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FTTN too expensive says Graeme Samuel

Departing ACCC chair’s thoughts on the NBN

Internet Security Threat Report 2014

Graeme Samuel, outgoing chairman of the Australian Competition and Consumer Commission and sparring partner of former Telstra executive Phil Burgess, has said the fibre-to-the-node network once proposed by Telstra would have been a financial disaster for the government.

In years of proposal and counter-proposal over broadband in Australia, Telstra’s final offer was to build an FTTN network in exchange for a regulatory holiday. The idea was finally spiked when the government announced the fibre-to-the-home National Broadband Network (NBN), but it persists among opponents of the NBN, who argue that it would be cheaper, deliver nearly-equivalent speed, and offer an upgrade path to FTTH.

Even the opposition’s communications spokesman Malcolm Turnbull, a long-time booster of wireless, has recently rediscovered FTTN, telling Parliament it would deliver 60 Mbps speeds for far less than is being spent on the NBN – for those households lucky enough to live within 750 metres of the node.

Samuel, in an interview with the ABC's PM programme, says the cost of a Telstra-owned FTTN would include payments to the carrier far in excess of the cost of the network build itself.

“If the [former] government’s fibre-to-the-node proposal had proceeded,” he said, “Telstra could have been entitled to an estimated A$15 billion to A$20 billion in compensation for the relegation of its copper network to the scrap heap,” he said.

“And then Telstra could have taken that money and built a fibre-to-the-home network, past the fibre-to-the-home network but only in the densely populated, most profitable areas.” ®

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