NBN Responds To Claims FTTP Is Better Value Than FTTN

Research has revealed the longer term costs and savings of Fibre To The Premises when compared to Fibre To The Node, but NBN says a fast rollout is priority.

STRINGER Image / Shutterstock.com

FTTP would deliver better value than FTTN, according to research from Monash University data analyst Richard Ferrers.

In response a representative from NBN told Gizmodo "the figures used as the basis for his analysis are from draft documents from early 2015 — not endorsed by our executive."

Ferrers writes that the access to NBN's financial figures, due to the release of internal documents late last year, enabled the comparison of FTTP to FTTN.

As reported by Delimiter, with his analysis Ferrers took into consideration operation costs and revenue for both technologies six and a half years after deployment.

“The longer FTTN remains in place, the greater the foregone benefit for not switching to FTTP,” he wrote.

Despite costing $2,300 more per premise to install than FTTN, the analysis showed FTTP cost $220 less per connection per year, and the install cost would be earned back in 76 months. FTTP also generated almost $10 more revenue each month than FTTN.

“This is a total net benefit of $360 per household per year for using FTTP over using FTTN.” writes Ferrers.

He takes analysis further into the future to reveal this figure could amount to $9 billion over ten years.

In response to the research, NBN says speed of install and deployment being of greatest importance.

"Our priority is to provide access to the NBN to all Australians as soon as possible in the most cost-effective way with an upgrade path to meet future demand. A faster rollout of the network leads to earlier activations and revenue opportunity."

"A full Fibre-to-the-Premises rollout will take significantly longer to complete than the Multi-Technology approach. This means delayed revenue opportunity and an inability to take advantage of a ubiquitous network in the next four years."


Comments

    So fast! So Speedy! So fibre hanging in the basement of my building for two goddamn years while they cancelled FTTP and left us with ADSL while changing to FTTN......

      Cry me a river. Where I live, 5 minutes drive from the Sydney CBD, there was previously no plans for NBN deployment before 2022 and no timeline beyond that. Today they will only tell you that "rollout of the nbn™ network has not started in this area." They won't tell you when it is planned but I will bet a month's pay that by the time it arrives, mobile will be faster. NBN is a massive waste of taxpayer's money that will be DOA for many Australians.

        You really do spout some crap man. Not just here either I might add!

        Fibre will always be faster than mobile. Guess how the mobile towers get their internet? Fibre. Once the network is in place you can easily upgrade the equipment at either end and double, triple the speed as tech improves.

          Seriously, Darren, you are going to stand on that argument? Of course mobile towers use fibre and it's probably got 1000 times the capacity of any FTTP connection. But the point is that you cannot upgrade a connection that doesn't exist and it looks like there won't be any NBN where I live for at least a decade, whereas I got 4G+ the day Optus switched it on.

            mobile towers use fibre and it's probably got 1000 times the capacity of any FTTP connectionI'm sure you're aware that the "F" in FTTP stands for fibre, so the capacity limits are the same, depending only on the modems.

            But the difference is, mobile towers have to supply everyone in range, whereas an FTTP fibre loop is shared between a couple dozen houses. Which is going to be faster, a 150Mbps LTE-A connection shared by 300 families or a 5Gbps fibre loop for each street? Your 4G broadband would be far, far worse than it is now if it wasn't for most nearby houses using ADSL for their torrenting. Can I take you up on that month's pay bet?

            And are you really heaping all that crap on the entire NBN just because you personally hadn't showed up on the 3-year rollout? Even though you can still keep using your precious 4G broadband until the paltry data caps are too little even for you.

        I get letter box drops weekly from NBN, iiNet and Bigpond telling me NBN is ready, because every other building in my street has NBN. Given the complete lack of work, and constant extensions of build date for our building, I honestly don't view it as happening ever.

        I'm physically across the road from the CBD exchange, and our ADSL has lost 10mb of sync speed in the time I live here. Telstra say remediation is coming soon for our issue. When I escalated my job to find out when and what was being done to fix it, I was told the fix is to move our service to NBN. There is no money being spent to fix our degrading exchange.

        Oh and mobile? Sure, let me get excited about paying $100 for 15gb a month over $60 for unlimited physical broadband while never being able to get an acceptable ping ever again, and watching the speed drop to un-usable as everyone else connects.

        Last edited 05/01/16 1:32 pm

          I pay Optus $40 a month for 10Gb on my phone, along with unlimited calls/SMS plus five hours of overseas calls, and I can get 50Gb of 4G broadband a month for $70 from them if I want it. (I'm currently spending $79 for unlimited 4G with Vivid but the service is rubbish.) Vodaphone also do 25Gb for $70 a month. You'd have to be stark, raving mad to pay $100 for 15Gb.

            You'd be stark raving mad to think $40 for 10gb, or $70 for 50gb worth of home broadband in 2016 is a good deal. I pay $69 for 500gb, and if I switched telco's could easily pay the same for 1tb or unlimited. Between subscription music, youtube, Netflix, hulu, presto, Xbox Live and size hungry updates to CAD and other design software we absolutely pummel our download quota.
            NBN would cost me, wait for it, exactly the same money, for much much higher speeds.

              Except we weren't talking about home broadband, were we? It was your last paragraph that started "Oh, and mobile...", which was very, very clearly the part of your post to which I was responding.

              If you're using 500Gb of bandwidth a month, you must not be putting much thought into it. My monthly usage is normally in the range of 10-15Gb, maybe 20Gb on a really big month.

            Getting off topic here, but not all mobile is actually available everywhere. I have a friend who lives in Upper Kedron (Brisbane suburb) and *only* Telstra Mobile works, and even it is patchy and inconsistent. They tried another provider initially and 90% of the time couldn't even get a connection. So while $40 for 10GB sounds ok, it may not even be available :(

            Oh, and the can't get NBN or ADSL either. Despite being less than half an hour from the heart of Brisbane.

              Yep it's like that at Crestmead in Brisbane. You use Telstra or you're f***ed.

                go to a piggyback telco

                http://www.mobilenetworkguide.com.au/virtual_operators_information.html

                  That'd be nice if they worked, unfortunately at Crestmead you're hard pressed getting anyone but telstra working properly.

                  i'm on mine site that is serviced by telstra, but a workmate got Lyca SIM to work (she's romanian and Lyca mainly do international calls).
                  Not sure what others would work out here, but i suspect it would be same boat as Creastmead as the tower only has to supply 180 people.
                  I should get a telechoice or a boost SIM just to see if they work as telstra data costs an arm and a leg

        I'm 4 KM from the Perth CBD and my exchange has no plans to offer NBN now, or any time in the predicted future.

        NBN IS a massive benefit to all of Australia. Blame the moron Government not the technology.

          It wasn't this government that set the schedule, it was the one before it. In fact, FTTN was all about trying to get the likes of you and me onto the NBN in a reasonable time frame.

            Actually it was the current government who slowed the development to a crawl by deciding to change it.

            If you think that any form of building works or infrastructure roll-outs don't start slowly and pick up steam over time, then you are crazy. Sure the FTTP roll out was going slower than expected, it was going to pick up steam over time (and was starting to show signs of that).

            A lot of people knew that changing the technology and roll-out was going to bring us back to square one and thus not really happen by its deadline. Unfortunately too many people who are in positions of power are blinded by their own hubris.

            Just a side note here, i'm not taking a political side here, i'm a firm believer that we should have done it right the first time through FTTP, especially when overseas FTTN is being replaced by FTTP at substantial long term cost (when you consider the cost of putting FTTN in the first place)

        NBN wasn't a waste of money, it was a well-thought investment for the future of Australia.
        However, the lib's current mixed-tech version is a different kettle of fish...

    FTTP would have been deployed faster then FTTN if they had not effectively stopped construction and the ramp up in deploying FTTP. So this is just being political and toeing the party line not actual truth.

    The upgrade path they mention is a limited upgrade path.

    the only benefit is that they under significant pressure to achieve a certain speed and thanks to FTTDP we may have something useful. (FTTDP is similar to what Simon Hackett Said they should be doing ages ago).

    So reason FTTN is delayed, over budget, etc > Liberal Government doing what they do best stuff everything up for political points not for the benefit of everyone.

      Rubbish! Under the previous government, there was zero chance of me getting access to the NBN within 10 years. 10 years!! That's an eternity in technology, a massive risk with almost zero chance of paying off for a large part of the population. There was never, ever going to be "benefit of everyone", it was alway sabout shoring up votes in marginal seats.

      If they were ever fair-dinkum about it, the first places to get it would have been CBDs of our capital cities, not rural Tasmania. But if you enter any Sydney CBD address into the NBN roll-out query - I chose 9-11 Castlereagh St, Sydney (my favourite building in Sydney) and 143 York St (Red Eye Records) - you get the same "rollout of the nbn™ network has not started in this area" message I get when I put my home address in. Meanwhile, my brother, who lives in a marginal seat 80km north of Sydney, has had the NBN since 2014. It's a complete joke.

        That's an entertaining idea that has very little to do with reality, SomeOtherIdiot.

        Please either read up on how the tech works (LEARN, don't think you can dictate or alter it to suit the purposes of your argument or you will find out that you are provably wrong when someone shows you things contrary to your assertions) or leave it to the people who are willing to, eh?

        Also, the same applies to economics, which doesn't actually get more accurate the less information you're willing to contribute.

          I'm pretty sure that the NBN was fast tracked for marginal seats where the government needed something to get people to vote for them.

          The rural Tasmania thing is completely stupid though.
          Get it done in the cities and burbs and start raking in the money. Glad we finally got it late last year.

          It's easy to sound terribly clever and even-handed, Gideon, when your reply doesn't address anything from the comment to which you replied and contains absolutely no substance whatsoever. Nothing I said had anything to do with "how the tech works". All I wrote about was how the roll-out clearly favours marginal seats, not those parts of the country that would benefit most from it. Nothing you said even hints at refuting that fact.

        Why is this a problem? You don't even want NBN, you're happy with crappy, congested, high priced per GB 4G.

          Not happy, I simply have no other option, given that I live on the water. And, as I said, UNLIMITED bandwidth for $79 a month on Vivid Wireless's dedicated 4G network, not per Gb and not on any congested phone network.

    "but NBN says a fast rollout is priority."

    As said with their fingers crossed behind their backs.

      Meanwhile, one Ziggy Switkowski, (you remember him in NBN?) has already argued that present plans are inadequate to meet the emerging demand:

      "We will have to start thinking very differently about the concept of treating all data equally, because to provision sufficient capacity in the network to fully enable Net neutrality you need to build in massive amounts of over-capacity to accommodate usage peaks."

      He's a bit late to the reality of demand patterns.

      Suddenly the argument isn't that "no one is every really going to want the bandwidth of FTTP" (as suggested in the silly "Cost benefit analysis" NBN dredged up from inappropriate research).

      Suddenly it's : "Well if all those movie users who are crowding out the spectrum already want increased capacity, we should start talking about many classes of users -- and payers."

      Suddenly Ovum research already indicates NBN's capacity isn't going to be good enough -- and presumably Ziggy ought to know (late convert that he clearly is).

      To summarise:

      Argument used to be:
      No one will really need all that bandwidth so we don't need to provide it....
      Now it's:
      We need over-capacity beyond what the users are now asking for (optical fibre, anyone?)

      Well, well, well...

        And suddenly that argument of "Why do people need internet fast than X speed? What we have now is adequate." falls apart...

        Last edited 12/01/16 4:58 pm

    I'll cover the $2300 cost of getting to my premise. But I don't even know when I'm planed to get it in my area! So I dunno what all this 'fast rollout' crap is all about, when I check the NBN site & put in my address, it tells me The rollout of the NBN network has not started in this area.

    All of the numbers are a fantasy... $2.4k? As someone in the development game, i know you can't even get a conduct underground between the road and the house for that much.... This is probably the cost to have the network pad you.

    Nbn as of right now has 548,000 ftth on it, at a cost of $6.8billion, that's $12,000 per house. That doesn't not include any of the back haul.

      I find that surprising, I assumed they would just use existing conduit. 2.4K sounded about right to me for pulling cable and terminating.

      The initial l FTTH run was made up of regional (expensive) installations and new developments where yes conduit runs would cost a fortune but no more than copper. Still 12k per home is more than i would have anticipated. Perhaps that 6.8 Billion also includes the conduit rights from telstra for every other premises in the country not just the ones currently connected? That would skew the results a bit.

        They do reuse the existing conduit. The contractors pulled the fiber though the old P.O.T.S. conduit under the reinforced concrete pad out the front. Hell they did the same trick for the street not just the houses.

    I want access to 1 Gbps internet at home.
    The only way that's possible is from FTTP.

      That's fine, you can pay to have FTTP. I don't need 1 Gb/sec so why should my tax money pay for something I don't want or need?

        SIgh.

        I dont need roads, as I don't drive. I don't need hospitals, because I am not sick.

        Why is my tax money getting paid there?

        Because it's part of a functional society.

          As is FTTN, which I am perfectly happy with. I do agree, however, that the government should not be paying for my health care costs, nor anyone else's.

            Shutup you one dimensional self stroking hypocrite. Lets meet so i can belt ur ass back into reality.

            Happy for now, sure; it's still better than what most of us have today. But it can't be upgraded further without shortening the copper path even more by building a node on every block - or replacing it with fibre.

            Bandwidth demand has been increasing by nearly 50% annually for the last 30 years, and web pages, patch downloads, video etc have all grown correspondingly. In 10 years, 50Mbps will feel as slow as 1Mbps does today - but most users will be stuck there. In less than 15 years, 50Mbps will be unusably slow, and we'll have to throw out those nodes and run fibre to all the homes anyway. Duplicated effort, wasted money.

              internet over copper has been upgraded the same way fibre is, by replacing the equipment at both ends of the copper. otherwise we'd all still be on 56k modems. we can't know what will happen with tech going forward.

              thing that annoys me is that most companies want to charge more per month than I pay now for 100mbit internet. I don't need the 40mbit up. Also I get approx 112mbit down, where as the FTTP connections i've seen actually get about 94mbit down, so it would be around 15% slower too

                It's true that new modems boosted copper speeds historically, but there are limits of course - you notice how nothing's improved since ADSL2+ 10 years ago? The only reason FttN is faster is nodes built closer to your house; shortening the copper, and reducing noise.

                All technologies follow a performance S-curve which levels out after maturity. Copper is clearly close to its top, and only minor tweaks to bandwidth-per-metre are likely now. At this stage in their lifespan, mature technologies are regularly replaced by newer tech that's still in the ramp-up stage of their curve - exactly where fibre is right now.

                And needs vary - I personally would happily trade my old 100/2 cable for 50/25, but 100/40 is even better. For yourself, you can look forward to the DOCSIS 3.1 rollout next year, with up to 10Gbps download..

            Ah, you're one of those people that believe that people born into unfortunate circumstances or those who haven't inherited wealth shouldn't have their basic needs met? Yeah cool... I think you should find a city serviced by Google Fibre in the US and move their, because your arrogance and their social policy seems to fit perfectly... You can even own a gun and get in on some low latency gunplay that you would be missing out on.

            Did you also take note that based on the above, the government would make more money back using FTTP than FTTN? So basically... better use of tax payer's money? Ultimately the only argument for MTM is the speed of the rollout... which is also debatable. So you're actually idiotically contradicting your own point. I assume because you're getting FTTN faster than you would of been getting FTTP so you're drooling over that.

            But yeah, clearly your 4G only has enough data available to spend your time trolling news articles and making yourself look like an absolutely nutjob.

              I wish I was your neighbour, with those speeds you wouldn't see me coming

            You do realise FTTN is gonna cost us more than twice what FTTP would have costed us in the long run?

            https://nbnmyths.wordpress.com/why-not-fttn/

            Last edited 06/01/16 12:34 am

        All I'm getting from your answers is "It's all about me. Why should I think about the bigger picture when I can think about the here and now that only directly affects *me*?"

        Utterly selfish and disgraceful.

        I run servers, so I would definitely benefit from a 1Gbps connection.

        I don't have a car so why should I pay tax for roadworks? I don't have children so no tax payment for schools. I'm not sick so forget health tax. Try enrolling in Democracy and Politics 101...

      if you have FTTP you can already get 1000/400mb speeds.

      Just costs alot of money

        I can't wait until my ISP starts offering plans of 200Mbps down and 80Mbps up..

          we can dream :(

            That may happen in the future, I don't see why not, since we already have the infrastructure in place.

    Typical response from NoBN Co - the information is "inaccurate", it's from a "draft", it's not "endorsed by our executive", "our rollout is better than Labor's because X" etc. etc. They've used almost word-for-word the same excuse for every major leak recently, such as the cost blowouts with Telstra's Copper network and the overbuild situation with Optus' HFC network.

    Fact is, we've had several independent analyses of the Coalition's NBN rollout now. Anyone who's not politically tied to the project has said that the Mixed-Tech design is a colossal waste of money and will most likely cost us far more in the long run than the original rollout would have. Meanwhile, NBN Co keep spinning the same sh*t that their plan means people get "better" broadband "sooner", without actually addressing the issues that these criticisms raise.

    A full Fibre-to-the-Premises rollout will take significantly longer to complete than the Multi-Technology approach. This means delayed revenue opportunity and an inability to take advantage of a ubiquitous network in the next four years.

    Bullshit. They've not done any rollouts in regards to MTM yet, other than small scale trials. Yet people, real people, are using FttP right now. If they had of just continued rolling out FttP we'd have a much larger footprint than currently, and it would be getting quicker and cheaper to boot.

      theres an election coming up so there will be no roll out untill that is sorted out

    I would not mind waiting longer for FTTP.

    Give it a few years, FTTN will be redundant and whoever is in charge will be paying big time. Australia's internet infrastructure will always be a joke.

    Last edited 05/01/16 12:45 pm

      Give it a few more years of liberal government, and they'll sell our MTM network to the highest bidder, who will have no financial incentive to ever upgrade you to FTTP, starting the cycle all over again.

    My in-law telstra NBN FTTN seems a bit slower in download speed but faster in upload speed compare with telstra cable DOCSIS3.0.
    I hope that we will get free upgrade to DOCSIS3.1 soon. :)

      Hahaha yep, Cable all the way!

        cables capable of 3 gbps and that was 3 yrs ago, so theres hope for people in the few areas of Australia where there's QUALITY HFC Cable
        https://gigaom.com/2013/06/11/comcast-shows-off-a-3-gigabit-broadband-connection-thats-fast/

    Is anyone doing the environmental and economical cost to the community of FTTN and FTTP? Fraudband will only provide limited telecommuting where as 1 Gbps+ will enable a way greater number of people to do at least a percentage of their job working from home. This would reduce congestion (and related pollution). Reduce the number of hours spent in traffic or amount of money spent on childcare giving a higher quality of life for aussies.

      Majority of people that vote don't understand these concepts, hence why were have FTTN now.

      I bet their thought process went something like this.

      "what this thing about faster internet? I don't want my money going to that, ninemsn loads perfectly for me anyway"

      They only think of it on a consumer level.

    Of course they want to roll it out as soon as possible.

    They (NBN.co) might not be around by the time the next government, led by some new clueless jerk no matter what side gets in, get into power and decided to shut the whole thing down because "it's too expensive"...

      Remember how important Gonski was?
      LNP canceled funding for the rest of it a few weeks ago.

        Just to play devils advocate and be off topic. The education funding never actually existed anyway. But anyway, onto all the fibres!

    If NBN want the hard truths about FTTP and the slow deployment and installation they need to speak to the small contractors employed by their appointed Tier 1 contractors to do the installs. They will hand over a lot of truths as to why the deployment and installations are taking so long. And they almost all come back to 1 issue. The Tier 1s and their ineptitude.

    If the Tier 1s were less committed to lining their own pockets and start focusing on assisting and incentivising their installation contractors they would not only increase installation numbers but incoming revenue. Tie this in with better planning and implementation they could easily double or even triple the installation rate of FTTP across the country.

    The Executive also refuses to acknowledge that the NBNco is buying copper to replace the lines that telstra was paid for because 90% of them are incapable of performing to the minimum required specification.

    Pardon me if i have a little more faith in Mr. Ferrer's analysis, having read both his work and the publications on the subject by NBNco.

      The Executive also refuses to acknowledge that the NBNco is buying copper to replace the lines that telstra was paid for because 90% of them are incapable of performing to the minimum required specification.

      Got a source for that? Intrested to read up on it.

    I'll admit I'm a conservative voter but the NBN has been one stuff up to the next. Sure, I like the idea of FTTP but I was never going to get it. As for FTTN? I don't think I'll ever see that either. Horrible management from the get go. Should have focused on easy to do metro areas with high house numbers to really get a tonne of people connected asap...that never happened. Luckily for me, Im on a fixed wireless solution that's obviously not NBN that plain well kicks arse by a really good local isp.

    “Our priority is to provide access to the NBN to all Australians as soon as possible in the most cost-effective way with an upgrade path to meet future demand. A faster rollout of the network leads to earlier activations and revenue opportunity.”

    This. I just want faster broadband at home please. 25mbps would be substantially faster than I have now, but even with FTTN I should be getting 50 which will be great.

    In the meantime I have 32GB of mobile data at my disposal between 2 networks and I'm only paying $100 a month for it. Once I get any kind of NBN in 2017 I can dial that back a bit.

    Last edited 05/01/16 4:43 pm

    Fortunately for me I am one of the lucky ones and have fttp, one of the last suburbs in Tassie to get it before it is all fttn. 25mb downloads all day and about 8mb up. Life is good.

    $2,300 extra for FTTP? Screw it, I'd pay that myself if I had to. Well worth it.

      Everyone has the opportunity to have FTTP installed at their home address but you will have to pay to have it. So the cat's out of the bag. FTTP costs $2,300 more per installation. The article claims that would be recovered after a few years. That's assuming that everyone subscribes to a NBN service. History has shown that there is less than 50% uptake therefore over half of the $2,300 per premises would be thrown to the wind.

        I thought I had read somewhere that cost depends on the street uptake, i.e. if everyone in the street does it you only have to pay say $400, however if you are the only one it is more like $14000.

    yeah I live in Melbourne cbd and I was told by them work won't even start in my area until q4 2018 unless I want to pay thousands of $ to install it early

    Add to the fact FTTP would be faster as u don't have the last mile, which would still be copper is left with FTTN, e.g from the node to premises is copper, which otherwise would be fiber direct.

    Since its going to be upgraded anyway, why not just 'fit the bill' now for everyone to have FTTP instead of a mix-mode technology to try and save money ?

    For those lucky ones that get FTTP now in the metro area, why should the others get a slower FTTN ? That's hardly a future..... I thought it would be "the future." but that is anything but, particularly if you can make the money back in other ways.

    Otherwise, its something not well thought through..

    Last edited 06/01/16 8:51 am

    Most people in major city CBD already have fast internet. Many are serviced by cable. The plan is to level the playing field and upgrade the poor service experienced by those further afield.

    I paid $2300 six years ago for Opticomm fibre to a new retirement village home, as did 71 of my neighbours. Plus I have a Hills Home Hub and structured wiring (phone and Ethernet) everywhere in the house. Technically the fibre works (we used to have a TV feed via it). However nothing has ever been connected to the head end, so that whole installation was basically a waste of time and money.
    Meanwhile my actual phone connection is via a Telstra CMUX that is so slow downloading a movie is at the very least an overnight and sometime 24 hour task.

    I love porn just like my neighbour, The internets is slow where I dwell, so I just set up some cams in my neighbours flat (FTTP)...

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