NBN Must Speed Up to Hit 2020 Targets, Says Senior Exec

Few infrastructure projects funded from the public purse have aroused as much controversy as Australia's national broadband network.

Designed to put Australia at the forefront of the global connected economy, the original scheme, announced under a Labor government in 2009, sought to connect 93% of homes and businesses to lightning-fast fiber-to-the-premises (FTTP) technology. Critics had derided the impracticality of the approach, which was expected to cost as much as A$43 billion (US$32.3 billion, at today's exchange rate), and the Liberal/National Coalition that was elected in 2013 quickly reined it in. NBN Co Ltd. , the wholesale operator building the network, is today using a mixture of technologies to provide broadband connectivity, disappointing high-speed enthusiasts. Concern about the cost of the initiative persists.

NBN Co is steaming ahead nonetheless. By 2020, its goal is to be the only major fixed-line infrastructure provider in the country, as older services are decommissioned. In a high-profile example of "structural separation," whereby retail and wholesale network businesses are broken apart, Telstra Corp. Ltd. (ASX: TLS; NZK: TLS) and Optus Administration Pty. Ltd. , the established private sector players, are transferring network assets to NBN Co. "In 2009 the government said it would compensate Telstra and Optus for making them disconnect their networks, but in 2013 we acquired the option to reuse those networks for the same price," says JB Rousselot, NBN Co's chief network operations officer.

Rousselot insists that NBN Co is making good progress on network rollout, but he also acknowledges the company will have to speed up its act to hit targets. In its 2016 fiscal year (which ended in June), NBN Co doubled its coverage footprint to about 3.2 million premises and the number of customer "activations" to about 1.2 million. By 2020, it needs to provide a service of at least 25 Mbit/s to 8 million homes and businesses across Australia. "That is hugely challenging," he told an audience at the recent Broadband World Forum in London. "It is going to require a huge effort from everyone but we've got a great track record of achieving and we've hit operational and financial targets for the last nine quarters in a row."

JB Rousselot, NBN Co's chief network operations officer: "We've got a great track record of achieving and we've hit operational and financial targets for the last nine quarters in a row."

In theory, network rollout should become less taxing as NBN Co makes use of existing infrastructure and takes advantage of emerging technologies. Under the current plan, the company aims to connect 17-21% of premises using FTTP, 21-27% with hybrid fiber coax (HFC) and 43-54% through fiber-to-the-node technology. Those ranges give NBN Co some degree of flexibility, although it will also have to rely fixed wireless and satellite technologies to connect about 7% of buildings in more remote communities.

One technology that has caught its eye during the past year is G.fast, which boosts broadband connections over relatively short copper loops. During the past few weeks, NBN Co has announced plans to extend fiber to so-called "distribution points" near about 700,000 premises. By shortening the copper loop, the operator can deliver relatively high-speed connectivity using VDSL, an older copper-based technology. "G.fast might then be an extension of the VDSL product," says Rousselot. "We have done testing and are looking at results and it will probably have a place in our network." (See Australia's NBN Hits 8 Gbit/s on XG.FAST and NBN Looks to G.Fast to Reduce Fiber 'Hassle'.)

Next page: The difficult road ahead