Clarification on fibre-on-demand costs

August 27, 2013
Media Releases

Clarification on fibre-on-demand costs

A report in today’s The Australian contained a number of inaccuracies and misleading statements on the Coalition’s fibre-on-demand policy.

The article states that the cost of obtaining access to Telstra’s duct network is $5 per metre – stating that this could cost homeowners more than $2500 to connect to fibre.

However, the NBN Co has already paid billions of dollars to acquire access to Telstra pits and ducts.

It also states that terminating fibre in a household can cost up to $4000. Yet the article is entirely uncritical of Labor’s claim on April 19 that the customer connect portion of the network is costing $1,100 per household.

Above all, it is wrongheaded to assert that a particular home-owner would bear the end-to-end costs of a fibre-on-demand deployment from a node to their premises.

If The Australian ever bothered to interview anyone at BT Openreach, which it quotes in its story, it would have reported that the costs take into account the deployment of shared network infrastructure.

That is, once a single household requests a fibre on demand product, it becomes cheaper to provision fibre to anyone else in the street whose premises have been passed to order a service at a later date, and that is reflected in the deployment charges.

But most baffling are the contradictions in the article.

If it is going to cost up to $50,000 to connect some houses via FTTP, how will the NBN be able to avoid those costs? And if not, how can they possibly say that the average cost to connect a household in Australia will be $2,400.

And if it is going to cost up to $50,000 for some houses to get FTTP, isn’t it worth trying to avoid that very high cost if you can get those customers a service level that will satisfy their needs the foreseeable future?

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