The future of super-fast broadband services to the many homes on the pay-TV network in our major cities remains up in the air after Dennis Steiger, the National Broadband Network’s new technology chief, appeared to contradict his boss Bill Morrow last night during a thorough grilling at his first appearance in Senate estimates.

At issue is the likelihood of any future upgrade to fibre-to-the-premises (FTTP) for households that are set to receive the NBN over their pay-TV or hybrid fibre-coaxial (HFC) cables.

It is a key question affecting more than 3.2 million homes that were left out of the NBN’s new roll-out plan pending the imminent finalisation of deals with Telstra (expected before Christmas) and Optus. The plan, released on Monday, will add some 1.9 million premises by mid-2016 to the existing 700,000-odd premises already served by the NBN.

That morning Morrow spoke plainly to Fran Kelly, saying the NBN’s priority was to get everyone connected as soon as possible, using whatever technology minimised cost to the taxpayer, to fix up Australia’s woeful broadband by comparison with other developed nations and underpin a faster transition to a digital economy. Morrow added that for each of the technology alternatives to FTTP, such as HFC or fibre-to-the-node (FTTN):

“I want to point out that — I think this is an often misunderstood issue — that by deploying these multiple technologies we can upgrade later so if it turns out that we are just needing so much more speed and bandwidth and data capability than what the current technology choice can give us, we have an upgrade path.”

Last night, however, Labor’s former communications minister Senator Stephen Conroy asked Steiger directly whether the NBN Co had an upgrade path from HFC to FTTP. Steiger’s clear answer was no. This caused minor consternation on Twitter, with NBN Co spokesman Andrew Sholl weighing in to explain NBN Co saw no need for an upgrade path given HFC overseas was delivering download/upload speeds of 500/50Mbps.

Those speeds are a way off in Australia, however. Morrow last night spoke of delivering more broadly, via the HFC network, download speeds of up to 100Mbps — his own HFC connection gives 50-70Mbps right now, on what is presumably one of the best plans available.

A very live question is how much money NBN Co will need to spend upgrading the aged Telstra and Optus HFC networks just to deliver today’s download speeds up to 100Mbps. Industry sources reckon current capacity of systems and backhaul in the existing HFC network provides for 20% broadband coverage, indicating NBN Co will need to lift the network capacity at least three-fold. Then there are some 700,000 lead-in connections that need to be made between the overhead cable and the home. As the cost of FTTP connections continues to fall, the question is whether NBN Co’s investment in HFC is worthwhile or will be stranded.

Something called the NBN will arrive at many of our doors before the next federal election. It will deliver faster internet than we have now. It might come a bit sooner than a pure FTTP rollout would have done. But unless you’re in one of the lucky suburbs getting fibre all the way to the premise, your connection won’t be future-proof and might not deliver on the wonderful promise of the internet — telehealth, smart grids, the internet of everything. The consequence of building a cheaper, faster-built NBN is that at some point down the track, for the majority of premises, it could well need to be done again. And the cost of any future upgrade to FTTP, NBN Co confirmed last night, will be borne by the user.

The cheaper, faster-built NBN may prove a false economy. As this controversial, searing critique of the multi-technology NBN by ABC technology editor Nick Ross warned two years ago — build cheap, build twice.

*Correction: An earlier version of this story incorrectly said HCF overseas was delivering download/upload speeds of 500/50MBps. The correct figure is 500/50Mbps.

Peter Fray

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