mbps on copper wire lengths of 500 metres, and speeds of 300Mbps on 250m copper wiring -- the company will be launching 1Gbps-capable G.fast in 2018 across FttN, FttB, and its upcoming fibre-to-the-curb (FttC) networks.
Trials of G.fast between Nokia and NBN back in 2015 attained speeds of 522/78Mbps over an FttB connection with 100m of copper, with Nokia also trialling XG-FAST in August last year for speeds of 8Gbps.
The options for NBN's hybrid fibre-coaxial (HFC) network outlined in the report were DOCSIS 3.1 and Full-Duplex DOCSIS -- both of which NBN is actively looking into. NBN is aiming to launch DOCSIS 3.1 at the end of next year after trials in February 2018.
Arris president of Network, Cloud, and Services Dan Whalen told ZDNet that Arris is also in talks with NBN on the Full Duplex upgrade in line with its trials and full-scale deployments across the globe in 2019.
"I would say if it was available today, NBN would be wanting to deploy it today," he said.
Lastly, Ovum pointed towards XGS-PON, TWDM-PON, and NGPON as the upgrades available for NBN's fibre-to-the-premises (FttP) network.
"XGS-PON is the next evolution fibre technology allowing for 10Gbps symmetrical bandwidths using cost-effective non-tunable optics. This approach allows [providers] to add wavelengths to existing fibre and generate revenue with premium 10G services," Ovum said.
"TWDM-PON allows for up to 40Gbps symmetrical bandwidths by using multiple wavelengths and tunable optics. TWDM-PON provides an extra level of flexibility as it supports multiple use cases: Mobile backhaul, symmetrical business services, remote node backhaul for other networks such as copper and HFC.
"NGPON converges TWDM-PON, XGS-PON, and GPON technology on the same fibre."
Nokia is already working with NBN on trialling NGPON2 across FttP, which would bring speeds up to 10Gbps.
Despite urging NBN to plan and implement these upgrade paths, however, the Ovum report backed up recent arguments by NBN CEO Bill Morrow that users don't need and wouldn't use 1Gbps services, agreeing that the company should avoid pushing this.
"While gigabit services are an appealing goal, launches of these services have largely been a result of marketing arms races in other markets," Ovum claimed.
"Ovum's analysis of the user cases for, and deployment of, gigabit broadband services continues to conclude that the availability of these services is largely a marketing strategy."
According to Ovum, there is still no "killer application" that requires 1Gbps speeds; the price that would be charged for these services does not justify the capital investment required to provide them; and their deployment elsewhere in the world has been mainly for the purpose of product differentiation.
"Continuing the MTM strategy of leveraging the existing asset base remains the most compelling economic path to selectively deliver the hundreds of Mbps that high-use customers will demand during the next decade," Ovum said.
The report also recommended that NBN make full use of its existing assets, including its node cabinets to locate fibre backhaul systems to reduce the cost of FttC and FttP deployment and offer direct fibre services in the business market; its conduits to deploy fibre "deeper into the network and closer to end-user premises"; its pits to house FttC DPUs; its copper and HFC lead-ins across all network types to save on deployment costs; and its HFC amplifiers and splitters to locate future fibre backhaul termination points for HFC upgrades.
According to the report, by 2021, Australia will rank 15th globally in terms of availability of broadband of at least 30Mbps, with Ovum again citing the MTM.
"Despite Australia's geographic size, Ovum Broadband Development Index projects Australia's fixed-line rank will climb from a low of 40th in 2016 to 15th in 2021," the report said.
"The high ranking reflects the balancing of government objects for ubiquitous coverage with a platform that meets current and immediate needs, with flexibility to respond to growth in demand, instead of offering higher speeds in localised market segments."
NBN must also deal with the threat of 5G, however, as by 2025 these mobile networks will be well established and potentially eating away at NBN's use cases and customer base, including home connectivity, connected vehicles, hotspots, connected healthcare, and "Industry 4.0", Ovum said.
"The emergence of the next generation of wireless services and the positioning of these services in the market is a key uncertainty that may impact the overall level of fixed-line demand," the report warned.
Ovum suggested that NBN turn 5G into another business opportunity by providing connectivity to small cells.
"NBN can be expected to play a role in enabling the deployment of 5G services. 5G is expected to require many more small cells than currently deployed across operators' networks, each requiring connectivity to the network core," the report explained.
"NBN, with capacity passing every premises in the country, may be well placed to provide connectivity to these small cells."
In total, Ovum's report made four recommendations for NBN: Continue to develop its tech roadmap; maximise opportunities to utilise existing assets; develop a business case and funding model for future upgrades; and drive demand for higher-speed services.
"The Australian government, NBN, and the RSP community need a cooperative approach to support growth in demand for NBN services," Ovum said.
"Failure to drive demand for faster speeds opens the risk that ARPU and revenue targets will not be achieved, and competing commercial wireless services will become a viable substitute for a broader segment of the NBN customer base.
"NBN and its shareholders should now be looking to define and communicate their long-term vision for the NBN ... where the technology is available, the opportunity to deploy the latest evolution should be pursued."