NBN: The Economics of FTTH vs FTTN

Do you know a Bargain when you see one??
Is either NBN Policy proposal offering a bargain or the opposite, a "lemon"?

NBN: After CommsDay, Questions for Mr Turnbull

In his CommsDay Conference 2012 address, Mr Turnbull came as close as ever to detailing the Coalition NBN plan, seemingly centred around a 25Mbps fixed-line FTTN.

These are some reasonable questions Mr Turnbull should answer to inform the electorate of the Coalition NBN Policy he is prosecuting. I can't see how he can meet any, let alone all, of the Coalition NBN promises - Cheaper, Sooner, More Affordable:

1. Given it took until early this year, 15 years since the start of the Domestic Internet Revolution, for the Coalition to grudgingly adopt a Fast Broadband Policy, What guarantee do we, the electorate, have that the Coalition will fulfil its promises, not revert to its previous position and nationally deliver everyone The Gungahlin Experience?

2. The exact details matter in Technology Projects like the NBN and Mr Turnbull has shown his poor grasp of critical details, or willingness to disingenuously spin the facts. Sanity checks against previous deployments (Transact) and FTTN proposals (Telstra 2005) of Coalition claims of lower FTTN costs  and comparing FTTN and Fibre construction costs suggests that in achieving the Coalition promise "Better Broadband, Cheaper, Sooner and More Affordable", something different, and not yet disclosed, will need to be deployed:
1. Does the Coalition guarantee to match the current fixed-line coverage of 93% premises?
2. The Coalition demanded detailed, precise costings for the current NBN, it is their turn to provide them well, the sooner the better to allow a full discussion. Will Mr Turnbull release costings to the nearest $100MM in the near future?
3. The GPON NBN has a design life of 30 years starting with new cable and equipment, while the FTTN is End-of-Lifecycle technology using End-of-Life cables: Will Mr Turnbull release detailed comparisons of the Total Cost of Ownership of both proposals?
4. Mr Turnbull has implied the Coalition FTTN equipment will be field upgradable to Fibre.
1. Won't building a copper network to throw away be more expensive?
2. If the Coalition intends to deploy a Fibre solution, why not start with it?
3. Isn't adhoc, on-demand laying of fibre and digging trenches the most expensive and inefficient method of rolling out Fibre?

3. FTTN technology is a very poor fit for low-population density areas, such as the regional towns and rural areas. Costs escalate exponentially: copper-run distances increase, pushing down access rates and ports per node decrease geometrically, raising the per port costs. Will Mr Turnbull release early the detail of how he will guarantee metropolitan access rates for Country users of the Coalition NBN? Will he guarantee not to rely on expensive, congestion-prone Fixed Wireless (3/4G) for country areas?

For some Party Political questions, I've included two recent sets included in Ministerial media releases. Duplicated questions are coloured. While detailed, they didn't address many questions that I, as a voter, wanted answered.

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Senator Conroy: Questions for Mr Turnbull, 4-Sep-2012

POLICY (OWNERSHIP)

1. Does he accept that his FTTN network is a government monopoly network?
2. Will Mr Turnbull’s network be on budget or off budget? How much will his policy cost the budget?
3. Is Mr Turnbull really going to buy back the deteriorating copper network and its expensive maintenance costs? Will he also buy the Telstra ducts? Does he stand by his media release of 17 May 2011 that acquiring use of the copper would be “more billions out the door”?
4. Will he guarantee the structural separation of Telstra? Has it been agreed by shadow cabinet?

CAPACITY AND TECHNOLOGY

1. What upload and download capacity will Mr Turnbull guarantee?
2. Which of his previous statements does Mr Turnbull stand by when it comes to what speeds Australians need:
1. In August 2010, he said he could do everything he needed with 3.5 Mbps download[iv]
2. In October 2010, he said 12 Mbps is enough for anybody[v], and
3. In May 2012 he said residential customers need no more than 25 Mbps.[vi]
3. Will FTTN be built in areas where there is HFC? Who will pay to make the HFC open access, enter multi-dwelling units or provide a business grade service? Does Mr Turnbull accept that the upload capacity of HFC is limited to 2 Mbps? Will Telstra be required to divest the HFC assets?
4. How many FTTN nodes does he plan to build? What percentage of premises connected to each cabinet will be able to benefit from speeds of 80 Mbps?
5. How many more premises will be connected using wireless than under the Government’s NBN plans?

PRICES

1. What price will be charged in country areas without the cross subsidy? What will regional users be charged before Mr Turnbull’s on budget “vouchers”? How much will the vouchers be and how many will be issued?
2. Has shadow cabinet formally rejected the National Party policy that fibre to the home should be built to at least 50% of premises in regional Australia?
3. Does Mr Turnbull stand by his claim that his FTTN network will be required to generate a 7% return as claimed in his Op Ed in the Tele on 23 August?

HOW LONG IT WILL TAKE

1. How will he select the private network providers for the few areas he plans to build any new infrastructure?
2. Will he guarantee his new broadband policy will start within 12 months, despite his promise of a Productivity Committee review and tender for a private sector network provider?

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Senator Conroy: Questions for Mr Turnbull, 10-Oct-2012

COST

1. Will MrTurnbull's network be on budget or off budget? How much will his policy cost the budget?
2. Is Mr Turnbull really going to buy back the deteriorating copper network and its expensive maintenance costs? Will he also buy the Telstra ducts? Does he stand by his media release of 17 May 2011 that acquiring use of the copper would be "more billions out the door"?
3. Will he guarantee the structural separation of Telstra? Has it been agreed by shadow cabinet?

CAPACITY AND TECHNOLOGY

1. What upload and download capacity will Mr Turnbull guarantee?
2. Does he accept that his policy only commits to providing a 25 Mbps service?[iii]
3. Has shadow cabinet formally rejected the National Party policy that fibre to the home should be built to at least 50% of premises in regional Australia?
4. Will FTTN be built in areas where there is HFC? Who will pay to make the HFC open access, enter multi-dwelling units or provide a business grade service? Does Mr Turnbull accept that the upload capacity of HFC is limited to 2 Mbps? Will Telstra be required to divest the HFC assets?
5. How many FTTN nodes does he plan to build?

PRICES

1. What price will be charged in country areas without the cross subsidy? What will regional users be charged before Mr Turnbull's on budget "vouchers"? How much will the vouchers be and how many will be issued?
2. Does Mr Turnbull stand by his claim that his FTTN network will be required to generate a 7% return as claimed in his Op Ed in the Tele on 23 August?

HOW LONG IT WILL TAKE

1. When would his FTTN plan be finished?
2. How will he select the private network providers for the few areas he plans to build any new infrastructure?
3. Will he guarantee his new broadband policy will start within 12 months, despite his promise of a Productivity Committee review and tender for a private sector network provider? Will his "thorough inquiry into the management and governance of the NBN Co" be conducted at the same time as the Productivity Commission review of the project?

OWNERSHIP/POLICY

1. Does he accept that his FTTN network is a government monopoly network?
2. Will he commit to maintaining the network in government ownership till it is fully built?

NBN: FTTN in Australia - the Gungahlin Experiment

In 1995, Telstra announced that the new Town Centre in Northern Canberra, Gungahlin, would be a testbed for "broadband", with a $20-$30MM project announced laying "Fibre to the Kerb", which many people like me interpreted as "Fibre to the Home".

What Telstra deployed was RIM's, Remote Integrated Multiplexors, designed initially as an 'integrated' extension of the local Telephone Exchange. ADSL broadband was not supported. Instead of a world-class demonstration of the application and utility of fast broadband, Gungahlin residents were locked in a battle for even minimal access speeds.

For the rest of Australia, we have very clear demonstration of two things from this nearly two decade 'experiment':

• Fibre-to-the-Node, even 15 years ago when it was a much, much cheaper technology than Fibre-to-the-Premises, is fraught for consumers.
• Even when the subscribers thought they were out of the woods with high-speed ADSL 2+ available, the sting-in-the-tail of FTTN became apparent: congestion on the node "backhaul" makes line access rate irrelevant.
• The Coalition, during the Howard government from 1996 to 2007, did not prioritise, nor apparently see the need for, a National Broadband Network.
• It is only since the Telstra SSU agreements early 2012 that the Coalition has become committed to an NBN of any flavour.

NBN: Costing the Coalition FTTN. It's not Good News.

Mr Turnbull, in his CommsDay address, seemed to be proposing the Paul Fletcher, "Wired Brown Land" FTTN:

• 25Mbps guaranteed, VDSL2
• 800m max wiring (approx. 500m road distance)
• we can infer 40-60 subs per node, consistent with the 160 subs/node of the first Telstra FTTN.
• The "golden screwdriver" is "Multi-Service Nodes": field upgradable from copper to Fibre.

So, what's it going to cost to roll this out to 12M subs, the 93% of premises addressed by NBN Co?

Will Mr Turnbull achieve the Coalition tagline, "Better Broadband, Cheaper, Sooner, More Affordable"?