Yesterday, NBN Co announced that it had successfully renegotiated its $11 billion deal with Telstra to acquire its existing copper network, as well as setting up contracts to buy and continue using the cable (HFC) networks owned by Telstra and Optus. While were seeing lots of high-fiving going on about the deal and how it might speed up the rollout of the National Broadband Network, there are still lots of uncertainties especially in terms of when consumers will actually get to enjoy the fruits of these arrangements. <\/p>\n
Champagne picture from Shutterstock <\/p>\n
These are the basic details, announced yesterday (I suspect that was a ploy to get onto the Sunday night TV news, invariably the highest-rated news broadcast of the week): <\/p>\n
The basic plan for NBN Co hasnt changed. Most premises will be serviced by fibre-to-the-node, with either a cable or copper connection to that node. Sites which already have fibre-to-the-premises get to keep it, and its possible (but unlikely) that might also be necessary in areas where the copper isnt up to the task. Remote areas will be serviced by satellite. <\/p>\n
While the deals represent progress, it is still a major backdown on the Coalitions pre-election NBN pledge that every household would have some form of access to the NBN by the end of 2016, with a minimum download speed of 25 megabits per second. By 2019, 90 per cent of households were predicted to enjoy minimum download speeds of 50 megabits per second. <\/p>\n
The first speed promise remains, but the time frame is much flabbier. Were now told that two million households will be connected by mid-2016, and that everyone will be connected by 2020. <\/p>\n
The second promise that 90 per cent of premises will have 50Mbps downloads remains in place, but has no time frame attached to it. This isnt surprising, since theres no clear way just yet that existing copper lines served from a local node can be upgraded to those speeds. And of course, when the original deadline to connect everyone has slipped by four years under the Coalition plan, its hard to stick to that kind of commitment. <\/p>\n
Its also worth bearing in mind that there are two potential legal roadblocks to the deals as announced. Firstly, the Australian Competition and Consumer Commission (ACCC) has to approve the deals. With a 200-page contract to consider, that wont be a speedy process (especially bearing in mind were about to hit the Christmas break). The Australian Taxation Office (ATO) also has to approve Optus financial interpretation of its sell-off. <\/p>\n
Add in the uncertainty over what kind of deal Telstra might make to help build the network, the highly variable nature of the copper network, and the list of reasons for delays NBN Co has already discussed, and 2020 seems like a very ambitious date. Ill stick my neck out and suggest there will definitely be delays. <\/p>\n
And finally theres the biggest unknown of all what upload speeds well actually get to enjoy. The Coalitions stated intention is that speeds will be proportionate, which tells us precisely nothing. While upload speeds will inevitably be slower than download, the ratio can vary a lot. Under the previous NBN plans, there were four ratios: 12:1, 25:5, 50:20 and 100:40. For any customers on a copper wire connected to a local node, lifes not likely to be much better than 12:1. <\/p>\n
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The NBN-Telstra-Optus Deal Is Still Overloaded With Unknowns<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" Yesterday, NBN Co announced that it had successfully renegotiated its $11 billion deal with Telstra to acquire its existing copper network, as well as setting up contracts to buy and continue using the cable (HFC) networks owned by Telstra and Optus. Continue reading