“Ah Netflix! We have heard so much about it”

Written by mcmjca


This appears to be the conversation going on in the NBN boardroom.


The Sydney Morning Herald article “The Netflix effect” provided an update the increasing data consumption in Australia public due mainly to the Streaming Video on Demand (SVOD). We read with interest on the ability to download faster using FTTP technology yet the government are defending the decision to roll out the FTTN technology instead.


What is the NBN’s target market with FTTN?

The National Broadband Network is a Government owned “Open Access Network” which will provide wholesale services to retailers to provide data services to Australian subscribers.

Fibre to the Node (FTTN) is a network architecture for which a Fibre cable feeds a node generally placed in a roadside cabinet. This then dissipates the service to each subscriber using copper pairs. DSL technology is what we have been sourcing for some time now, appears to be identical. Speeds are dramatically reduced each metre from the exchange.


Fibre to the Premises (FTTP) is literally a dedicated fibre cable from the equipment to the subscriber. FTTP which has been rolled out throughout Australia and the US with a proven low fault rates and no effects of distance.

The political history of Australia’s Broadband

2007 $958M OPEL joint venture announced to increase broadband to regional areas.

2007 Kevin Rudd, in what has become the norm, abolished the previous government’s plans at Taxpayers’ expense.

2008 A market exercise plotting Telstra, who submitted a non-conforming response, up against a conglomerate of “The Rest” who reportedly bid $15B. Moogy,2008).

2009 Following the Global Financial Crisis, the $43B National Broadband Network was announced along with NBN Co, a wholly government owned entity within the same decade of when Telstra was fully privatised.

2010 After a hung parliament, FTTP roll out continued to drag towards to start line.

2014 Change of government and a review of the NBN, FTTP was scrapped by the Tony Abbot based on claims of $2300 less to rollout FTTN compared to FTTP. Original speeds more than halved. The benefits of dragging Australia from the backrows of global broadband speeds and the perceived economic benefits that come with it are now questioned by each new prime minister.

Segmentation – Who is demanding high capacity/high speed broadband

Geographically the most populous areas are in the eastern states (18.4M of the 23.8M population Sept 2015) with a mean age of 35.8 against national mean of 37.3.

Victoria and Queensland are marginally below the national average of household disposable income. Tasmania and South Australia are further back in this field

Broadband users in Australia (12,946,000 in Dec 2015) used Mobile (46%) and DSL (39%) to access the internet. 21% are Business and Government. FTTP increased from 24,000 to 645,000 users since 2010. Now 5% of the market. 82% experience better than 8mbps speeds. (ABS 2015)

Australians spent 552,000 hours Googling in 2015 (Roy Morgan Research 2016). SVOD subscribers topped 3.7M in Australia in 2015 and downloads increased by 46% in 2015 (SMH, 2016).

Targeting and Positioning

NBN strategically aim for what the International Telecommunications fraternity have deemed as advanced broadband speeds of 25mbps with the rollout to be complete nationwide by 2019-2021 (NBN Co, 2016). A constant review of the market is conducted and comparisons are made to wireless coverage and other fixed line providers. All of which are providing DSL offerings as a rule. There is no evidence to suggest that it will return to FTTP deployment in a bid to be the standout provider.

An equivalent percentage of premises are passed in each state per year with the exception of NT and TAS. By FY2018 FTTN will surpass FTTP (based on 4.395M of 8.766M households activated). A fair and safe system for the time being.


NBN Co 2016 Corporate Plans and Reports

VDSL2 Technology and Service Activation Challenges, Andrew Long, Group Manager, EXFO 2016

Australian Bureau of Statistics

  • 3101.0 – Australian Demographic Statistics, Sep 2015
  • 6523.0 Household Income and Wealth, Australia, 2013–14
  • 201512 Internet Activity, Australia, December 2015

Roy Morgan Research finding No 6743 press release Australia, April 5th 2016

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