Customers dumping fibre for 4G in Japan


The following opinion/analysis piece is by Tony Brown (Twitter), a senior analyst with Informa Telecoms & Media. It originally appeared on Brown’s blog and is replicated here with his permission.

analysis Here in Australia the debate over the A$37 billion FTTH National Broadband Network (NBN) has been as bitter and partisan as anything I have seen in my 15 years living down under, at times it has made debates over traditional hot-button issues like abortion and gay marriage seem like tea and biscuits with the local Vicar.

As an analyst one of the most frequently asked questions I have received from mainstream journalists during the NBN debate is, “Why do we need the NBN anyway, why can’t we just do it with wireless?” Indeed, I once appeared on a Melbourne AM radio station with a well-known conservative-leaning host to answer this very question, this required a lengthy explanation that going all-wireless would not be possible because of spectrum constraints and that fixed-broadband networks were irreplaceable. I haven’t been invited back.

Nonetheless, the suspicion still lingers in conservative circles that something is not quite kosher, the booming device eco-system of smart-phones and Tablets convincing many of them that “wireless is the future” and that the boring, expensive fixed-broadband NBN was a scandalous waste of money from a profligate, socialist (if not downright communist) government.

That’s Tokyo calling …
Although the fact remains that wireless networks – even the greatly hyped newcomer LTE – can’t carry the weight of demand for bandwidth from subscribers, there is now serious evidence emerging that the arrival of high-speed LTE networks coupled with the Smartphone and Tablet boom is creating serious problems for FTTH operators in some markets.

The best example of this is coming from Japan where fixed-broadband giants NTT East and NTT West have been forced to slash their FTTH prices for new subscribers by an eye-watering 34% from ¥5,460 (US$66.70) to ¥3,600 per month to try and re-ignite their subscriber growth and stop the outflow of subscribers to cheaper LTE mobile broadband services.

Sister-company NTT DoCoMo launched its initial LTE services back in December 2010, with rivals KDDI, Softbank and eAccess launching only this year, with DoCoMo’s LTE subscribers growing rapidly to hit 6.2 million at end-September – despite the embryonic nature of the LTE device eco-system and the fact that LTE has only recently reached mature network coverage.

At the same time though NTT East and NTT West’s FTTH subscriber growth has significantly slowed down – despite the fact that overall national FTTH household penetration was still just 46% at 2Q12 – with the firms’ combined net subscriber adds for the year to end-June 2012 falling to 1.2 million, down from 1.7 million in the year to end-June 2011 and from 2 million in the year to June 2010.

Those figures tell a worrying story for NTT, which has spent a huge amount on deploying its nationwide FTTH infrastructure but now sees FTTH subscriber growth slowing markedly across the board, with rival FTTH firms also seeing similar slowdowns in their own FTTH subscriber take-up – hence the whopping 34% price cut.

A changing landscape
The irony of slowing FTTH subscriber growth in Japan and the rise of LTE is that it comes at a time when DoCoMo has actually significantly rationalised its mobile broadband pricing, sweeping away the old all-you-can-eat era with a cheapest price of ¥4,935 (US$60) per month for just 3GB of data – albeit at potential super-fast LTE download speeds of 75Mbps.

Sources at NTT East and NTT West are unequivocal in their views that the biggest, single reason for the slowdown in FTTH subscriber growth is the fact that many young subscribers now prefer to have their own ‘personalised’ LTE broadband services rather than paying for a household-based FTTH service – in addition to which they would be paying for a Smartphone LTE data plan anyway.

Initially, many at NTT East and NTT West were convinced that fixed-mobile broadband replacement in the LTE era would be relatively limited because of the fact that mobile broadband would not provide a sufficient data allowance for subscribers to watch movies, download music etc. – but that assumption is proving somewhat flawed.

Sources at NTT East say that LTE subscribers seem to be adjusting their behaviour to fit with the realities of mobile broadband and that they are ‘snacking’ on video-clips and music on their Smartphones and Tablets rather than downloading multiple HD movies and engaging in the sort of behaviour they would on an FTTH connection.

Of course, operators would ideally like subscribers to take both mobile and fixed-broadband and although NTT East and NTT West are not allowed to bundle their FTTH services alongside DoCoMo’s mobile services, second-ranked player KDDI is aggressively bundling its Smartphone plans with its FTTH services.

A rational conclusion
None of this evidence from Japan means that fixed-broadband is dead and we can all live in an LTE utopia – although some partisans might decide to make that their main conclusion – but it does show that once LTE becomes available on a national scale then it has the ability to make a significant impression in the broadband marketplace.

Moreover, although more hard evidence is required on this issue, we can also start to see that LTE subscribers – aware of the limited data allowance they have available – actually use LTE very differently to how they use a FTTH connection with its unlimited data allowance.

From what we can see Japan’s LTE subscribers are becoming more sophisticated in their understanding of the value of mobile data and are increasingly prepared to trade the unlimited data allowances available on FTTH for the mobility and cheaper price of LTE – despite much smaller data allowances.

Of course, when Japan’s LTE networks start getting more congested we might see some of the FTTH ‘refuseniks’ come back to the fold and FTTH take-up might begin to rise again – but that is no sure bet, especially if operators manage to make Wi-Fi offloading seamless and therefore reduce LTE traffic congestion in high demand network areas. Clearly, fixed-broadband networks aren’t going anywhere but if the Japanese experience is anything to go by LTE could take a much larger seat at the broadband table than we had first imagined.


  1. One of my associate engineers is in Japan at the minute on work refitting 3G sites with extra LTE capacity. He’s said that there will be no way they can keep up with the growth they’re seeing.

    It’ll end up as congested as their 3G networks in a really short time frame.

    Then everyone will swap back.

    • Thats what everyone forgets…… 3G network use to be ‘fast’ when it was new, then everyone piled onto it and its slowed down. LTE aka 4G is the same. The network is EMPTY, so of course a empty network is going to be fast and zippy. Wait till everyone piles onto the LTE network and starts to hammer it, then you will see what happens to the LTE speeds as a FTTH replacement option.

    • So they’re building a new road, that will get them to their destination twice as fast, and then inviting everyone to use it.

      I wonder what the reaction will be to the traffic jam…

    • Wireless technology is not standing still. We now have LTE where there was only 3G and technology advances that provide more bandwidth will continue. I accept though that due to the massive explosion in mobile data usage it needs to advance pretty quickly to keep up, but so far it (arguably) has.

      • I’m glad you said “arguably” cause you’re wrong. Try using a 3G device in a CBD between 11am and 3pm. IMPOSSIBRU! Even my 4G experience has deteriorated drastically since it launched. I was on T4G from week one and my speeds have gone from >40mb to <10mb (speedtest @ 1152 today netted 9.72/10.59).

        Wireless tech is NOT keeping up with demand. It will always be complimentary to fixed fiber, never a replacement.

        • I totally disagree… If a city like JAPAN (and lets face it Japan’s density is like a city) can handle LTE at the moment even then I can’t see our “cities” having real problems. The new responsible data allocations are effecting this and that coupled with the new TCP management algorithms which increase throughput on weaker signals will enable even more bandwidth then is currently assumed. It’s a matter of managing the Spectrums… Telstra is not utilizing all of the available 2G spectrum as yet, which has the frequencies being farmed out to the 4G network. As more option start to emerge and the Three carriers start to be more professional in their approach to data management I think we will have no problem supplying the needs of the community with wireless… This will NOT though be the case in large business in the next decade and this is where the investment is needed TODAY! not at Bob’s house!

  2. It is worth noting that Japan is a bit behind in the whole “digital consumption” side of things. I recently read an article about it, can’t find the link right now. It said that one of the reasons is that they mostly don’t have a “living room” to lounge about in front of a TV and consume content.

    Given this constraint, it’s not surprising that many are able to cope on mobile “snack” style consumption as described in this article.

    Of course, this won’t stop the opposition from latching on to this and declaring it as yet more proof that the NBN isn’t needed. Why let little facts like the vastly different user consumption patterns here in Australia stand in the way of a good mud-slinging match.

    • The Japanese are content to use tiny tiny screens for just about everything. That said, they’ve had their Foxtel equivalent beaming round the country over Ethernet since forever.

      • Seems like a crises in product management rather than a technical one.

        how about a plan that is access point agnostic, that charges a single RC irrespectiv of the layer 1 access? Like bundling but it don’t care what you have, ftth, lte, DSL, dial….whatever.

        • “how about a plan that is access point agnostic, that charges a single RC irrespectiv of the layer 1 access? ”

          The problem with that is that layer 1 access does not cost the carrier anything like the same.

          If you want a layer 1 agnostic access, expect to pay a rate that covers the cost of the most expensive access technology.

  3. > NTT East and NTT West have been forced to slash their FTTH prices for new subscribers by an eye-watering 34% from ¥5,460 (US$66.70) to ¥3,600 per month to try and re-ignite their subscriber growth and stop the outflow of subscribers to cheaper LTE mobile broadband services.

    No. That price cut may be there, whatever, but FTTH has had its first profitable year for NTT in 2012 – it was almost profitable in 2011. The number of subscribers is growing by 2 million a year and only slightly slowing down – in fact it’s been slowing down since about 2009. ARPU (not total revenue) due to the above price cut or whatever other factors is down about 2%. FTTH is growing to 30 million across all providers by 2016 and most of this growth has come at the expense of DSL. Note in the presentation below they even say that ““mobile traffic expansion issue” would be solved by optical access.”


    > DoCoMo has actually significantly rationalised its mobile broadband pricing, sweeping away the old all-you-can-eat era with a cheapest price of ¥4,935 (US$60) per month for just 3GB of data.

    Is more like it. 4G is displacing some FTTH, it’s true, but it’s presumptuous to say that this is the cause for FTTH deployments slowing down, when it can be far better explained by FTTH reaching some saturation point.

    • Also, speaking of congestion, 1seg = lots of TV not over mobile broadband in Japan. Surely that’s got to help and so would an entry point of $60.

      • No, the mobile TV in Japan does not go over the mobile networks, it goes over specially built ‘mobile broadcast’ networks built on the local variant of DVB-H, the same as the Chinese CMMB or Korean T-DMB.

        • > built on the local variant of DVB-H

          It’s fair enough to say that all digital TV standards are fairly similar, but to say that ISDB is a mere variant of DVB-H is plain wrong.

          • Sorry, should have phrased that better.

            The technologies are obviously not related, the main point is that they are specialist mobile broadcasting technologies which send the TV broadcast over a broadcast network rather than a mobile network.

            The Japanese are using their own technology, the Koreans their own (T-DMB), the Chinese their own (CMMB) and the Europeans their own (DVB-H).

            These technologies all work fine, there are no technical issues, the problem is that there is still absolutely no business case whatsoever for mobile TV, it crashed in Korea – costing SK Telecom a fortune – and shows no real signs of life anywhere else.

  4. Its worth noting the Payback on their Towers is much faster due to Population density.
    Their hyper densely populated cities make it much cheaper and easier to use 4G,

  5. What a trolling or ignorant article.

    Comparing Australian infrastructure to Japan is like comparing a clapped out Holden Ute with bullet holes in it lying in the Outback to a Nissan GTR.

    The mainstream Japanese have been plugging their TVs into Ethernet ports since 2001.

    Japan is a country where copper infrastructure is going to look utterly immaculate compared to every other nation probably outside of Germany because the vast Japanese workforce that exists to look after these things will be taking pride in it. I wouldn’t be surprised if they dust down their cabinets once they’ve finished a job. It represents a difference in cultural work practices so vast that you may as well compare us to martians.

    Then look at the Japanese attitude to infrastructure. Picture ours. Now turn it on its head. That’s Japan. An excuse to build a vast infrastructure project and put a zillion construction workers to work? Let’s do it! Building a bridge to a island where nobody lives? Who cares? Installing a hugely inefficient system of mobile phone infrastructure that noone in the world uses? So what! More work!

    Have you seen the population densities of Japan? Everyone using 4G? Good luck with that in a few years time!

    Is this guy trying to mislead?

  6. I’d jump on 4G as well and not worry about FTTH if it was cheaper as it’s so much more convenient to have/use.

    Just as long as the speeds stayed and didn’t drop with more people using 4G that is!

      • But, if this had any semblance to actuality, wouldn’t this just make his FttN and HFC even more redundant (if that is possible)?

        • NBNAlex it certainly would but you should know by now that is the benefit and advantage of being a hypocrite especially when there is no one in the mainstream media willing to call them out on it. Turnbull can flip-flop between many positions at his leisure and round off the rough edges with special pleading and tap dancing depending on the latest article “supporting” his position. It’s a machine gun strategy. You need it when you suck at using a sniper rifle.

  7. Interesting, I wonder if it’s purely wireless or whether there’s Wi-Fi involved?

    Plus let’s again not over look the need for fibre backhaul.

    What’s even more interesting is I believe in the US the opposite is occurring, those who have gone wireless only, are returning to fixed due to congestion.

    Thanks for bringing this to the table Renai (and Tony of course).

  8. Don’t forget that japan is a lot more dense than Oz thus we can service mobile users easier in terms of cells but we need more cells over a wider geographic area. Will be a long time before we get 4G over the whole country

    Would be nice if Foxtel lowered its tariffs!

    Meanwhile the carriers are going to milk their 3G/4G networks to the max

  9. Wait… 1.7 million new customers per year and 3 gigabyte LTE caps? … Yeah fibre is dead…

    • For sure. Who’d want FTTH when the average 30-60G user could get the same with 4G for the equivalent for $600-1200 a month.

  10. How about some details on the actual network capacity of LTE? Is it significantly more efficient in its use of spectrum over UMTS/HSDPA? I get the feeling LTE is just going to choke on the demand and become useless.

    And gosh, at $60/3GB, LTE sounds very expensive.

    • Interestingly mo, LTE is actually about as efficient in its’ spectrum usage as UMTS. 20Mhz of LTE can do 100Mbps currently. 20Mhz of HSPA can do, theoretically, 84Mbps (if you include MIMO, obviously it’s higher).

      LTE-A is going to be significantly more efficient in spectrum, with the idea being 30Mhz can do nearly 300Mbps, theoretically. None of that changes the fact that it is entirely dependent on the cell capacity as to how many people achieve these speeds.

      • You will need a multi-antenna array to get the max MIMO speed. This could be impractical for mobile, but ok for fixed wireless such as NBN Wireless (which already uses LTE and will probably use LTE-Advanced too)

  11. The article is interesting as it challenges the assumption in the NBN business plan than wireless only consumption will not be greater than 16% of premises.

    What will happen to university students living in shared house?
    What will happen to people living in rental properties?
    What will happen with people living under financial stress – internet on phone or home or both?

    • > The article is interesting as it challenges the assumption in the NBN business plan than wireless only consumption will not be greater than 16% of premises

      No it doesn’t.

    • “What will happen to university students living in shared house?”
      Do what they do now, share a fixed line with a wireless router.
      “What will happen to people living in rental properties?”
      People in rental properties do use fixed line too, they aren’t excluded.
      “What will happen with people living under financial stress – internet on phone or home or both?”
      Whatever suits them as they do now with the ADSL2 vs mobile choice.

      • It is amazing how the NBN fanboy’s jump on anything that remotely question’s its supremacy.

        Can wireless replace fixed line services for some people apparently yes. ( I personally know numerous people who only use the internet for browsing and some streaming which can all be completed off a phone / tablet).

        Can wireless replace fixed line services for everyone? Not with current technological limitations. I know personally I could not survive on wifi alone.

        Everyone is different. I am still surprised when I find people who are constantly on facebook / ebay / online shopping but cannot obtain any software online. Different interests will define people’s usage and demand.

        • Equally, it’s amusing how quick people jump onto “the next next cellular network thingo will totes replace fixed line!!!1”.

          If it ever, and I mean ever actually met that hype, most people wouldn’t be using (or trying touse) fixed line services. Thing is, it (mobile) is constantly being replaced by the next big thing. So it never really hits the price point where it can directly compete.

          Mobile connectivity is a create option for mobile people. Less so for services that really need the base load type capacity fixed line offers.

          Never mind what actually often connects those towers. Fibre.

        • It is even more amazing how the NBN doubters will desperately cling to anything, jump to conclusions and say ah ha, simply because they are unable to accept fibre’s proven supremacy.

          Then ask things like what will students, renters and strugglers do, as if the NBN is some terrible new impost…

          It’s known as life Michael and it will continue either with or without the NBN or the newest mobile claim. The students, renters and strugglers will still need to make those life decisions, as will we all.

          And yes there will be improvements in wireless, as there will be in fibre.

          And yes some people will choose wireless only. But the ABS stats have shown fixed and wireless (downloads and connections) both increasing with fixed doing all the downloading hard slog (94%).

          Once again just shows that they are complementary.

        • I am a fanboy because I answered your questions? I don’t see in the post any defence of anything.

        • Agreed. Wi fi can replace boradband for some people. I very much doubt it would cut it in a shared student house. Having a couple of uni age kids, one now living in a share house they suck down multiple hundreds of gigabytes.

          • It goes both ways,

            I know people who go through hundreds per month and others who do not know what a torrent is.

          • Oh for sure. But I would be surprised if there were many student share houses that wouldn’t use a ton of bandwidth.

    • @Michael

      Yes, there appear to be some uncharitable people here tonight on the fanboi front….

      However, a couple of things:

      What will happen to university students living in shared house?

      All of my friends at Uni a few years ago shared an ADSL connection- the were mainly Engineering and Science kids, but even so, 3G was NOWHERE near good enough, even at a city campus and the usage for price is woeful. I see no reason that will change.

      What will happen to people living in rental properties?

      This is one I can answer personally. Nothing. I’ve lived in 5 houses in 5 years. We’ve had a fixed line in all. We’d never change that. We’d be useless on 3G and we get DC-HSPA here at regularly 8Mbps, often faster than our ADSL. But the USAGE is the problem. We go through 130GB a month and none of us stream HD video regularly.

      What will happen with people living under financial stress – internet on phone or home or both?

      The same that has ALWAYS happened with these people- they will CHOOSE what is most important to them. That may very well be wireless only. But not likely for a family. More importantly, how do we REDUCE the number of people in financial stress is the more important point. And spending or not spending money on the NBN will not change that. You know this- it isn’t tax money.

      NBN’s assumption of about 16% wireless only still appears, from the evidence I have seen, to be eminently practical to work on. Do you have any evidence that shows otherwise? AFAIK, fixed line growth is STILL positive according to the ABS and relatively steady.

      • “Yes, there appear to be some uncharitable people here tonight on the fanboi front….”

        Sorry, you must be a fanboi too. You gave the exact same answer I did in a somewhat more verbose form.

      • I’m not arguing against fibre in any form, just stating that there is a strong niche for wireless which is often complementary to fibre (given the number of smartphones / tablets) and a growing market as a substitute as data plans increase for basic users. I have many friends (admittedly not that tech literate) who do not use much bandwidth. When they live out of home they do not see the point in purchasing a fixed line connection as they would also need to purchase line rental. In addition if they were at that address temporily why would they sign up to a contract when they would have to cancel it when they had to move.

        It is not exclusive in either circumstances, not all renters / shared houses will choose fixed line granted those with an appetite for broadband will definately go out of their way to arrange it (as I would) and others who do not see it as a priority may settle for wireless.

        Another interesting issue which i have not seen mentioned, is that with new LTE networks cannibalising 3G networks the 3G will eventually become less congested (granted at a lower max speed) and there will be a point when the two networks are complimentary.

        • @Michael

          When they live out of home they do not see the point in purchasing a fixed line connection as they would also need to purchase line rental.

          Isn’t it fortunate then the NBN won’t require line rental :)

          In addition if they were at that address temporily why would they sign up to a contract when they would have to cancel it when they had to move.

          They wouldn’t. There are already several cut price RSPs, including Exetel, that offer month-by-month plans. And if your premises already HAS the NBN installed (likely in rentals), it will be a matter of 2 hours to get it connected, compared to 10 days sometimes….

          Another interesting issue which i have not seen mentioned, is that with new LTE networks cannibalising 3G networks the 3G will eventually become less congested (granted at a lower max speed) and there will be a point when the two networks are complimentary.

          Mmmm, I’m very interested to see what the mobile operators do- do they keep the 3G? Or do they cannibalise equipment that is quite often backwards compatible with LTE, to increase LTE throughput in a few years once most people are on LTE?

          • I was highlighting some of the issues that prevented people I know from obtaining fixed broadband connections while at university. For others it was as simple as, they could access bandwidth at university so they did not need any at home and preferred to save the money on their internet connection but either way it’s good that things are being simplified.

            As far as 3G / 4G goes, will there be a point when it will be almost beneficial to swap back to 3G as most people will have 4G enabled so the 3G network would be relatively uncongested. Or would carriers sell 3G only plans at a discount as an alternate method?

    • What will happen to university students living in shared house?

      I’m a university students (as well as full-time work). Done shared house and solo living. Fixed broadband is a priority, always. Why? Because when I’m researching for an assignment, I’m pulling down up to maybe 40 or 50 articles (half of which are useless). Each of those is a multi-megabyte PDF file. I’m accessing databases, lecture notes, recordings (audio and video), the works. I need all of that and I need it fast. Multiply that by three or four people in the one house. Wireless broadband just isn’t an option.

      • Forgot to mention – on the NBN there can be up to 4 separate connections. So a house with four people sharing could each have their own RSP and connection.

    • What will happen to university students living in shared house?

      Judging by the direction that universities are taking to distribute course content, they all better have fat pipes and high quotas, or spent insane amount on housing within 5 minutes of the university to use on-site services. I work in IT at a university, and a colleague has just returned from a conference in US on that very issue. Australian universities are behind the US at the moment, but all heading that way to stay relevant for the future.

  12. Does this mean that, when the mobile demand increases, the telco operators will be able to push up the cost of 4G and spend that extra money on the most effective way to deal with congestion – ie. to subsidize fixed line costs to encourage more WiFi hotspots? Effectively mobile cross-subsidizing fixed line?

    This is inevitable, because consumers don’t WANT fixed line – they WANT mobile for convenience, but they NEED fixed line whether they know it or not. It’s up to their service providers to provide that service that they want – MOBILE using the most efficient and profitable way they can – ie. via fixed line and WiFi. Fixed line will be funded INDIRECTLY via mobile fees.

    • I’m happy with my fixed line internet, wouldn’t trade it for mobile at all. Especially when it took Telstra a very very large number of years to finally put up a second tower in the town to help deal with all the blackspots.

      That was great when they did that, now, it’s just as congested as the first one which is about 5km out of town.

  13. So the Japanese are adjusting their usage habits to suit wireless limited capacity – just like they adjusted to smaller living spaces and limited roads. They have tiny apartments, tiny furniture, tiny cars. Is this the future for the rest of the world. No, because it doesn’t have to be that way. Not if you link wireless and fixed line together.

    Too many people, including the author of this article think wireless and fixed line are contradictory technologies, and can’t comprehend that a NETWORK is made by joining links made from different technologies chosen to address specific issues.


  14. Mr Brown seems to have taken a somewhat narrow view here, perhaps in an attempt to try and be balanced, while showing there’s a possibility FTTH isn’t worth it…..or perhaps to try and mislead….I’m going to assume the first though to be fair.

    There’s a few interesting facts:

    – DoCoMo will have 4000 LTE towers that can do 75Mbps by the end of this year. Covering 70% of Japan’s population. Japan’s population is near enough 128 Million. That means the LTE towers cover 90 million people….or 4 times the population of Australia…..with HALF the number of towers Telstra has. Now, I’m sure this will grow, but the fact is, if everyone were to jump ship to LTE, it would become, essentially, useless. This shows in my next point…

    – NTT’s 6 Monthly results show- Expected doubling of Xi (4G LTE service) subscribers over the next year, from 6 Million to 12 Million, while experiencing a loss of FoMA (3G) services of 4 Million subscribers. (likely due to cannibalisation)

    – They also show an expected growth from 17 million to 17.8 million subscribers on FLET’s Hikari (FTTH), which is slightly above the growth in the previous year (of 500 000). As well as a growth from 14.5 Million to 15.4 Million of Hikari Denwa (FTTH + phone) subscribers, around 300 000 below the year before.

    – NTT is ALSO predicting a loss of 200 000 ADSL subscribers over the same period (likely, again, a cannibalisation)

    – ARPU of Wireless is, overall, dropping by some 300 Yen over the 2012 year (includes a rise of 200 yen in Data and a loss of 500 yen in calls). Average ARPU is around 4850Yen.

    – ARPU of Fixed Broadband is dropping about 80 yen over the 2012 year (optional packages for TV/Phone have risen slightly by 50 yen and overall monthly basic charges dropped about 100 yen) Average ARPU is about 5850Yen.

    So, what does this ACTUALLY show us?

    1- 4G is popular. No question. A DOUBLING of subscribers is impressive….but perhaps not so impressive when we realise some 60-70%% of that is likely a cannibalisation of 3G subscribers. But, even so, it definitely shows the Japanese are crying out for more speed….which isn’t surprising, considering NTT’s 3G coverage is 7.2Mbps….that’s right, they don’t even have HSDPA. And try figuring out their usage on 3G….you tell ME what a “packet” is considered a measure of, because apparently 52000 of them is alot….

    2- Fixed broadband, FTTH specifically, is still growing at a healthy rate. About 5-6% year-on-year. For a country that appears to have a HUGE slowdown in its’ economy and a broadband penetration largely akin to our own (about 65%) would indicate we’re reaching maximum penetration. The growth figures are still well above our own.

    3- ARPU on mobile services is suffering the loss of voice services quite badly (not unlike our own operators) while experiencing a growth in data ARPU, while ARPU on fixed broadband is relatively steady, down slightly on basic services, again, not surprising considering the economic state of Japan.

    As an aside, their FTTH video service is growing quite healthily and is separate from their broadband figures (though you must have FTTH to use it). It grew by 12% over the 2012 period and looks to grow another 12% over the next 12 months.

    ALL these facts seem in direct conflict to what Mr Brown has indicated- that people are dropping their fixed lines for 4G. Why? Because Mr Brown has focussed on GROWTH, not ACTUAL SUBSCRIBERS. The number of subscribers on fixed line HAS NOT GONE DOWN, it is GROWING, year-on-year. While 4G subscriptions are growing HUGELY faster, that is not surprising as we all know- you can have one or multiple 4G connections per person, while there is only one fixed line per home, usually. And WHY is 4G growing so fast? The same reason 3G grew so fast when it was coming in- convenience, speed and mobility, for a reasonable price. 4G is replacing 3G quickly- not surprising, as I said, as 3G is only 7.2Mbps on NTT. But there is NO evidence it is actually cannibalising fixed line.

    And that is why I wonder if Mr Brown is trying to mislead….

    • I also failed to note Mr Brown’s ignoring the most recent downward projection was 10%, or 150 000, not 500 000. It says that clearly in the financial report. It is not as if the addition of subscribers is dropping through the floor. It is simply declining in growth terms.

      Once again, with both the Fukishima disaster and the Tsunami that caused it, coupled with the GFC, it indicates to me the slackness in spending of the economy, not a serious downturn. Why fixed line and not mobile? Mobile has and probably always will be, considered a luxury/entertainment, while fixed line is a workhorse, or necessity. In times of downturn, people spend MORE on entertainment than on necessities, to encourage themselves. Here we appear to see that born out.

      How many teenagers do YOU know who’d drop their mobile spend to have healthier meals that cost more….?

    • @seven_tech

      Firstly, let’s hold off on the insults, I am not trying to “mislead” anyone, the facts are the facts and it is a plain fact that NTT East/West – about as conservative as you can get in corporate Japan – just cut FTTH prices by 34% for new subs (and will shortly cut for existing subs too) because of the impact LTE is having on their growth.

      Let me answer your points as best I can in the time available, firstly, you are not going to get the entire Japanese population on DoCoMo’s LTE networks, the mobile broadband load will be spread between DoCoMo, KDDI, Softbank, eAccess and UQ Communications.

      This does not mean, of course, that they will replace FTTH/HFC in any way, they will be complementary with the real question being how big a chunk of the fixed-broadband pie that LTE will take – don’t forget that UQ Communications standalone WiMAX service already has 3.5 million subscribers.

      NTT is pushing subs off 3G and onto 4G as they are charging more for 4G and they want to monetize the new network as best they can, the 3G networks are congested and LTE is DoCoMo’s USP at the moment given the advanced state of their network.

      Of course, FTTH subscribers are still increasing – they could hardly not increase given that NTT is aggressively tipping subs off of DSL and onto FTTH – the point is that the rate of FTTH take-up is slowing substantially.

      This is a serious issue given that FTTH penetration in Japan is still only 46% – compared to 71% in Hong Kong – so still has plenty of room to grow, you might expect ‘saturation’ slow down to kick in at 75% or so but certainly not at 46% HH penetration.

      Indeed, if the current FTTH net sub adds decline continues – and it well might – then they might add below 1 million subs in the year to June 2013 – they need to re-ignite growth or they will be in real trouble.

      Your point about ADSL answers itself, these subs are porting over the DSL or churning to MBB.

      As I said earlier, FTTH is still only at 46% penetration and there are now only 22.8 million FTTH subs in Japan at end-June – bear in mind that the government had targeted 30 million FTTH subs at end-2010, so they are a long way behind initial expectations.

      Fixed-broadband ARPU in Japan, especially on FTTH, must be viewed in the wider context of NTT completely locking out its rivals from the FTTH re-sale market by enforcing totally ridiculous wholesale prices.

      This is why Softbank now only ‘re-sells’ the NTT East/West FTTH services (rather than offering its own retail services on the NTT East/West networks) and why KDDI has spent fortunes on buying up cable MSO’s and FTTH operators to get its own last-mile infrastructure.

      Therefore, any fixed-broadband improvement has to be seen in the context of the fact that if you want FTTH in Japan then you are likely to be forced to go with NTT East/West as there are very few alternatives available – they control over 75% of the retail market.

      As for the ‘Hikari TV’ IPTV service offered by NTT Plala (another group subsidiary), yes, this is growing but its off a very low base, they only properly launched the service in 2010 after lots of legal issues stopped them launching properly before.

      NTT is doing IPTV because it feels it should rather than having any chance of real success, nobody has ever cracked pay TV in Japan because the FTA market is so strong and there are so many FTA channels available.

      Even Murdoch pulled out of Japan in the end, selling out of DTH firm SkyPerfecTV to Sony rather than seeing the losses mount, a couple of years back the other major US firm Liberty Global sold out of cable TV operator JCOM to KDDI.

      As I mentioned earlier, FTTH is still growing but the growth rate is slowing dramatically and the folks at NTT East/West are worried about this – believe me, I spoke to one of them today – they are very concerned that they are going to be left with an FTTH network that is under-utilised.

      Now, its quite possible of course that when Japan’s LTE networks get congested (as I say in the piece) that people will move back to FTTH and there will be a ‘correction’ in the market, we shall have to wait and see.

      But its also worth remembering that people use the Internet in different ways and not everyone wants or needs a 1Gbps or whatever FTTH connection, this does not mean that we should not build FTTH networks, it only means that we should not over-estimate the demand for these networks.

      As for your final point that there is NO evidence that LTE is cannibalizing fixed-line broadband, if you don’t want to take my word for this then perhaps you will accept that of NTT President Hiroo Unoura who, when commenting on the FTTH price-cut, said, “Young people are continuing to cancel [FTTH] due to the spread of Smartphones.”

      • @Tony Brown

        Firstly, please do not take my “misleading” comment as an insult- misleading can happen accidentally or on purpose and I was merely suggesting it could’ve been done. I apologise if it came across that way- I first read your article as retweeted by Mr Turnbull and I have an unfortunate tendency to cast a VERY sceptical eye on his links, as they are often misleading, as are the many of the Oppositions stances on the NBN overall. In this case, I have judged that incorrectly, as the article is clearly talking about FTTH as a whole, not specifically the NBN, although obviously it follows on that we may need to watch these trends, and I apologise. You appear to have a balanced view on what we have seen of commentators on the NBN in general, which is always appreciated. I am, however, sick of some commentators, both Pro and Anti, that mislead ON PURPOSE. I’m sure you know the ones I refer to…

        On your post in general- Much of the growth options Japan has appear limited by the monopoly nature of DoCoMo. I don’t know Japan’s Telecommunications history, so I can’t comment on how it compares with our own. However, you mention NTT’s “ridiculous” wholesale prices. Well, that would explain a bunch of declining growth right there, after the initial early adopters (always willing to pay more) dropped off- the competitors can’t afford to pay the wholesale and keep up ARPU. Fortunately, the NBN is highly regulated, so that is unlikely to be a problem. (assuming the government doesn’t try and make the same mistake it did with Telstra…)

        Specifically, on a few points:

        – Cutting prices on the FTTH may indicate that early adopters were willing to pay the (frankly) much higher costs of FTTH BEFORE the GFC, but “plebs” now, during normal growth, aren’t. It may also be a combination of things as well, such as the move to smartphones/tablets as many young people’s primary computing devices- I happily acknowledge that WILL be a factor. But these young people will grow up and have a family. And that family will almost certainly need a fixed connection. As you say, fixed connections aren’t going anywhere.

        – On that point also- Young people in Japan adopt the easiest thing for them to use, that’s abundantly clear over the years…even to extreme circumstances. They also consume content in a VERY different way to Australians- it is a completely different culture.

        I don’t think it would be directly comparable to talk of young Japanese people viewing a few video clips from their favourite show on the subway trip of 20 mins, compared to Australians being the HIGHEST torrentor of Game of Thrones in September this year….and of which Japan didn’t even show up in the rankings (I’m aware Japan have heavy penalties for illegal downloading (which is actually illegal there), but that didn’t stop them downloading 4.3 Billion illegal files in 2010).

        We have different consumption patterns. We can learn lessons, certainly, but I don’t for one moment think most Australian young people are going to start viewing 15 minutes of video on their phones as their “total consumption” for the day. They will go home and watch/stream/torrent (hopefully less so with decent streaming services) their favourite series- we are a thoroughly Western Culture and, as such, for better or worse, watch ALOT of TV. Perhaps download a few to their tablet. That’s certainly what all my friends do and I have both tech savvy and technophobes as friends.

        – I personally don’t know what amount of affect it would have, in value or decline of growth terms, but I don’t think you can ignore the HUGE hit Japan has taken on its’ economy in the last 5 years. They not only got a double dose of GFC, because of high government debt, they also got the Tsunami and Fukishima. I don’t think it’s a stretch to say, overall, Japanese people are spending less- both on wireless and fixed line and of course, with fixed line, it is more noticeable, because the growth was smaller to begin with. I am not saying it is the ONLY factor, but it would be a significant one nonetheless.

        – On the concerning slowing growth of FTTH, again, the economic factor would come into it, but also, because of the consumption pattern, the companies may have overestimated the data requirements. I’d be interested to see what Japan’s average per user and per premises usage is per month. I can’t find any information, after a quick search, but I’d like to compare it to our own, if you know where the information can be found? I’m not saying the growth isn’t a concern for the companies. But they may have overestimated that growth overall, especially with an economic downturn.

        On the NBN and the ramifications of your article-

        Early indications on the NBN are that people currently WANT the speeds the NBN is offering already. We don’t have a problem with takeup because of the Telstra/Optus deals, unless you believe our modest LTE networks will grow to TWICE the capacity of our 3G networks (hopeless congested in the cities) in 10 years…a bit of a stretch for a country the size of Australia and especially if we have the NBN coming in at the same time.

        Could the early indications be high? Definitely and in fact we’ll probably see a drop in average speed (which is sitting at close to 60Mbps right now) to around 45Mbps, as I’ve said numerous times here and on Whirlpool, over the next few years. But we will STILL have the uptake and speeds to WELL exceed the NBN Corporate Plan. 1) Because the largest RSPs in Australia aren’t offering 12/1, meaning the 48% forecast by the 2012 CP in 2021 is almost impossible and 2) Because the speed uptake overall is still MUCH higher than predicted. This makes the idea of an under-utilised NBN, causing losses to government due to weak revenues, unlikely, although not impossible, as BOTH metrics of uptake AND speed appear to be being exceeded.

        Japan is a country in a state of change. Whether that change will lead them to mainly wireless, is as yet, unknown. But that does not mean we are heading in the same direction. We have different consumption patterns, different population statistics and already show a high demand (probably because of years of neglect on reliable speeds) for the NBN speeds. Ultimately though and what I always come back to is, will the NBN pay itself off? I CANNOT see, anywhere, a situation where our fixed line usage will decline SO much that it will not.

        And that, in my eyes, ultimately answers the question of whether it is prudent to build it- Do we and will we want/need the speeds? Yes. Do we have the money/responsible debt capacity to build it? Yes. Will it last longer and provide more, than any interim network such as FTTN? Yes. Will it be paid back ? Yes.

        Should we build the NBN as is? Well, that’s got to be a resounding yes.

        I’m interested in your thoughts on Mr Turnbull seeming to indicate your article favouring his view, by retweeting it, that the NBN is a waste as is, because it is over provisioning and therefore it should be cut back to FTTN

        • @seven_tech

          Apologies, I am somewhat flat-out this morning so can’t answer all the points you raise.

          However, in answering your final question on Malcolm Turnbull, the facts are that he is in a tough spot as he will have to ‘walk back’ a lot of people from their originally promised 100Mbps FTTH connection.

          In many non-APAC markets (Japan, Korea, Singapore) the trend is more towards ‘building out’ fiber, pushing it closer and closer to the customer before eventually – when time and money allow – moving to full FTTH.

          This is obviously where technologies like Vectoring, Line Bonding, Phantom Mode, G.Fast come into play – although these are all really only effective on short copper lengths of sub 1Kms and are useless once youu get towards 2kms.

          So, in terms of deploying super-fast broadband in Australia, we are between a ‘rock and a hard place’ the choices are between a] Sticking with the NBN as is, even though its extremely expensive and will take a very long time and is requiring some pretty major actions [shutting down HFC], b] Moving to an alternate plan like FTTN – the problem being though that to really make FTTN viable you need to push fiber much closer to those homes which are now 2-5kms from their existing exchanges – this is a big task in itself, though not impossible.

          Both choices are flawed in some ways, whichever road we travel the one thing we need above all else is certainty, if we could get some bi-partisan agreement on this it would be great or else we will slalom between competing plans like a Saturday night drunken driver and end up wasting time and money.

          NBN Co. will be the vehicle which drives us towards faster broadband, its just a question of how we end up getting there.

          • @Tony Brown

            I think there, you’ve hit the nail on the head, multiple times. Turnbull will take a serious hit on popularity when trying to rollback guaranteed 100Mbps speeds, regardless of voting intention.

            And it is also ridiculous that this has become such a politically polarised issue. Broadband is vital for this country, but the political landscape has given us an attitude in politics of all or nothing and people are, rightly or wrongly, terrified we’ll either:

            a) Get it wrong by stopping the NBN and end up 10 years behind the rest of the world
            b) Get it wrong by continuing it and end up with a vastly larger capacity network than we need with the accompanying debt that will perhaps cause issues during a downturn.

            There seems to be no middle ground, except by Turnbull. But if he doesn’t produce some reasonable details on the Coalition policy, it just becomes more and more likely people will ignore whatever Turnbull does come up with, as many believe he dosen’t speak for the Coalition policy plans at large.

      • > This is a serious issue given that FTTH penetration in Japan is still only 46% – compared to 71% in Hong Kong – so still has plenty of room to grow, you might expect ‘saturation’ slow down to kick in at 75% or so but certainly not at 46% HH penetration.

        > Indeed, if the current FTTH net sub adds decline continues – and it well might – then they might add below 1 million subs in the year to June 2013 – they need to re-ignite growth or they will be in real trouble.

        Actually, NBN Co is not only being as positive as expecting saturation slow down after 75% but instead, it’s expecting total take-up by 2021 to be at 70% as percentage of premises passed – check page 75 of the corporate plan. And only 24% where fixed wireless and satellite is offered.

        That means that NBN Co is expecting a total take-up of 66%, fibre, fixed wireless and satellite. That’s less than Hong Kong currently has and that’s pretty much the same as total share of DSL+HFC+FTTH at the moment. And there’s no big reason to believe that that total is going to go down much, or that people are going to be migrating from DSL to 4G instead of FTTH to an extent that’ll drop it much below that percentage.

        Either way, no one involved in the NBN planning is optimistic enough to expect take-up to be 75% or more – but much less – if it happens then all the better.

        • @Quink

          Yes, I have seen those NBN numbers before for HH take-up, the NBN Co. figures are different to Japan because Telstra/Optus/TPG/iiNet subs will all be tipped onto the NBN whether they like it or not (if they want to continue with a fixed-line service) – so the take-up rates are ‘forced’ to some degree.

          The Japanese example is different because NTT has a de facto monopoly on its FTTH networks (its wholesale rates are so high its not worth anyone launching services) and the Japanese are having to persuade people to take FTTH, they can’t simply close down the DSL networks (although that’s the ultimate goal).

          The reason the slow take-up is crucial for NTT is that they have managed to lock KDDI, Softbank, JCOM etc. out of their FTTH networks by saying to the government that they (NTT) will push FTTH to all corners of the country – but they would scale back FTTH rollout if they had to lower their wholesale rates.

          So, their argument was, “Leave our FTTH monopoly alone and we will deliver FTTH to the country.”

          The government has so far left them to it – although they have made occasional noise about ‘taking action’ against NTT (structural separation, etc) but if FTTH take-up continues to slow down then the government will be able to say to NTT that it is failing in its job of delivering FTTH to the nation and that they need to introduce proper FTTH competition into the market by forcing NTT to properly open up its FTTH networks (like it did with its DSL networks) to rival players.

          The likes of KDDI and Softbank would LOVE the chance to piggy-back on NTT’s FTTH network, it would transform their businesses (especially Softbank) so this is critical for the Japanese market, if the slow take-up of FTTH continues then NTT will very likely be forced to open up its last-mile FTTH networks – and that’s a real game changer.

          • “The reason the slow take-up is crucial for NTT is that they have managed to lock KDDI, Softbank, JCOM etc. out of their FTTH networks by saying to the government that they (NTT) will push FTTH to all corners of the country – but they would scale back FTTH rollout if they had to lower their wholesale rates.”

            Wasn’t this Telstra’s argument as well? “We will build the NBN but we will not accept regulation of the wholesale price?”

            Isn’t this scenario, private sector monopoly, exactly what turnbull is suggesting for Australia?

  15. The scenario the writer of the article paints as actually happening in Japan is exactly the one predicted by a lot of us who are regularly villified as stupid and ignorant by the NBN fanboys. That enough people will find that mobility is what they need and/or one phone is all they need or can afford so it has to be their mobile that FTTP simply won’t end up with enough paying customers to pay back the $50B it will cost. That it’ll never get to the 70% it needs to to pay for itself. But because it is owned by the government, not investors, it can’t go bankrupt and be sold off at a loss and then be able to charge a lower price. So either the poor who can’t afford it as well as their mobile will end up subsidising the well off who can, or NBNCo will have to put up it prices which will push even more people off it.

    The advocates of the NBN are just refusing to consider even the possibility it won’t make its takeup targets, so nothing is done to prevent that occurring. Its full steam ahead, don’t worry about trying to do anything as cost-efficiently as possible, this network is about the technical best fastest network we can build, and if we can’t find enough people who actually want a technical best highest speed possible internet connection that’ll be someone else’s problem. Well, we taxpayers will be that someone else. Not Quigley. Not Conroy. They’ll be long gone with fat pensions. In business there are consequences for the people making the decisions, so they treat the money in their custody prudently. But not the the NBN. It has become more like a religious mission.

    • @Gordon

      It IS meeting its’ takeup targets. In fact, it is exceeding them. It is at 17%. They predicted 12% this year. It’s rollout targets are on track after the delay from Telstra/scope change/address problems.

      And on being technically the best- it isn’t. GPON is poor mans FTTH. P2P is the best technically- it’s what Google are putting in Kansas city- a single core fibre from the POI ALL the way to the premises. But it is SO far beyond normal residential usage even NOW (STARTS at 1Gbps) that is total gold-plating and would cost some 3-5 times more at least.

      I consider the facts about wireless. And the facts tell me, while Australians LOVE wireless, they DON’T use it for their heavy data needs. 96% and growing, of ALL data Australians downloaded between Dec 2011 and June 2012, was via fixed line. Those are the FACTS. Australians are not going to unceremoniously dump their fixed lines. We can and will, in about 70% of circumstances, afford both. (actually, it’s more 85% of circumstances, as 15% of that is vacant premises).

    • WRONG Gordon.

      It is the blinded anti-NBNers who refuse to see.

      The pro-NBN crowd have “always” … let me say that again “ALWAYS” said that fixed and wireless are ‘complementary” services.

      Whereas the naysayers will jmp from supporting wireless only one day to FttN only the next and back to wireless (ironically in line with the opposition) who are close-minded that the NBN is just no good.

      Now the NBN naysayers beat the chest because of one article, written by an analyst (I’d bet most here, including you, would never have even heard of – no disrespect intended towards Tony) about Japan…

      Even Tony mentioned in a reply comment above, that the proof will come with congestion, to see whether people drift back to fixed! I believe this is already occurring in the US.

      Yes let’s take all info onboard and then analyse, not jump to conclusions because it suits your mission.

      Once again these are IMO, complementary services. As one person way back said, it’s like tap and bottled water… would you wash your clothes with bottled water?

      As I mention here, from above, FYI –

  16. How funny. For so long this website has carried on about the NBN, relying on Japan, Korea and Singapore. Now a contrary trend emerges and guess what? Delimiter tries to rationalise it away.

    • Sorry no…

      Most people at Delimiter have resisted such comparisons due to the completely opposing demographic and/or geographic differences.

      Do you actually read the articles and comments?

      • As a country we are in a pretty difficult position for geographical and demographical considerations.

        • Indeed Michael…

          In fact, imo if we weren’t such a large country with such a small population (like Japan)… we wouldn’t need a government built NBN, because the profits would be plentiful and ergo, private companies would have invested or would be investing throughout the entire country.

  17. Hah the costs of what we get charged for 4G wireless compared to fibre and the download data ratio’s between fibre and 4g is massive.

    Sure 4G will become very popular and fibre isn’t certainly dead.

    • I have to agree in our household they work hand in hand so as I get to work it flips over to the work network and soon as I am in range of the home the same I only use mobile data when out and about if required to keep costs down.

  18. The answer to this whole article, is here —->

    “but that is no sure bet, especially if operators manage to make Wi-Fi offloading seamless and therefore reduce LTE traffic congestion in high demand network areas.”

    Anthony Wasiukiewicz

    • “but that is no sure bet, especially if operators manage to make Wi-Fi offloading seamless and therefore reduce LTE traffic congestion in high demand network areas.”

      In other words, move sufficient traffic back off LTE and back onto Wi-Fi fixed line (FTTH).

      I think I am confused because he seems to be saying that LTE use will increase if LTE use decreases.

      • @Goresh

        One of the biggest issues with LTE right now is the way in which data connections drop out in high-traffic areas, one of the biggest focus for operators is to find ways in which they can use Wi-Fi for data offload.

        At the moment this is done very clumsily via hot-spots etc, the onus is on the subscriber to know he/she is in a Wi-Fi hot-spot etc, log on and go off the 3G/4G network – this is far from satisfactory because most subs aren’t going to do this.

        Therefore, what operators/vendors are working on – and getting close to doing commercially – seamless handover between 3G/4G and Wi-Fi, effectively switching between the networks without the subscriber even knowing it.

        There are some technical and commercial issues here which are still being worked through but once it happens then the mobile broadband experience in high-traffic areas should improve to a significant degree.

        To clarify, this does not remove the need for fixed-broadband, it merely improves the performance of the existing 3G/4G networks and makes them more sustainable for operators.

        • @Tony Brown

          +1 LTE-A will be the driver if this, having WiFi seamless voice and data handoff built into the standard.

          It will be an exciting time in 2020 with FTTH red WiFi and LTE-A….

  19. someone above (seven_tech? brown?) mentioned that in Japan there is little torrenting/usenet usage and that Australians do this a LOT .

    Does anyone know the % of traffic in Australia that is torrent/usenet related?

    I’m imagining it is a huge % of all traffic and if you removed it you’d end up with much less network requirements

    • @jon g

      AFACT reckons only some 17% of Australians do it once a week, while 10% do it once a month.

      So I’d say that theory doesn’t really hold….

    • There are really only two ways to reduce that usage.
      Draconian laws that would never make through our parliament.
      Alternate services that will just shift bandwidth from Torrents to “legitimate” services.

    • heck, just legitimate usage is probably enough to justify a “robust” NBN, 2.2 million downloads of the iView app alone shows a lot of people interested in streaming and that doesn’t take into account non-Apple downloads, or alternate services like Quickflix and Bigpond Movies.

      It’s only going to increase from here…

  20. Wireless internet is not reliable. The number of times that I have downloaded (or partially downloaded) files and them being corrupted I cannot count. Wireless connections cut out (even if for only a second) regularly, and have high latency. For these reasons wireless will not replace wired broadband any time soon, unless coverage and broadband networks and standards address these issues for the majority of the population.

  21. I’m on a 500Gb@50/2 cable plan with Telstra for $129 a month (split between 3 people). iiNet have a plan thats 500Gb peak/500Gb off peak @ 100/40 for $99 a month (guess what I’m doing once the NBN hit’s my street :-p)

    For 500Gb via 4g wireless I’d be paying around $7,500 a month.

    Wireless is nice as a “check your email on the road” kinda thing, but there’s no way in hell it will replace fixed in Australia while they charge $1.46 a meg…

  22. @Tinman_au

    Telstra has deliberately priced Next G at these high price points to preserve the integrity and stability of the network, they have done a cracking job on this although they have obviously copped a lot of stick from consumers.

    However, Telstra are now reaping the benefits of their policy because their network is positioned as the blue ribbon network and people want to be on it – although they have been helped by the Vodafone debacle etc.

    In other markets where there is more mobile broadband competition (and more spectrum has been released) the 3G/4G (including WiMAX) plans are actually quite good.

    In Japan you can get unlimited 4G WiMAX from UQ Communications for US$60 – that’s a pretty good deal and the speeds are OK as well – and they already have 3.5 million subs.

    • Hi Tony, thanks for the reply.

      I don’t feel Telstra pricing something to a point where a lot of folks don’t want to use it is actually a tick in the “benefit” box when comparing it to/against the NBN, at least not for Aussie workers. I can, however, understand that that may well be seen a “benefit” for rich folks, or businesses :o)

      When you say “speeds are OK as well” for the WiMAX, what speeds are they actually getting? I recall Intel had high hopes for WiMAX, but it never seemed to live up to the hype from what I remember?

      • @Tinman_au

        The issue with Next G is simple, Telstra want it to be a proper ‘mobile’ ‘broadband’ network, that is to say that they don’t really want it used as a ‘workhorse’ network.

        They have figured out that the real value is being able to charge a premium by having fast access available on a 24/7 basis by strongly discouraging heavy network usage and moving subs towards light web-browsing etc whilst on the move rather than as a fixed-broadband replacement.

        Believe me, in my travels around APAC meeting and talking with operators there are plenty – and I mean plenty – of operators who wish they were in Telstra’s shoes, these other guys gave out ‘free candy’ in the form of all-you-can-eat 3G and are now having to take it away, the Singaporean ops are an excellent example of this.

        As for WiMAX in Japan, this is one of the great hidden success stories in the regional market, speeds vary but for the most part WiMAX subs are getting between 4Mbps-8Mbps of continuous connectivity (speeds can go up to 40Mbps).

        The WiMAX technology itself is fine, there are no technical issues at all, the big problem is that it was a ‘technology island’ outside of the GSM family of GSM-WCDMA-HSPA-LTE, so very few operators really wanted to move outside that family of technologies and thus WiMAX is dying a slow death in most markets – although there are pockets of success in the global market.

        The big vendors are now issuing dual-mode WiMAX/TD-LTE hardware to enable WiMAX ops to transition back towards the rest of the telecom market.

        • Cheers Tony, I guess my takeaway from the convo is that none of the technologies discussed can actually replace a well build NBN based on fibre, but can be complimentary to it.

          I kinda think it’s a shame that the “powers that be” didn’t tie in some sort of picto/femtocell deal with NBNCo, Australians could get the best of all worlds (mobile, cost, stable and bulk data) that way…

  23. This makes sense for the youth to choose a service that is best suited to their lifestyle. Because there are caps on LTE, they are adjusting their behavior to ‘fit the realities of mobile broadband’. That’s a consumer market.

    Businesses and organizations don’t necessarily have that ability to ‘snack’ on broadband. Mission critical applications to organizations, such as having financial and sales systems online, need a high-capacity, reliable and un-capped connection to the Internet. Wireless can complement that, but people who suggest wireless is a replacement have not fully understood how Internet-enabled applications are actually used by businesses and organizations – and what that means for network requirements.

    And none of the discussion gets to the economic case and the impacts of broadband. Show me one community or region that can retain business, let alone attract a new business, without having reliable and affordable high-capacity broadband available.

    Regarding the NBN, from my perspective what’s missing in the NBN discussion is what individual businesses, organizations and households could – and should – be doing with NBN connectivity. Not only does such a focus help define what is appropriate from a network perspective, but without a focus on utilization the NBN will continue to be a ‘retail play’ rather than a driver of economic development.

  24. Will Japan’s recently announced draconian penalties for piracy further erode the business case for FTTH in that country?

  25. How does Japan’s economy actually shrinking by 3.5% a year factor in this? It could be that Japanese people may not be able to afford both land and mobile plans, and just settle for the mobile?

  26. Article is assuming that just because more people are getting wireless than fixed that this means people are dumping fixed.

    eg if I upgrade to fibre and also get 4 x 4g mobiles for my family that I have “dumped” fixed line.

    It ignores that I only have one house but 4 people. and actually ADDED to fixed numbers. Do they expect loss to buy their own houses?

  27. There is only so much data you can squeeze through a wireless link. The Nyquist capacity theorem is a limiting factor there.
    With LTE implementing both OFDM and Multiple-Input Multiple-Output, it is approaching the absolute capacity limit for given spectrum at reasonable power levels.
    There is little more to be gained in the coming years in terms of bandwidth or bandwidth density in terms of wireless without the allocation of more spectrum.

    Fiber on the other hand is limited mostly by the speed of the electronics at each end, and provides a dedicated link with (in theory) terahertz of available spectrum, as such it will always be able to outmatch a wireless solution for speed.

    In this case (Japan) it looks like decent competition, and low-cost high quality mobile services are the cause of flattening subscriber growth in fixed line.
    History shows that neither of these is remotely likely to be a problem in Australia.

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