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  • News, Telecommunications - Written by on Tuesday, April 15, 2014 12:45 - 57 Comments

    NBN Co to kill TPG rollout while Minister dithers

    NBN fibre rolling out to Blacktown

    news The National Broadband Network Company has decided to take action into its own hands to deal with TPG’s plans to deploy competitive broadband infrastructure in Australia’s cities, revealing plans this morning to accelerate its own rollout to compete with TPG ahead of any expected decision on the issue by Communications Minister Malcolm Turnbull.

    In September last year, TPG flagged plans to deploy so-called fibre to the basement infrastructure to some 500,000 apartments in major Australian capital cities, in a move which will compete directly with the new Coalition Government’s plans to conduct similar rollouts under the Coalition’s Broadband Network (CBN) rollout, formerly known as Labor’s National Broadband Network (NBN) initiative. Shortly after, Optus, Telstra and iiNet confirmed that they were investigating similar options.

    Although it is illegal for telcos to deploy infrastructure which competes directly with NBN Co’s rollout, under legislation enacted by the previous Labor Federal Government, the telcos are taking advantage of a loophole in the law which allows extensions of a certain length to existing infrastructure. All of the telcos mentioned have existing fibre infrastructure in many areas in major cities.

    NBN Co executive chairman Ziggy Switkowski told the NBN Senate Select Committee in mid-March that the FTTB rollout plans had the potential to have a “quite severe” impact on NBN Co’s finances, causing a revenue hit of up to 10 percent. In late March, TPG revealed it had already started deploying the FTTB infrastructure.

    Over the past seven months since the plans were first revealed, and despite the fact that the TPG FTTB rollout has begun and that as Communications Minister he has direct responsibility for setting and administering telecommunications law in Australia, Turnbull has repeatedly refused to say whether TPG’s rollout breaks the law or not.

    Shortly after the FTTB plans were revealed, Turnbull appeared to call the legality of the planned FTTB rollouts into question, adding that the issue would be examined by the Panel of Experts conducting a cost/benefit analysis of broadband and associated regulation (the Vertigan Review). The review is not expected to be delivered until later this year.

    This morning NBN Co’s new chief executive, Bill Morrow, revealed plans to take matters into his own hands on the issue.

    In a statement, NBN Co said it would “bring forward” its rollout of broadband to apartments and office buildings in Australia’s inner cities, in what the company termed a “commercial response” to emerging competition in those areas from “vertically integrated telecommunications carriers”.

    bill-morrow-vodafone

    NBN Co explicitly listed target areas which TPG had already planned to cover with its rollout, such as Haymarket in Sydney, New Farm and Fortitude Valley in Brisbane and South Melbourne, with NBN services scheduled to be available to these premises in the middle of 2014.

    NBN Co said it was concerned that rollouts of the type planned by TPG may require building owners to agree to exclusive supply arrangements and thereby limit competition at the retail level.

    NBN Co Chief Executive Officer Bill Morrow said: “The NBN levels the playing field for Australian telecommunications and creates real and vibrant competition. We can make this statement because the NBN doesn’t sell directly to consumers and is open to all retail service providers to use on equal terms.”

    “Vertically-integrated carriers – companies that both own networks and market to consumers – cannot offer those same guarantees. A building that signs up to TPG runs the risk of being left with only one retail service provider – TPG itself. We believe NBN represents the superior solution for building owners and the families and businesses they house. There are 44 retail service providers operating over the NBN, representing more than 90 per cent of the retail broadband market.”

    Morrow pointed out that NBN Co’s concerns had been echoed by others in the Australian telecommunications industry.

    A survey of industry participants by Communications Day found that 47 per cent of respondents were opposed to TPG’s plans to offer Fibre to the Basement to apartments; 20 per cent said TPG should structurally separate its network arm; and another 20 per cent said it should offer wholesale access on reasonable terms. Just 13 per cent said TPG should be allowed to exclusively offer its own services over its planned FTTB deployment.

    “The verdict is clear,” Morrow said. “The NBN offers a once-in-a-lifetime opportunity to allow competition in Australian telecommunications to flourish. A clear majority of the industry is opposed TPG’s plans or wants the firm to be subject to competition constraints.”

    opinion/analysis
    I couldn’t help but laugh out loud when I read this media release, given the absurdity of the situation.

    Think about it for a second. Here we have a major Australian corporation in the form of TPG which has decided to go ahead with its own broadband infrastructure rollout, because it sees a market opportunity to make money and it’s tired of waiting for the Government to get its own broadband project organised. The private sector is trying to provide what the Government has taken too long to get to.

    So what does the Government-owned body responsible for broadband development do? Why, act quickly to squash competition from the private sector, claiming that it is delivering a “commercial response” to TPG’s efforts. Hilarious! And, of course, the icing on the cake is that the current Federal Government is a Coalition Government, which is supposed to be supportive of big business and the private sector. Instead, it’s squashing private sector competition like a bug!

    The parallels between this situation and Telstra’s move to follow Optus’ HFC cable rollout down every street in the late 1990’s and early 2000’s are also quite amusing.

    But in all seriousness, folks, what we are seeing here is actually a highly engineered “solution” to the quandary which has been plaguing Turnbull for the past few months.

    Regular readers will be aware that the Minister has been in a bind ever since TPG announced its FTTB plans. On the one hand, there is the need to maintain NBN Co’s financial viability. Despite Turnbull stating on Lateline that the NBN project is “not a commercial project”, it is very much apparent that the Coalition Government needs to maintain it as such, or risk the money that it is investing in NBN Co coming home to roost on its balance sheet. NBN Co also needs to maintain its commercial nature in order to pursue its cross-subsidy model, where profitable city dwellers subsidise infrastructure in the bush.

    On the other hand, of course, and as I have pointed out, TPG’s FTTB rollout is very real, it is here now, and customers are being signed up. Turnbull has personally stated many times that he is in favour of private sector investment in the telco industry, and it remains true that TPG’s rollout (and, potentially those of Telstra, Optus and iiNet) will deliver faster broadband to many Australians in city areas quicker than NBN Co will be able to.

    It would be highly unsightly for a Coalition Communications Minister to block private sector telco infrastructure rollouts to protect a government monopoly.

    What we’re seeing here is a solution cooked by by Morrow and Turnbull to deal with the situation. Turnbull lets Morrow announce a “commercial” response to TPG’s rollout, thus giving the Minister the ability to claim that the industry and NBN Co are sorting out their own problems themselves and wash his hands of the matter without actually making a decision on it. Morrow gets to do what NBN Co should be doing anyway — accelerating its rollout as much as possible, especially in metro areas where demand is high for his company’s services and where NBN Co can quickly pull in profits that will pump up its finances and make it look good during those new quarterly financial results sessions.

    There are, of course, quite a few problems with this.

    Firstly, what we’re seeing here is still a Coalition Government squashing market competition and private sector investment. That’s unsightly by anyone’s measure and I suspect it will come back to bite Turnbull with his Cabinet colleagues, especially Treasurer Joe Hockey.

    Secondly, TPG may call NBN Co’s bluff and go ahead with its rollout anyway. If it does, and I believe it will, I anticipate that NBN Co and TPG may end up in court or before the ACCC, where their respective rollouts and building access terms will eventually be settled. We’ve seen this before with companies like Telstra and iiNet. And it won’t end nicely.

    And lastly, of course, you do have to wonder whether what Morrow is saying is the purest hype. NBN Co has failed abysmally at accelerating its rollout over the past several years. Does the company actually have the construction capacity to accelerate its metro deployment and get more fibre in Australia’s built-up areas as quickly as Morrow says it can? Don’t forget, after all, this executive, while highly capable, has only been on board at NBN Co for a week. I suspect he’s in for a very sharp learning curve about just how slowly NBN Co does things.

    Morrow has just made the dire mistake of placing a date (mid-2014) on NBN Co’s rollout in the areas of Haymarket, Fortitude Valley and South Melbourne. You can bet I’ll be giving NBN Co a call in a few months to see whether it has actually delivered on that promise in those areas. Based on past performance, I suspect it won’t be able to get its rollout done in time.

    As a final thought, you do have to wonder what technology NBN Co will use to target the areas TPG wants to target. These areas will very definitely be inside the HFC cable footprint, which means they should technically get HFC extensions. However, NBN Co isn’t slated to get access to the HFC cable networks for an anticipated year or more. Does this mean NBN Co will overbuild its own infrastructure in some metro areas, just to compete with TPG? It’s a fascinating question, isn’t it? :)

    Image credit: NBN Co, Vodafone

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    57 Comments

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    1. Posted 15/04/2014 at 12:57 pm | Permalink |

      Haha, what happened to… “industry hasn’t the capacity to absorb [70,000 premises] at this point in time” mentioned at the Select Senate Committee Hearing?

      > we sought and have received approval to continue the process for up to a further 70,000 a month, depending on the capacity. We are not utilising that, because industry hasn’t the capacity to absorb that at this point in time.

      I guess if NBN Co wants to find capacity, it can. Otherwise, it’s snails pace and no-ramp up for the “non-preferred” technology type.

    2. JC
      Posted 15/04/2014 at 12:58 pm | Permalink |

      I’m still wondering what the mean speeds for a FTTB system are going to be like. We’ve only seen peak speeds released so far by Telstra in their trials… and no advice as to whether those peak speeds were for first floor residents or 20th floor. I suspect that those on the 20th floor will not have a great experience… ;)

      • Damien
        Posted 15/04/2014 at 9:16 pm | Permalink |

        Unless they’re more than a few hundred meters from the equipment then their speeds should be pretty good. And apart from perhaps space and access to electricity there would be nothing to stop an FTTB provider from installing equipment in a comms cabinet on a higher floor, if distance does become a problem. Regardless, I’m pretty sure someone with FTTB (living on any floor) is going to have a much better experience than someone at the edge of and FTTN zone, or an overcrowded HFC Loop.

      • William
        Posted 15/04/2014 at 10:07 pm | Permalink |

        Don’t think speed will differs much between the floors. You are looking at a distance of less than 100m.

    3. TJW
      Posted 15/04/2014 at 1:05 pm | Permalink |

      What a farce. Every day something else seems to go spectacularly badly wrong at NBN Co and Turnbull’s office.

      How can NBN Co even build FTTB when they don’t yet have access to Telstra’s copper network? I mean, does the fact that the copper’s inside the building mean that they don’t HAVE to get access to the CAN? If so, why didn’t they just do that from the beginning? Rollout FTTB first, then upgrade it to FTTP later when more brownfield sites were completed. That way they could expand their footprint, keep costs down, and accelerate the rollout all at once.

      Put me on the planning team chief! I’m ready!

      • Bryn
        Posted 15/04/2014 at 1:34 pm | Permalink |

        Yes- its different. In building copper from an MDF to the apartment is not owned by Telstra, its owned by the apartment complex/body corporate.

        • TJW
          Posted 15/04/2014 at 1:40 pm | Permalink |

          Ah that makes sense then. Thanks for clearing that up for me.

    4. Jarrod CL
      Posted 15/04/2014 at 1:08 pm | Permalink |

      “It’s a fascinating question, isn’t it? :)”

      It’s depressing, that’s what it is. I struck up a conversation with a random person in a Taxi rank yesterday afternoon in Singapore, and he wanted my opinion on whether he should opt for the 300, 400 or 1Gb service. And what are we doing? We’re busy arguing and trying our damnedest to hamstring efforts to deliver an inferior service. Well done, Australia. Well done.

      • Posted 15/04/2014 at 1:09 pm | Permalink |

        May be time to move to Singers. I do love it up there!

        • Abel Adamski
          Posted 15/04/2014 at 6:43 pm | Permalink |

          Not completely silly.
          Many UK retirees are opting for Thailand, they too have far better broadband infrastructure than we will end up with, the nationals are friendly to Westerners, low cost of living and some affordable yet absolutely first class medical facilities and specialists. The Aussie health fund NIB is expanding its options into Thai facities, not just for cost, but also the unrivalled excellence and short waiting lists

      • GENIII
        Posted 15/04/2014 at 2:57 pm | Permalink |

        “..my opinion on whether he should opt for the 300, 400 or 1Gb service”

        Poor barstard…

        I can only dream of aussies having such a problem to dwell on. Unfortunately i won’t see it in my lifetime.

    5. Renny
      Posted 15/04/2014 at 1:12 pm | Permalink |

      In such a Regulatory vacuum, NBN’s only “commercial” response can be to fast track rollout. As you correctly point out, NBN has no track record in being able to do any such thing. Add to this, that the areas being targetted are re-pleat with HFC or decent ADSL options and the whole policy of first fixing the areas with little or no bandwidth goes out the window before we have even seen a roll out map.

      As a taxpayer, I resent the fact that my money is being used to cripple private sector initiative (as overdue as that may be) rather than fulfilling the pursuitt of community service obligations which are at the core of the whole premise of the NBN.

    6. edd
      Posted 15/04/2014 at 1:19 pm | Permalink |

      Malcolm now has the situation where he must stop the private sector from cherry picking… and stopping the private sector from doing anything goes against the ideology of the Libs.
      Damned if they do… damned if they don’t.
      What an absolute debacle this project has become in the last 7 months since they took power.
      What a bunch of muppets.

    7. Soth
      Posted 15/04/2014 at 1:20 pm | Permalink |

      “Morrow has just made the dire mistake of placing a date (mid-2014) on NBN Co’s rollout in the areas of Haymarket, Fortitude Valley and South Melbourne”
      Haw haw yeah right.
      Hey umm NBN Co.. TPG is installing FTTH to my house.. Better umm beat them to it hey.. Chop chop.

    8. Paul Grenfell
      Posted 15/04/2014 at 1:22 pm | Permalink |

      What a mess, what a mess, oh what a mess it is…

    9. David
      Posted 15/04/2014 at 1:28 pm | Permalink |

      This to me looks like a classic example of FUD – Fear, Uncertainty, and Doubt. NBN Co is trying to head off TPG at the pass, and stop others from trying to do the same thing with nothing more than a press release.

    10. Scarytas
      Posted 15/04/2014 at 1:28 pm | Permalink |

      Surely this whole NBN / Turnbull / Ziggy / Morrow + Senates Estimates is nothing more than crowdsourcing a script for a new comedy series.

      • nobody
        Posted 15/04/2014 at 1:53 pm | Permalink |

        It’s not a comedy. It’s more like a Shakespeare tragedy, full of plot twists.

        • Seano
          Posted 15/04/2014 at 6:31 pm | Permalink |

          No, more like the rantings from a million monkeys at a million typewriters. So many holes in the plot, so many illogical about faces, the left hand doesn’t know what the right is doing , nor arse from elbow :) You guys can pick which character is which body part…

      • damien
        Posted 16/04/2014 at 1:34 pm | Permalink |

        I can totally see the original cast of “Yes (Prime)Minister” doing a superlative job with this kind of material!

    11. RocK_M
      Posted 15/04/2014 at 1:29 pm | Permalink |

      The delicious irony would be much more amusing if it wasn’t for the fact that billions of tax money and australia’s telecom infrastructure was the casualty…

      My 2 cents though?

      It’s a win-win for TPG actually because there’s a significant difference between the NBNCo vs TPG and the olde Telstra vs Optus affair. The latter was a pure private company vs private company competition match. NBNCo is a government owned business… either TPG gains money from it’s own FTTB roll-outs (cannibalising off the NBNCo customers) but if it can prove that it’s investment was undercut by the NBNCo roll out they are actually entitled for a compensation pay out from the government from lost income from a government owned business decision/construction (it’s the reason why the Railway line in Sydney is a complete joke). Either way TPG gets money and either the NBNCo or the Government looses.

    12. David Heseltine
      Posted 15/04/2014 at 1:33 pm | Permalink |

      So add to the list of lies the promise that the coalition would force NBNCo to target areas of poor broadband first. All because they have backed themselves into a corner with their private sector fondness and won’t simply go out and change legislation or take TPG to court to stop their rollout. There will now be a race to rollout FTTB in inner city areas of our capitals. Areas that either have cable or in most cases far better adsl connections. And the financial viability of the NBN continues to go down the drain.

    13. ferretzor
      Posted 15/04/2014 at 1:42 pm | Permalink |

      So inner city areas are slated to get nbnco fibre, tpg fibre, and hfc. Bet the nationals are loving seeing city folk get 3 networks built on top of each other, highlighting the need to roll out to underserviced areas first.

    14. Dylan Lindgren
      Posted 15/04/2014 at 1:52 pm | Permalink |

      As a Pyrmont resident this is good news for me.

      As an Australian, this is a disgrace.

    15. Kevin Cobley
      Posted 15/04/2014 at 2:49 pm | Permalink |

      It’s easy to criticise NBN in opposition, when the installation progress was slow and the punters were all anxiously awaiting their NBN connections and jumping up and down insisting on daily progress reports and continually hammering the slow progress of NBN Co.

      Labor’s NBN Co suffered from poor planning and failure to make more pragmatic installation decisions. Some of those decisions were political in nature specifically the priority given to rural areas. They didn’t care a lot for the NBN and would have preferred bigger produce subsidies and drought handouts.

      NBN was always going to have slow initial planning and slow installation, this scale of project not ever being done before in Australia.There was no trained labour force and problems like asbestos kept popping up. It was always going to take many years for the installation speeds to ramp up.

      Now we’ve got Mr Flawedband and his Notional Fraudband Network, he doesn’t know what to do. TPG (and the others will follow) wanting to install competitive private enterprise networks, to quickly out manoeuvre NFN Co. Flawedband’s NFN co will end as an on budget money sinkhole if he allows “private enterprise”.Private Enterprise is the coalition’s holy writ.

      In the end all the rollouts will end it’s zero sum game of customers where only one network can be profitable. With multiple rollouts everybody looses, when everybody looses the money disappears quickly all rollouts stop and go no further. It’s been tried before we all know what happened so why is this fool Flawedband not standing up like a man and facing the issue instead of continually engaging in media doublespeak and spinman spiels.

      • JasonK
        Posted 15/04/2014 at 5:16 pm | Permalink |

        Sorry Kevin but priority was never given to rural areas eg. Armidale is the only town in “Rural” NSW that had almost complete fibre there are only 1 or 2 town that may have a block or 2 done atm. Toowoomba is the only “Rural” Qld town with part fibre.

        You will notice every rural town which I wished they used a different color instead of a different shade have wireless installed for areas out side of the town.

        • Ben Zemm
          Posted 15/04/2014 at 11:33 pm | Permalink |

          Toowoomba was also one of the first areas to get ADSL: I had friends on it in 1999 (I remember seeing them on IRC with a .bigpond.net.au reverse DNS; Big Pond dialup used .tmns.net.au IMSMR) but I lived out of town until 2002, stuck on 33.6k. Since it was CountryWide and had good quality copper I got full speed 8160/384kbps when “up to 8Mbps” was released in 2006. (Now I’ve moved to Brisbane my “up to 20Mbps ADSL2+” connects at about 6000/500 (depending on amount of recent rainfall) albeit cheaper).

          Toowoomba is often used as a testing ground because it is a mix of city and country. It is the gateway between SEQ and SWQ. AFAICT a lot of the area covered was a RIM hell, like the far north-east corner and far south. Of course with this kind of infrastructure it will also get places with existing decent connections. No HFC. Not a lot of aerial deployments. However, they are still missing the area around the uni which was the worst for NI-RIMs.

          If Norway can get a tiny place that doesn’t even have roads FTTP why can’t we provide it to 90+% of our population who actually live near each other? http://m.asia.wsj.com/articles/SB10001424052702303325204579467542262163298?mod=trending_now_2&mobile=y

    16. blakhawk
      Posted 15/04/2014 at 2:57 pm | Permalink |

      Glad you got over your writers block Renai.

      • Cam
        Posted 15/04/2014 at 4:20 pm | Permalink |

        They do make it rather easy for him…

        • Seano
          Posted 15/04/2014 at 6:36 pm | Permalink |

          It’s like shooting fish in a barrel. Though I think Renai’s “block” was knowing which barrel to look in on which particular day, the policies/decisions could/are in all sorts of weird places, and they change on a seeming whim.

    17. Ed
      Posted 15/04/2014 at 5:04 pm | Permalink |

      “…what technology NBN Co will use to target the areas TPG wants to target. These areas will very definitely be inside the HFC cable footprint…”

      Not correct, you can use the MyBroadband website to see that places like Haymarket are a HFC blackspot. Furthermore, logic dictates that if he wants to roll out quickly, he needs to go FTTB, as the core issue with HFC is the same as FTTH – the in-building works take time, few MDUs have HFC coax, and it can be hard to retrofit.
      It would be nice if NBN managed FTTH in these buildings, that would compete properly with TPG who could likely undercut the prices of NBN…. perhaps they may do so in commercial buildings.

      Even NBN may be slower than TPG to deploy, as they have neither the local back-haul, or the negotiation, design or experience with FTTB that TPG have been developing.

      • SimonB15
        Posted 15/04/2014 at 9:57 pm | Permalink |

        Haymarket might currently be a HFC blackspot, but NBN Co have been clear that their intention is to fill in the HFC blackspots with more HFC. This is prudent because if they now approach Haymarket with FTTB they are effectively admitting that HFC is a slow, expensive dead end and acknowledging that infrastructure based competition will provide a better technical solution for residents. That said, if NBN Co are going to challenge TPG, they have no choice other than FTTB or FTTH because they don’t own/have access to either the HFC or the Telstra-owned copper up to the boundary. It will be very interesting to see how it plays out and the public response.

    18. Abel Adamski
      Posted 15/04/2014 at 7:11 pm | Permalink |

      TPG and other private sector providers already are streets ahead, they already have fibre in the vicinity (which could have been used at any time prior to the NBN), NBN has to get fibre to the premises and the active Fan/POI to connect to.
      TPG has been preparing their own plans and infrastructure since an Abbot Government became probable

    19. Howard
      Posted 15/04/2014 at 7:13 pm | Permalink |

      So I suppose this means as a home owner I can expect the fraud band to take even longer to reach me, because all priority will now be aimed at FTTB installs.
      It’s not just the country people who will miss out.

    20. Observer
      Posted 15/04/2014 at 7:28 pm | Permalink |

      This is like a really bad soap opera. Patiently waiting to see where it will end up.

    21. Karl
      Posted 15/04/2014 at 7:29 pm | Permalink |

      “I anticipate that NBN Co and TPG may end up in court”
      The day a coalition government sues the private sector for investing in infrastructure will be a very amusing day indeed – at least, it will be for those of us who don’t vote for them. That’ll be the day that even the rusted-on Liberal voters will see how far the gap is between what the Liberals say and what they do.

    22. Alex (NBN)
      Posted 15/04/2014 at 8:44 pm | Permalink |

      So I’ll ask again.

      If they aren’t politically blinded…

      Where are all the former NBN naysayers now? You know, the ones who were against the FttP network and promoted the then oppositions plan (regardless of what it was – lol) because err, umm the alternative would promote network competition and of course, have a CBA carried out..

      Hmm?

    23. guest
      Posted 15/04/2014 at 9:15 pm | Permalink |

      if I was in a building and had a choice of tpg or nbnco, I would kick tpg to the kerb. in the nuts.
      id imagine most body corporates would be of similar thinking.

      • Ben Zemm
        Posted 15/04/2014 at 11:39 pm | Permalink |

        But if TPG could provide high speed today and NBNco could provide it “sooner faster cheaper (‘non-core’ promise)” which would you really choose? Especially since Turnbull appears even less organised at actually building something than Conroy!

        TPG isn’t all bad. They aren’t all “good” either, but they aren’t all bad.

    24. Wok
      Posted 15/04/2014 at 9:56 pm | Permalink |

      Typical Turnbull – he can’t have it both ways. He has backed himself into a tiny corner & is screwed whichever way he moves.

      Not a single person, business, company or Australia is going to be a winner in this s_itfight of a telecommunications policy the Libs are shovelling down our throats with not a care in the world for what is the best for not only my future, but my children’s future & their children’s future.

      This will take a very, very, very long time to be fixed meanwhile rest of the world move forward while we head backwards downhill at an astonishing rate. In fact we may never catch up !!!

    25. Pache
      Posted 16/04/2014 at 7:42 am | Permalink |

      NBN Co was always going to do this.

      It was just a question of how & when.

      So making the announcement is an interesting indication of their response & all, but it’s the final paragraph of the opinion that raises the most serious questions.

      Are they prepared to throw the approach Turnbull has approved out the window, if they’re responding to a commercial threat?

    26. 1984
      Posted 16/04/2014 at 7:43 am | Permalink |

      Does no one here work in a telco???

      1. TPG bought AAPT which already had hundreds, if not thousands of fibre connected NTU in the basement of buildings across all of the capital cities,

      2. PowerTel, owned by AAPT, has an exclusive with EA (and other power suppliers) to supply fibre via EA conduits. This means that to deliver fibre to a building, the last mile, all they have to do is stuff it down a conduit as opposed to digging a trench at $10k per metre.

      3. I guarantee David Toeh will sell this FTTB to the government. Just like how NBN bought Transact and Telstra/Optus HFC. David will play the media for awhile whilst they activate the sites but believe when i say that there is no “rollout” going on, this fibre has been there for almost a decade!

      All Toeh is doing is offering the product to consumers. All thta’s been created is a product in a system (rates, provisioning rules and processes etc).

      See AAPT (All About PowerTel) had a significant business selling overpriced Ethernet (aggregate & point-to-point) to corporate and wholesale customers via these NTU’s. They had no interest selling to consumers having dumped that part of their business away many years ago.

      They were making insane margin of this selling every component (this services weren’t even connected to a gateway for general internet access, that was an additional fee).

      With the advent of the NBN selling to consumers meant competing in the retail & wholesale markets at the NBN set price point isn’t particular attractive, especially the wholesale rate.

      Seriously $20 CRC per mbps plus whatever it is for the tail means that TPG probably wouldn’t have any buyers unless they were at a similar level.

      At a retail level TPG will have to sell the service at a rate which competes with the NBN’s reseller’s retail rates (approx $50-$120 depending on quota’s). That said even with AAPT’s IP network, along with PIPE’s legacy infrastructure the real question is can they offer a reasonable product at a reasonable rate.

      I don’t think so. With the greedy Toeh at the helm and his massive contention ratio for existing customers I’d dare say he’ll offer this product at a ridiculous low price point and in turn dial up the contention ratio.

      Once he hits a certain scale he’ll sell to the government expecting 6-10 times what he paid.

      and the sad thing about this is the NBN will do it in order to meet the outrageous promise the government has made.

    27. Brad Cann
      Posted 16/04/2014 at 9:24 am | Permalink |

      How can people not see that this is turnbull’s action THROUGH the NBNCO, so he can save face. If Turnbull came right out and said “I don’t want private competition” to the NBN, he’d be lambasted for generations to come and so would the liberals. Instead he taps his right hand man in NBNCO and says I’m in a tight spot, publically I can’t say this, so can you do it for me.

    28. tinman.au
      Posted 16/04/2014 at 10:56 am | Permalink |

      ” Does this mean NBN Co will overbuild its own infrastructure in some metro areas, just to compete with TPG? It’s a fascinating question, isn’t it? :)”

      Indeed it is Renai. This whole thing becomes more and more “Alice in Wonderland” by the day, wonder what Queen Malcolms next move will be??

    29. MikeK
      Posted 16/04/2014 at 11:08 am | Permalink |

      BUT….. what does NBN Co do if TPG decide to roll out FTTB in areas that according to NBN Co will only be getting HCF.

      • Brendan
        Posted 16/04/2014 at 11:38 am | Permalink |

        I would presume this is exactly TPGs reason for doing.

        Because to respond to the threat, NBNco has to deploy into an area it was not; given Turnbull’s policy precludes this – it sets up a specific scenario that falls outside of policy.

        TPG is playing the infrastructure deployment equivalent of “chicken”.

        As much as I don’t like the idea of infrastructure competition (creates overbuild and drought areas) – if it forces NBNco to react and adapt it’s build to ensure a larger percentage of the population recieves FTTB, then bravo.

        They are forcing an outcome from the Minister – which is long overdue. And this is not something he can just hang on Labor.

        This is Turnbull’s policy now. Time to face the music, Minister.

    30. Brendan
      Posted 16/04/2014 at 11:17 am | Permalink |

      Actually if NBNco attempt to act in an non-competitive manor, TPG could raise a valid complaint via the ACCC. Having said that, there is one thing that will cause even the recalcitrant Ziggy to snap to attention.

      Loss of profit.

      NBNco has never had a direct commercial threat (apart from Telstra & Optus HFC networks, which are walled gardens with little/ no growth) and has never really needed to respond to actual competition. It was all but legislated out of existence.

      Turnbull can make (or not make) noises but ultimately NBNco has a charter and it has deliverables. A commercial threat will wake the sleeping giant and could kick off the next great race as it fights to hit the ground first.

      That will no doubt make one hell of a mess of deployment maps – good thing they’ve been scrapped in favour of need-to-know.

    31. Nich
      Posted 16/04/2014 at 1:48 pm | Permalink |

      It’s pretty simple. ACCC/Turnbull just makes sure any publicly available fibre-derived broadband has to be open-access at the wholesale level.

      TPG wants to pay up and install hardware? Then it’ll be PIPE making a slightly increased profit, but probably with regulated pricing levels it can offer to retail.

      • Brendan
        Posted 16/04/2014 at 2:32 pm | Permalink |

        The ACCC see direct infrastructure competition as optimal.

        In much the same was as HFC isn’t regulated and doesn’t have wholesale a requirement, ACCC may not require TPG to do so either.

        If TPG resist providing wholesale, then it’s down to the ACCC to police; Turnbull has already made it clear he will not take responsibility (for anything) and will leave it to others to resolve.

        The ACCC view and Turnbull’s views on regulation and operational matters, are not the same.

    32. Tailgator
      Posted 16/04/2014 at 5:20 pm | Permalink |

      The Govt, Turnbull, and the lackeys at NBNCo are attempting to re-frame the issue as one of commercial competitiveness. This is completely at odds with the initial intention of the NBN and comes with an inbuilt guarantee of the demise of the NBN and NBNCo.

      Mission accomplished. Destroy the NBN

    33. Tailgator
      Posted 16/04/2014 at 5:24 pm | Permalink |

      Renai, you are being suckered.

      Who is setting the agenda and for what purpose?

    34. amazed
      Posted 21/04/2014 at 11:13 pm | Permalink |

      Australians have become accustomed to accepting the lies told by many of our corrupt politicians. We seem also to not ask the right questions in response! What about the core issues here? Who is funding this defective project? The taxpayer! It is a money laundering scheme designed for those at the top of the tree to distribute tax-collected funds to each other. Period.

      I expect that the NBN project will not achieve its objectives. Its been 5 years already and we have made no real advancements. Good on tpg for seizing the opportunity.

      Shame on the Australian tax payer for accepting this and for allowing themselves to be so easily distracted. Its good the royals came out when they did…only another $2M…

    35. Ronald E
      Posted 29/04/2014 at 10:46 am | Permalink |

      NBN Co is a farcical disaster. Conroy was a dud.

    36. chris
      Posted 17/06/2014 at 7:05 am | Permalink |

      Love to see a update for this on the current situation given it is half way though 2014 and no NBN in sight in southbank Victoria but TPG are saying they should have an announcement for my apartment block in the next few months.




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