Feeds

Cherry-pick undermines NBN business case: Switkowski

No, really?

Boost IT visibility and business value

NBN Co chief Ziggy Switkowski has told a Senate committee that “cherry-picking” network rollouts planned by TPG and mooted by Telstra do, indeed, pose a threat to its own business model.

TPG Internet stated last year that it wanted to extent its metro fibre networks to residential apartment basements, using existing copper to run from the basement to individual premises. That has led Telstra to state in February that it is considering a similar scheme in response to the upstart's business.

Under questioning by Senator Stephen Conroy, Switkowski said that having as many as half a million households connected to other infrastructure providers could well be “problematic” for the NBN business case, particularly considering the rapid rollout TPG is pursuing.

“If we think that we're going to connect approx 10 million premises, and organisations like TPG capture 500,000 high-value customers, there's an economic impact of that. If you amplify that with the inclusions of other infrastructure-based competitors, the economics of the NBN could be severely impacted,” he said.

He said while NBN Co hadn't fully modelled the possible impact, the cherry-picking competitors could damp NBN Co's revenues by between 5 and 10 per cent. The company will be presenting data of different industry models to the cost-benefit analysis that's due to report midyear, one of six the government has commissioned since taking office.

Switkowski said a regulatory response is one possibility, or alternatively, NBN Co could run apartment basement fibre to forestall the TPG/Telstra moves.

NBN Co is conducting its own basement-fibre trials. The company announced today that iiNet, M2, Optus and Telstra have signed up for a three month trial of its basement-fibre-plus-VDSL2 offering.

This covers eight buildings, "a mix of apartments, retail and office buildings", in the Melbourne suburbs of Carlton, Parkville and Brunswick. ®

The essential guide to IT transformation

More from The Register

next story
UK fuzz want PINCODES on ALL mobile phones
Met Police calls for mandatory passwords on all new mobes
Don't call it throttling: Ericsson 'priority' tech gives users their own slice of spectrum
Actually it's a nifty trick - at least you'll pay for what you get
Three floats Jolla in Hong Kong: Says Sailfish is '3rd option'
Network throws hat into ring with Linux-powered handsets
Fifteen zero days found in hacker router comp romp
Four routers rooted in SOHOpelessly Broken challenge
New Sprint CEO says he will lower axe on staff – but prices come first
'Very disruptive' new rates to be revealed next week
US TV stations bowl sueball directly at FCC's spectrum mega-sale
Broadcasters upset about coverage and cost as they shift up and down the dials
Trans-Pacific: Google spaffs cash on FAST undersea packet-flinging
One of 6 backers for new 60 Tbps cable to hook US to Japan
Tech city types developing 'Google Glass for the blind' app
An app and service where other people 'see' for you
Canadian ISP Shaw falls over with 'routing' sickness
How sure are you of cloud computing now?
UK mobile coverage is BETTER than EVER, networks tell Ofcom
Regulator swallows this line and parrots it back out at us. What are they playing at?
prev story

Whitepapers

5 things you didn’t know about cloud backup
IT departments are embracing cloud backup, but there’s a lot you need to know before choosing a service provider. Learn all the critical things you need to know.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Build a business case: developing custom apps
Learn how to maximize the value of custom applications by accelerating and simplifying their development.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.