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NBN Co construction hits 1 million premises mark

This week, NBN Co commenced construction on its one millionth premises, the company said in a Senate Estimates hearing, where it also revealed that it has yet to gain access to any part of the hybrid fibre-coaxial networks that it expects will make up almost a third of its final footprint.
Written by Chris Duckett, Contributor and  Leon Spencer, Contributor

Despite the official rollout numbers for existing and new premises passed by fibre sitting at 435,570 and 138,453, respectively, and the total for all technologies being 711,149 premises, the company responsible for the deployment of Australia's National Broadband Network (NBN) has revealed in Senate Estimates that it will start construction on the  rollout to its one millionth premises this week.

In response to questioning from former Communications Minister Senator Stephen Conroy, NBN Co's chief operations officer Greg Adcock confirmed a report in The Australian citing the figure.

"That would be the construction — I believe that's right, yes, absolutely," Adcock said. "There's a difference between starting construction and passing a home."

Greg Adcock
Greg Adcock
Image: Greg Adcock

In April this year, NBN Co changed the methodology it was using to count premises passed in its official weekly rollout statistics, and said it would hold back areas from its premises passed statistics until 90 percent of customers have lead-ins installed and are able to order a service on the NBN.

Adcock said that one of the reasons for holding back areas was to prevent customers from believing they could order an NBN service, only to find that they had to wait three or four months for construction to be completed.

"I'm not saying premises passed is not a very valid construction metric — I utilise it internally," Adcock said. "But by putting it on a website, and giving a potential view that you are able to be connected because we've come past, was the reason we took it down.

"We are only putting new numbers on when they're ready for service and an end user can call up and get connected."

NBN Co also revealed that under its original premises passed metric, Tasmania currently has 54,873 premises passed with fibre from a "construction perspective", and construction contracts out to bring the total passed by fibre to the premises (FttP) up to 85,000.

The company reiterated its previous statements that the vast majority of the 115,000 premises left outstanding in Tasmania would be serviced by fibre to the node (FttN).

During the Senate Estimates hearing, NBN Co confirmed that it had connected 12 multi-dwelling units with fibre to the premises, and would be targeting 20 buildings a month after a switch to fibre to the basement, with the possibility that buildings may look to "co-invest" in an upgrade to FttP under NBN Co's upcoming fibre-on-demand product.

The fibre-on-demand product was announced in a statement last week that said the company is changing to a fibre-to-the-node by default stance, and that only those premises in the "advanced stages of being built" would remain in the FttP footprint.

It was separately announced on Thursday that 7,600 homes and businesses in Hobart and Launceston are scheduled to be progressively disconnected from the copper network from February 20 next year.

No access gained to HFC

Adcock also revealed that the company is yet to gain access to any part of the hybrid fibre-coaxial (HFC) networks that it hopes will make up to 27 percent of its national broadband footprint by 2019.

The HFC networks owned and operated by Telstra and Optus — networks utilising both optical fibre and coaxial cable for the delivery of Pay TV, internet, and voice services — are expected to be heavily used under the government's multi-technology mix model for the rollout of Australia's NBN.

Asked by the Greens party Senator Scott Ludlam whether NBN Co has been able to gain access to any part of the HFC networks in order to draw up an expected coverage map, and to conduct trials, Adcock said: "not at this point".

"Clearly, we're in discussions with both of the asset owners at the moment, and as those discussions progress, there are requests in the market for expertise around the head-end equipment," he said. "That's in the procurement discussion process at the moment. The plan is being finalised subject to the successful negotiations with the asset owners."

Adcock indicated that the company has not yet been able to draw up maps of the expected coverage provided by the HFC networks, due to the lack of access provided by Telstra and Optus to date.

NBN Co chief financial officer Stephen Rue, who also appeared at the committee hearing, said that HFC network trials have not yet started; the continuing agreement negotiations being carried out between NBN Co and the two telcos have prevented the company from beginning HFC trials.

"We're obviously in early stages of planning the HFC centres, and we clearly don't have access to any HFC networks at this stage," he said. "We would like to be in a position to launch HFC as soon as we can, but at the moment, we're still in discussions with various players, including Telstra and Optus."

In NBN Co's transitory corporate plan released this week, the recommended rollout "Scenario 6", aimed at minimising peak funding while also delivering a 50Mbps download data rate to up to 90 percent of the fixed-line footprint by 2019, forecasts that 27 percent — or 3.3 million premises — of the NBN footprint will be served by the HFC delivery technology.

However, the company also said that one of the plan's assumptions in drawing up its forecasts was that it would "be able to secure ownership and/or access to major existing network assets and passive infrastructure that are necessary for the implementation of the MTM deployment strategy (copper and HFC cable networks) on appropriate terms and within the envisaged timelines of the Scenario 6 (MTM)".

Rue said that access to the HFC networks and the deployment of commercial operations over the networks is entirely dependent on the continuing negotiations.

"[It] depends upon the timing of the negotiations with the owners of those assets, and also various regulatory clearances that will be needed, post those final [negotiations]," he said. "Those negotiations are still ongoing, and we're not in a position to comment on that. We would be hopeful that we could close those negotiations out this year."

Update: Article previously stated that the methodology changed in September, and NBN Co clarified that The Australian report was incorrect and it was one million overall connections, not solely fibre connections.

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