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Australia - The Emerging FttH Market

This annual report offers a wealth of information on the emerging FttH market in Australia. The report includes analyses, statistics, forecasts and trends. It provides a comprehensive insight into the progress of the developments and examines the key issues in the market and the business opportunities arriving from these new developments. The proposed National Broadband Network - promising to deliver FttH to 90% of the population - features prominently in the report.

  Subjects covered include:

  •          High Level Overview of key international developments.
  •          Global overview of subscriber statistics.
  •          The key to commercial viable FttH is a trans-sector based approach.
  •          Economic multiplier effect of FttH infrastructure for health care, education and smart grids.
  •          The $43 billion national broadband initiative in Australia is leading the world.
  •          There are many aspects that need to be implemented in the right way; the infrastructure company, the regulations and the demand side.
  •          The latest developments in the FttH  projects, especially in Greenfield markets


FttH developments are gaining momentum.  

There is now widespread agreement that FttH is the future-proof infrastructure needed for the digital economy that is going to propel us into a sustainable level of recovery after the financial crisis. It is essential for a new way of delivery of services such as e-health, e-education, energy-saving applications and e-commerce, as well as for Internet access and entertainment.  

In 2009 Japan continues to lead the world in terms of FttH subscribers, but South Korea has the highest penetration in the world. The USA and parts of Europe are also rolling out FttH rapidly.  

But Australia has by far the most ambitious plan.  

This report provides an analysis of the market, including a look at the various business drivers, future opportunities and current business models. It also identifies the leading markets and supplies statistics and forecasts.  

Different business models are being used around the world to find solutions for the expensive deployment of new fibre networks. Some are based on video entertainment; others on social services (healthcare and education); others are looking at technology innovation and export; and many simply will go with the flow - Australia can take international leadership, which will be a boost for its economy.

  We discuss costs and forecasts; however, national fibre rollouts will need to go hand-in-hand with digital economy applications if they are to work financially and economically. The National Broadband Network proposed by the Australian Government is the most visionary initiative ever undertaken anywhere in the world. It also future-proofs Australia’s regional and rural networks.  

BuddeComm has been discussing at length the opportunities within the ICT industries for utilising new telecoms networks for e-health, e-education, smart grids (managing renewables, saving energy), etc; and the Australian Government is now leading the world in trans-sector thinking, which is essential to guide us through the next stage of human evolution. In the report we draw attention to the importance of this concept - that of looking across sectors to create synergy.  

The report discusses the way this new kind of thinking also applies across infrastructure projects - in addition to telecoms and electricity networks, potential synergies exist between the building of roads, sewerage systems, water and gas pipe networks. It also tracks the initiatives announced by the government since the NBN.  

The government’s decision to invest $43 billion in a national FttH broadband network is a clear indication that it believes broadband infrastructure is a collective good. With its trans-sector multiplier effect the infrastructure will deliver massive social and economic benefits. There is no other way - if you want to build a digital economy you need FttH, and for it to work it must be built by a utility. Early indications that Telstra is going to cooperate are very promising.  

This new broadband plan offers unprecedented opportunities for Australia - not just in relation to telecommunications, broadband and the Internet, but also for a range of new applications, most of which we can’t even envisage at this point in time. This report addresses the enormous opportunities that the infrastructure - as a utility - has to offer, and also explores at a high level the issues that need to be addressed.  

One critical issue is that it needs to be recognised as the infrastructure for the digital economy. To simply see it as an upgrade of ADSL broadband would be a grave mistake. In this context the report is complemented with observations by both the Digital Economy Industry Working Group and our International (Obama Team) Big Think Strategies Group.

  Bright in Perth carried out the first major rollout - this was perhaps too early for its time, as it was abandoned in 2007. The country’s first large-scale FttH rollout is now taking place in Tasmania as part of the NBN. It will build on some previous projects, including the TasCOLT FttH project and Aurora’s BPL project.

  The most advanced fibre network developments are taking place in R&D and university networks, where AARNet is taking an industry leadership role.  

Throughout 2007 Australia saw a dramatic rise in the number of FttH operators and this continued in 2008. But the national approach has given rise to renewed confidence, and the future seems secure for further, even more rapid deployments in 2009 and beyond. The deployment of FttH in greenfield estates is a dramatically growing industry; however, while the design of a fibre solution might be perceived as a rather simple task, achieving a correct design and then operating it effectively and with long-term success is quite a different matter.

1. Overview & Statistics
1.1 Introduction: FttH going forward
1.1.1 Stimulus driving optical developments
1.2 Fibre-based access
1.2.1 Early trials - brief overview
1.2.2 Massive changes in network management required
1.2.3 Low hanging FttH fruit
1.2.4 Consumer benefits to low-cost fibre
1.2.5 FttH deployment costs
1.2.6 Enterprises not driving FttH
1.3 Leading markets
1.3.1 Asia
1.3.2 USA
1.3.3 Europe
1.4 FTTx market statistics
1.5 Regulating fibre: a global issue
1.5.1 Regulating copper networks - a lesson
1.5.2 Networks under strain
1.5.3 The stronger case for fibre
1.6 FttH drivers
1.6.1 National economy drivers
1.6.2 Social drivers
1.6.3 Entertainment drivers
1.6.4 Business drivers
1.6.5 No e-government without fibre
1.6.6 ‘Go with the flow’ strategies
1.7 FttH business models
1.7.1 Vertically integrated model
1.7.2 Open network model
1.7.3 Structural separation a must for FttH
2. Trans-sector Thinking
2.1 Introduction
2.2 Australian leadership
2.2.1 Digital Economy Industry Work Group (DWEIG)
2.2.2 Trans-sector project: smart grids
2.2.3 Trans-sector project for social services
2.2.4 Smart infrastructure
2.2.5 Trans-sector project e-health
2.3 National welfare depends on new thinking concepts
2.4 work in progress: political leadership
2.5 Trans-sector thinking at highest levels in Australia
2.6 The multiplier effect
2.7 Smart communities, where do we start?
2.8 We lack the structures to implement trans-sector visions
2.9 Trans-sector regulation
2.9.1 Regulations need to be rewritten
2.9.2 FttH will change telecom models
2.9.3 Utilities-based regulation
2.10 The sectors
2.10.1 Telecommunications
2.10.2 Government communication and information
2.10.3 Healthcare
2.10.4 Education and e-science
2.10.5 Smart grids
2.11 Smart communities and smart buildings
2.12 Smart cities introduction
2.13 Building smart cities to ease the stress
2.13.1 A population of nine billion people
2.13.2 The role of smart cities
2.13.3 We need to use people power
2.13.4 Education, information, empowerment
2.13.5 Changes are starting to drive action
2.14 Key components of smart cities
2.14.1 Smart buildings/homes
2.14.2 Smart grids
2.14.3 Home networks
2.14.4 Next generation telecoms
2.14.5 Open networks
2.15 Strategies for smart communities
2.15.1 Tran-sector thinking
2.15.2 Rebuilding communities
2.15.3 Greenfield communities
2.16 Brief examples of smart communities
2.16.1 India
2.16.2 China
2.16.3 Europe
2.17 Intelligent/smart technologies and systems
2.18 Intelligent Communities Forum
3. National Broadband Network
3.1 Overview & analysis
3.1.1 Details of the NBN proposal
3.1.2 National Broadband Corporation
3.1.3 Regulatory issues
3.1.4 FttH infrastructure
3.1.5 The business model
3.1.6 NBN is moving in the right direction - analysis mid-2009
3.1.7 The early projects
3.1.8 Trans-sector thinking
3.1.9 Open network = innovation and affordability
3.1.10 Co-development of fibre and the digital economy
3.1.11 What’s next for Telstra?
3.1.12 No policies, just opposition from the Opposition
3.2 Critical considerations
3.2.1 Governance and management of the NBN/NBC
3.2.2 Regulations - critical considerations
3.2.3 Wholesale
3.2.4 Technology critical consideration
3.2.5 Basic infrastructure
3.2.6 Co-development of the Digital Economy
3.2.7 Strategic differences of an NBN
3.2.8 Comments from international experts
4. FttH Market Analyses
4.1 Analysis
4.1.1 FttH becoming a reality
4.1.2 FttH starts making business sense
4.1.3 FttH still an expensive exercise
4.1.4 Mass market FttH still years away
4.2 FttH and the digital economy
4.2.1 Co-development is essential
4.2.2 Infrastructure comes before services (unfortunately)
4.2.3 Whole-of-government approach is essential
4.2.4 No digital economy without open networks
4.2.5 The Rudd Team provides national leadership
4.3 Different FttH business models
4.3.1 Clever network rollouts and home installation
4.3.2 New housing developments
4.3.3 Start with low-hanging FttH fruit
4.4 Different fibre scenarios
4.4.1 FttN versus FttH networks
4.4.2 Telstra’s initial FttN plan
4.4.3 Cabinetisation in New Zealand
4.5 FttH and the electricity infrastructure
4.6 Forecasting FttH
4.7 Regional fibre
5. Operators and Retailers
5.1 Introduction
5.2 Network operators
5.2.1 Summary of FttH network operators
5.2.2 Arise
5.2.3 Broadcast Engineering Services (BES)
5.2.4 Clubcom Utilities
5.2.5 GeoMedia
5.2.6 HaleNET
5.2.7 OPENetworks
5.2.8 Opticomm
5.2.9 thePacific.Net Limited
5.2.10 Pivit
5.2.11 FuzeCONNECT / Service Elements
5.2.12 Silver Telecom
5.2.13 Telstra
5.2.14 TelstraClear
5.2.15 TransACT Communications Pty Ltd (TransACT)
5.3 Retailers
5.3.1 Service pricing
5.3.2 Starter packages
5.4 Private networks
5.4.1 Belswan Retirement Village case study
6. Projects and Developments
6.1 COLT - Ballarat
6.1.1 Optical fibre network
6.1.2 Wireless broadband
6.2 Tasmania
6.2.1 Australia’s FttH testbed
6.2.2 Analysis of Tassie’s broadband history
6.3 FttH broadband proposal for Brisbane
6.4 Western Australia
6.4.1 FttH in Perth - discontinued
6.4.2 BES projects in WA
6.5 ICON (intra-government communications network) - ACT
6.6 R&D, science and education projects
6.6.1 AARNet
6.6.2 CeNTIE
6.6.3 GrangeNet
6.7 National FttH Plan
7. Greenfield Projects & Providers
7.1 Definition of terms
7.2 The importance of broadband
7.2.1 Market demand
7.2.2 Key issue for land developers
7.2.3 The USO and greenfields
7.3 Statistics on fibre-enabled communities
7.3.1 Communities by state
7.3.2 Communities by provider
7.3.3 Communities by developer
7.4 Summary of key communities
7.4.1 Aurora, VIC
7.4.2 Banksia Grove, WA
7.4.3 Coomera Waters, QLD
7.4.4 Emerald Lakes, QLD
7.4.5 Fernbrooke, QLD
7.4.6 Lyons Estate, NT
7.4.7 Prince Henry at Little Bay, NSW
7.4.8 Somerly, WA
7.4.9 TasCOLT, TAS
7.4.10 Varsity Lakes - The Landing
7.5 List of FttH communities
8. Glossary of Abbreviations
List of Tables and Exhibits
Table 1 - Estimated costs of fibre deployment - USA
Table 2 - Fibre penetration per home passed, select European countries - January 2009
Table 3 - Proportion of fibre subscribers per home passed, select European countries - January 2009
Table 4 - European FTTx subscribers and homes passed - 2007 - 2008
Table 5 - Worldwide top 10 markets with FTTx penetration > 1% - 2007; 2009
Table 6 - Worldwide FTTx subscribers - 2007 - 2008
Table 7 - Worldwide FTTx share of broadband market - 2004; 2006 - 2008
Table 8 - Worldwide FttH port shipments - 2007 - 2008
Table 9 - Worldwide market share of FttH port shipments by technology - 2007 - 2008
Table 10 - Homes connected to fibre - 2005 - 2010
Table 11 - FttH communities in Australia and New Zealand - 2008
Table 12 - Percentage of connected homes in Australian states and NZ - 2008
Table 13 - FttH communities in Australia and New Zealand by provider - 2008
Table 14 - Percentage breakdown of FttH communities by provider - 2008
Table 15 - FttH communities by developer - 2008
Exhibit 1 - Explanation: optical fibre
Exhibit 2 - Broadband - infrastructure blueprint
Exhibit 3 - Smart City - Masdar City - Abu Dhabi
Exhibit 4 - Smart homes
Exhibit 5 - Learning from e-cars
Exhibit 6 - FttH prerequisites
Exhibit 7 - Residential broadband (BB) growth predictions - next ten years
Exhibit 8 - Infrastructure blueprint
Exhibit 9 - Summary of FttH network operators
Exhibit 10 - Overview of FttH retailers - 2008
Exhibit 11 - FttH R&D projects from TasCOLT
Exhibit 12 - GrangeNet consortium members and role
Exhibit 13 - Terminology definitions
Exhibit 14 - List of active FttH communities in Australia - July 2008
Exhibit 15 - List of proposed FttH communities in Australia - July 2008
Exhibit 16 - List of active and proposed FttH communities in New Zealand - July 2008

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