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7 1
Competition at
basement level
U
ntil recently the Commonwealth-
owned NBN Co. has primarily
used Fibre to the Premises (FTTP)
technology in its rollout of the National
Broadband Network (NBN), an Australia-
wide project to upgrade existing internet
network infrastructure, and in turn prepare
Australia for a digital-ready future.
FTTP technology connects fibre optic
cabling directly to each premise and is
perfect for standalone homes and ideal in
rural and regional areas, but difficult and
expensive to roll out in situations where
multiple homes or offices sit in the same
buildings – such as apartments, high-rises
and office blocks.
Fibre to the Basement (FTTB) technology
differs in that it runs fibre optic cabling to one
point in a building (usually the basement),
before switching to existing copper cabling
to complete the connection to premise.
While FTTP is faster, FTTB is cheaper
and far easier to roll out in high-density
areas. As such, FTTB – and its roll-out in
Australian cities – offers a lucrative market
for broadband companies.
For this reason, NBN Co. has been
hurriedly working to introduce its own FTTB
product. In May 2014, NBN Co. delayed
its FTTB product by “five months”; on 22
January this year it announced the location
of the first 2,000 premises to receive its FTTB
product by the end of March 2015. Pilot trials
are currently underway and the initial rollout
will be followed by a staged release rollout
across the country.
Meanwhile, TPG Telecom has been
offering an FTTB product since September
2013, when it launched its plan to provide
500,000 Australian premises with FTTB
services. It was able to launch what is
essentially a rival product to the NBN
because a legislative loophole allowed the
extension of fibre networks built before
January 2011, and TPG’s FTTB offering was to
be an extension of its existing network.
Despite this, TPG’s 500,000 FTTB rollout
was, and has remained, a controversial plan,
criticised by both NBN Co., and rival telcos
including Telstra and Sing-Tel Optus. Those
opposing TPG’s FTTB rollout argue that by
targeting only the lucrative city market, TPG
is taking the profits that could otherwise
be using to connect regional Australia – a
necessary, yet less lucrative job.
In other words, if NBN Co. could
generate profits by supplying FTTB
TPG Telecom has vowed to
fight back against new rules
that it claims stifle competition
to the Commonwealth-owned
NBN network. The Federal
Government argues it is acting
in the best interests of both
consumers and industry.
Caroline Reidy
investigates.
copper, fibre and wireless solutions for voice and data