Telstra’s decision to shelve its FttN (Fibre to the Node) plan is hardy a surprise. Apart from the USA (where they
need to compete with broadband HDTV service against the cable TV companies) no
other telco in the world is pursuing a big bang FttN rollout.

The natural path
is first to implement ADSL2+, which can be delivered over the current copper
cable network at speeds of up to 200 times higher than what most Australian
broadband users are currently experiencing. This will keep most of Australia going
for at least the next three to five years. Similar to how other countries are planning
their fibre rollouts, Telstra can also follow a more incremental rollout of
fibre over the next five to ten years.

By introducing FttN,
Telstra had hoped to cut off its DSL competitors, as the FttN network would not
support the current wholesale arrangements. They had hoped that under the
pressure of T3 the government would give them some kind of FttN monopoly.

However, over the last
few years Telstra has also quietly upgraded most of its existing telephone
exchanges with ADSL2+ technology, and on this current version speeds 100 times
the current level could be made available as of today to a very large
proportion of the Australian population. There is obvious plenty of life left in
the current copper based telecoms network.

All other Western
countries have launched their ADSL2+ services since 2003; Australia is
again one of the last to benefit from this technology. In other countries this
has already led to the introduction of e-health services such as video based
call centres for the aged, allowing a significant improvement of home care
services.

With the FttN issue
out of the way I now do expect a speedy rollout of ADSL2+ services in Australia.

While the G9 haven’t
ruled out the continuation of their plans to build their own fibre network,
after Telstra’s announcement to withdraw its FttN plans, the Optus-led project
has now certainly been put on the backburner. Their plan was always to ensure
the survival of competition, not necessarily the building of new infrastructure by
them. With future broadband developments for the foreseeable future based on
the copper based network, the current regulatory regime will stay in place and
thus competition has been saved; especially considering the upcoming ruling from the ACCC in relation to UUL.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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