Telstra walks while telco D-team squawks

The Alliance for Affordable Broadband (AAB) is the latest group to argue the merits of nationwide wireless broadband. However, AAB's arguments are muted by the glimpse of Telstra's own vision of the future with its South Brisbane infrastructure exchange.

The argument that wireless services are a better replacement for copper lines than fibre-optic cabling has gained a surprising amount of momentum from Tony Abbott's coalition and like-minded fiscal conservatives, but the best evidence yet that the so-called "NBN 3.0" alternative is wrong — and that fibre is, simply put, right — has come recently from the one company that stands to lose the most from Labor's planned National Broadband Network (NBN).

That company is Telstra, of course, and the thing it has done to discount wireless end-user connections is to upgrade its copper fixed-line network in South Brisbane. But as it moves to disconnect around 18,000 customers from its copper network, decommission that network and upgrade services in the area, Telstra is not looking towards wireless as a replacement for its copper.


(Kaka parrots image by Kakahead.com, CC BY-SA 2.0)

No, despite having invested heavily in its own wireless network in recent years, Telstra is installing an extensive fibre-to-the-premises (FTTP) network. Yes, fibre.

It's seemingly enough to make the members of the Alliance for Affordable Broadband (AAB) cry. This group of wireless and fibre backhaul operators, of course, has argued in an open letter to the world that a wireless and fibre backhaul network is the best option for moving Australia's telecommunications services forward.

Of course, they would say that. After all, Pipe Networks sells fibre backhaul that could become largely unnecessary if NBN Co completes its network build. BigAir sells fixed wireless broadband services. Vocus, a voice and data provider with a string of start-up awards under its belt and a board that includes Australian internet pioneer David Spence, will similarly struggle. AAPT is an infrastructure operator that's had its own share of problems and would seemingly hate to become nothing more than a reseller of NBN Co's services. Polyfone operates fixed wireless internet services spanning from Byron Bay to the Sunshine Coast. EFTel is a bit player that has ambition if not tier-one clout.

And Allegro Networks, as its website tells us, has "an exclusive licence to use WiMax spectrum covering 16 per cent of the Australian population", giving it the potential to supply the kind of end-user connections that the Coalition and other wireless advocates dream about. But its south-east Queensland WiMax services were launched back when Helen Coonan was communications minister, and to say that it's an alternative to fixed networks is, well, rich.

Speaking of rich, underlying these discussions is another, bigger question: who would pay to fund NBN 3.0?

Some argue that Telstra's strategy of replacing its copper with fibre is simply an effort to dodge competition by rolling out an infrastructure that its competitors can't access ... [but] it's nothing that can't be addressed through industry negotiation and, if necessary, pressure from the government.

AAB's members argue that a nationwide network could be built for around $3 billion, making even the Coalition's fiscal conservatism seem generous by comparison. But they remain hush-hush on the question of whether they're prepared to foot the cost. This raises several questions: is NBN 3.0 just a desperate attempt to raise their profiles? Are they agitating for government favour and taking early shots at the wireless broadband market that will eventuate if the Coalition wins? Are they hoping to reassure independents that they can support the Coalition's broadband plan while delivering an acceptable broadband outcome for their rural constituencies?

Or is the whole thing just — and this may be the most likely reason of all — an effort at self-interested spruiking? Are they just sensing that a fibre NBN will substantially diminish their businesses, and trying to launch a pre-emptive shot across the network's bow before Gillard gets a chance to smash the champagne on it?

Well, yes, and yes. The extent of the AAB carriers' self-interest in the proposal has been discussed widely in the tech media, and even admitted openly by Polyfone CEO Paul Wallace.

Some argue that Telstra's strategy of replacing its copper with fibre is simply an effort to dodge competition by rolling out an infrastructure that its competitors can't access. This may be the case in its move to switch South Brisbane to FTTP, and needs to be examined, but it's nothing that can't be addressed through industry negotiation and, if necessary, pressure from the government.

After all, the last thing the industry needs is a recalcitrant Telstra refusing to resell its fixed, undeclared services and forcing would-be competitors to chase it around Australia laying fibre in some sort of replay of the Telstra-Optus hybrid-fibre coaxial wars of the late 1990s or the Telstra versus RestOfTheWorld ADSL2+ wars of the 2000s. Yet, if Telstra were trying to block out competitors, it could have done so just as easily "and far more cheaply" by connecting these premises to its Next G network which, wireless' advocates so happily shout out, is now Really, Really Fast.

AAB may have been trying to award a free kick to the Coalition's NBN plan, but Telstra just gave one to Labor's model — and reaffirmed that the AAB perspective is tangential to that of the majority of the telecoms industry.

Not even Telstra, which has gone to great lengths to promote Next G's wireless-broadband credentials, sees it as a replacement for fixed-line connections. AAB may have been trying to award a free kick to the Coalition's NBN plan, but Telstra just gave one to Labor's model — and reaffirmed that the AAB perspective is tangential to that of the majority of the telecoms industry.

I suspect that Tony Abbott would want more-influential backers — and, perhaps, ones that had injected this argument into the debate before the election. That was, you recall, when the Coalition was trying to convince everybody that the private sector would take care of building networks to remote places, and that the real cost of a 12Mbps next-generation network was far lower than Labor is suggesting. For Abbott to have had a real, live contingent of telecoms executives that were willing to pony up to build a nationwide wireless network, would certainly have given him something to point to.

But now, all the AAB has provided is a biased plan provided by confessed self-interested niche market players. The group's members are big on ideas, but their proposal raises so many questions that Computerworld Australia took the rather novel approach of writing its own open letter with 20 quite well-postulated questions.

And what of the rest of the industry? Is AAB suggesting that the entire industry should chip in and build a next-generation network together? Do its members expect the pro-fibre contingent to just sit back and watch themselves cut out of market opportunities as wireless operators step front and centre?

It may be that wireless can be built for less than fibre — although even that contention may be exaggerated if some analysis is correct. The real issue is whether it's an appropriate choice for the future of our broadband infrastructure. AAB says it's fine — but their self-interested position dilutes the value of their arguments. Common sense, a whole lot of people who know better, and even Telstra with its fibre-based investment strategy, suggest that it is simply inadequate. Given all this, AAB's proposal may die a quick death in obscurity; but with proposals like this still being floated, one wonders how many times the country will have to cover the same arguments before the industry can forge a united plan for the future.

What did you think of AAB's plan? Could it really fly and cost just $3 billion? And is its parade simply being rained on by a bunch of fibre-loving people with their own vested interests?