Nokia Enables NBN’s Nationwide Broadband Goals: A Snapshot from Down Under

Erik Keith - Principal Analyst, Fixed Access Infrastructure

Erik Keith – Principal Analyst, Fixed Access Infrastructure

Summary Bullets:

• Australia’s National Broadband Network (NBN) is on the path to fulfilling its namesake, i.e., bringing broadband connectivity to all of Australia, over copper, fiber and cable wireline networks, as well as fixed wireless and satellite networks for remote locations (e.g., the Outback).

• Nokia is providing the majority of NBN’s fixed access networking systems. As such, NBN is a showcase customer for Nokia while also serving as an example of how nationwide broadband can be achieved leveraging multiple access technologies.

The first day of September, coincidentally the first day of spring in Australia, NBN hosted a field trip for analysts and journalists in the outskirts of Brisbane, Queensland. The field trip was preceded by Nokia’s Fixed Networks Global Analyst Conference, as well as a press and analyst briefing with NBN in Sydney. NBN’s goal is to connect every Australian premise by 2020, with a minimum broadband bandwidth of 25 Mbps downstream/5 Mbps upstream. Australia is the sixth-largest country in the world, with a land area of 7.6 million square kilometers (2.9 million square miles), roughly the same size as the contiguous U.S. However, Australia’s population of 24 million is concentrated primarily on the continent’s east and southern coasts, in the metro areas of Sydney, Melbourne, and Brisbane, correlating respectively to the ctates of New South Wales, Victoria, and Queensland. NBN is overbuilding and supplementing the existing Telstra network, and provides an open access model, allowing multiple, competing service providers to deliver value-added services such as pay-TV over the network.

The first, short stop was at Telstra’s Redland Bay Exchange, where NBN’s ultra-broadband gear supplements the existing Telstra network from a separate, smaller building. This exchange serves 3,013 premises, with 21% of end users served by FTTP (640 premises), and 79% served by FTTN (2,373 premises). The Redland Bay Exchange, or 4RED-01 Service Area Module (SAM) in NBN parlance, began construction in September 2015 and is scheduled for completion in October 2016.

The second stop on the field trip was in Redland Bay’s Orchard Beach Estate, at what NBN officials described as “the most photographed cabinet in Australia” (see the picture below). Orchard Beach is a 15-year old housing estate composed of relatively high-end single family houses; NBN is serving all of the premises in the estate with a single FTTN cabinet. Leveraging short copper loops, most of the end users in the estate have connection speeds of 100 Mbps downstream and 40 Mbps upstream. In this location, NBN is utilizing Nokia’s well-proven ISAM gear, specifically, a fiber-fed cabinet with vectored VDSL2 to subscribers. The FTTN architecture proved to be the most appealing option for NBN in this location, in terms of both time-to-market and cost.

Orchard Beach Estate, Redland Bay: Outdoor Cabinet with FTTN. Photo by Current Analysis

The third stop on the field trip illustrated a rather unusual situation faced by NBN – applicable to many operators throughout the world. This is where FTTP and FTTdp (fiber-to-the-drop-point) are actually more cost-effective than FTTN solutions. Stop two was literally on the side of the road, specifically, Double Jump Road, adjacent to several farms with lead-ins (driveways) of 270 to 300 meters. Costs for building an FTTH cabinet in this location would have included $200,000 (Australian) just to get power to the cabinet, and an additional 16 weeks. Instead, NBN spent $120,000 to deliver FTTP connections to just three premises. FTTdp solutions will also be leveraged to serve other Double Jump Road customers.

The fourth site visited on the field trip was not a stop, but a moving (bus) tour of the Ridgewood Downs acreage estate (i.e., each house situated on at least 1.5 acres). As with Double Jump Road, the cost of deploying 300 copper-based micro-nodes was actually higher than FTTP. But to be clear, the FTTP implementation was still extremely expensive, with NBN spending “substantially higher” amounts than the $4,400 average per residence for brownfield FTTP connections.

The final site visit on the tour was Mount Cotton. After a brief stop at the base of the mountain to view a FTTN micro-node pedestal, we boarded four-wheel drive Toyotas for the steep drive up to the summit. The Mount Cotton project highlights the extreme measures NBN must go to in order to fulfill its mission. While not an extremely remote location (only 34 km/21 miles outside of Brisbane), pulling fiber up and over the mountain still represented a major civil works project, with the end result of bringing fixed broadband connections to Mount Cotton area residents for the first time. As NBN pointed out, in many countries, the low population density and relatively rough terrain of areas like Mount Cotton would simply be ignored by operators.

Mount Cotton summit: NBN officials highlighting challenges of bringing fiber up and over the mountain. Photo by Current Analysis

So, what conclusions can be drawn from the NBN field trip? First, despite the concentration of the majority of Australia’s population into major metro and coastal areas, there are still massive hurdles to overcome in delivering broadband to every single premise. NBN (and the Australian government, which is funding NBN) are to be commended for remaining committed to the end game goal. While some press and industry luminaries have been pointing to the fiber-rich deployments in Hong Kong, South Korea and Japan as “the way things should be” in the rest of the world, these countries are polar opposites of Australia in terms of deployment landscape (small land masses coupled with very high population densities). Second, while hybrid fiber/copper – as well as hybrid fiber/coax – can deliver FTTP-speed connections to many premises cost-effectively, there are still going to customer premises/locations that are better served by FTTP, especially as a long-term investment. Finally, systems vendors like Nokia remain critical enablers in the ultra-broadband equation. Nokia (via the acquisition of Alcatel-Lucent and Bell Labs) delivers vectoring, phantom mode, G.fast, XG-FAST, and XG-Cable to the market. This includes the evolving array of FTTP technologies with the NBN network buildout providing a well-suited showcase for Nokia’s ultra-broadband portfolio.

About Erik Keith
As Principal Analyst for Fixed Access Infrastructure, Erik is responsible for tracking major technological, strategic and tactical developments in the wireline broadband access market. Erik's primary areas of coverage include FTTP/PON systems, DSLAMs, DLCs/MSAPs, cable access and head-end systems, as well as digital media infrastructure solutions.

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