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ACCC warns NBN, HFC providers on speed claims

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Get ready for another round of NBN-bashing, as critics of Australia’s National Broadband Network project seize on an information paper released by the Australian Competition and Consumer Commission to “prove” that the NBN won’t deliver its promised speeds.

The ACCC’s information paper is designed to pre-empt the kinds of consumer complaints that have arisen in the past, where providers promote services on the basis of “peak” speeds.

It’s hardly a new excursion for the regulator: it’s warned providers against overselling the speeds offered in their ADSL and wireless services in papers issued in 2007 and 2009.

The latest information paper puts fibre-to-the-premises and HFC networks under the same spotlight: since network congestion will exist in different parts of the network, providers shouldn’t use peak speeds to promote their services unless they’re confident that they can deliver.

In the case of the NBN, the ACCC identifies the PON (passive optical network) “split ratio” as a source of possible congestion, along with contention within the ISP’s network, congestion on backhaul links, and any limits on the speeds offered under particular plans.

This last will be the easiest to deal with: a customer who signs on for a 20 Mbps service is unlikely to then complain that they’re not getting 100 Mbps. But plan speeds also knock-on to other parts of the network.

For example, if most users in a given fibre serving area (FSA, in NBN parlance) are signed on for sub-50 Mbps services, the split ratio isn’t going to cause problems. The GPON technology in use will have an average 78 Mbps available for users, when the 2.5 Gbps aggregate capacity is shared between an FSA’s 32 users.

Elsewhere in the network, things will be different. ISPs (not the NBN) will have to dimension the backhaul links they use to connect customers back into their own networks, and as they do today, the retail ISPs will have to decide on the size of their Internet transit connections.

In both cases, “budget” ISPs will look to keep their costs down by under-provisioning their networks: that will differentiate the cheap-and-cheerful from the premium provider. It’s almost certain that some customers of some providers will end up wondering why their 40 Mbps plans crawl along at 5 Mbps or less in peak hour.

It’s that set of complaints the ACCC is trying to forestall. As it notes in its information paper, properly-conducted network tests would be a good way to avoid problems, as long as those tests include peak periods.

And since the political trolls are certain to misrepresent this aspect of the information paper, it’s important to note that it doesn’t single out the NBN. HFC – which is touted both in marketing material and by NBN opponents as delivering “100 Mbps today” - gets the same treatment, because it suffers the same user, backhaul and transit contention issues (only more so: typical HFC networks provision a couple of hundred users per 2.4 Gbps segment).

Given the industry’s history, many carriers and ISPs will ignore this advice – and as has happened in the Australian ADSL and mobile broadband markets, there will one day be fines and corrective advertising imposed on providers that oversell their services. ®

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