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Australia - Broadband and the NBN Moving into 2014

Australia - Broadband and the NBN Moving into 2014

Broadband is growing in many different directions. Its geographical reach is extended day by day, mainly thanks to mobile broadband. There are now roughly 2.7 billion internet users. Its capacity is increasing through the inclusion of more and more fibre optic networks. There are now some165 million websites active in the world and 265 million registered domain names. The hundreds of millions of applications and services that they facilitate are an indication of  the social and economic importance of the underlying broadband infrastructure that is needed to deliver them. It is paramount that this infrastructure needs to be able to handle the capacity which is with cloud computing, data centres and M2M applications - increasing exponentially. With our social and economic reliance on these services and applications it is also essential that this infrastructure is robust and secure.

Australia is right in the front line of broadband policies, with the largest single investment in the development of a national broadband network anywhere in the world. Its developments are being eagerly followed by policymakers and business leaders around the world. There are now more than 130 countries in the world with a national broadband plan, clearly indicating that the majority of the world subscribes to the importance of this infrastructure.

Governments and industry agree that FttP is the preferred end-solution. What they are grappling with is how to best make progress here. In most countries the national telecom operators are leading these infrastructure developments. They all face the reality that, while large investments are needed for FttP, there is little chance that customers are prepared to pay more. We see similar developments in mobile, where big investments have to be made in spectrum and LTE without seeing an increase in ARPU. The national telcos operate vertically-integrated models and want to protect their ageing assets and business models for as long as possible as they do not see as yet a business model to upgrade to FttP.

Australia is one of the few countries where the telecoms market has been structurally separated. Telcos cannot own the FttP infrastructure in a vertically-integrated business model and for that purpose a separate wholesaleonly telecoms utility has been established, NBN Co. This model makes it easier to skip any intermediate technology such as, for example, VDSL and go straight into FttP. The new government, however, is currently investigating whether this is financially the best way forward. They prefer the intermediate step of FttN, using VDSL. But to date the government has not provided a plan for how it will then eventually move from FttN to FttP

This report looks at all of these issues and can assist in paving the way forward into 2014 and beyond.

1. Synopsis
2. The Global State of Broadband Report
3. The National Broadband Network
3.1 NBN Co given the opportunity to save the current NBN
3.2 The NBN and the competition issues
3.2.1 There is thriving competition in the telecoms market
3.2.2 Forty years too late
3.2.3 Who is going to invest in competing fixed infrastructure?
3.2.4 So what are the competition models from those promoting it?
3.2.5 Competition policy should be focused on the services, not the infrastructure
3.3 NBN Co faces the Australian economic dilemma
4. Telstra's cashflow may suffer from NBN rollout delays
5. VDSL and Vectoring
5.1 VDSL consideration for FttN roll outs
5.2 VDSL an interim solution
5.3 FTTN modelling results
5.4 The aesthetics of the cabinets
5.5 Reliability and performance of the cabinets
5.6 Issues in relation to savings coming from sharing infrastructure
5.7 The risk of short-circuiting
5.8 The pros and cons of vectoring
6. What PRISM, credit card hacking and Chromecast have to do with FttH
7. Will LTE steal the broadband revolution?
8. Other Reports

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