Announcement of National Broadband Network: Australia's Great Wall of Fibre

This IDC Insight reviews the surprise announcement of the federal government on April 7, 2009 to build a fibre to the home (FTTH) - wholesale only, open access network to 90% of the Australian population over the course of eight years. The FTTH network is the government's preferred alternative to its originally proposed fibre-to-the-node (FTTN) network to 98% of the population, which the government has tendered out to the industry over the course of the past 12 months. As part of the announcement, the government also stated that it intends to create a new telecommunications entity called the National Broadband Network (NBN) Corporation, which will be co-owned by the government (51%) and the private sector (49%). The NBN Corp. will build the largest network of its kind anywhere in the world at an estimated cost of A$43 billion. The proposed FTTH network cable will use existing underground ducts and pipes wherever possible, but will mainly run over existing power line poles for the last mile access and will operate in tandem with the existing PSTN/copper-based broadband infrastructure. Simultaneously, the government also released a regulatory reform discussion paper that will form the basis of the legislation changes required to streamline potential access/deployment inhibitors and to establish greater market equality via several avenues but mostly by empowering the regulator to deliberate on market issues more swiftly. The same regulatory reform changes seek to force Telstra into either structural/operational/functional separation, limit cross-media ownership and divest some of its existing infrastructure assets.