Reply to post: Re: Chicken & Egg Problem

nbn tries to shift the conversation to future copper upgrades


Re: Chicken & Egg Problem

firstly, thanks for the figures, possibly my lack of keywords but I didn't find that via Google earlier.

> NBNCo require a fixed sum of money to build the network and maintain it. NBNCo delivering a return on investment is heavily dependant on ARPU rising to over $100/month, and the growth strategy is total CVC revenue increasing.

While I would argue about the financial model and how to fund it, it'd be off topic. Assuming we want to aim for that figure to meet their requirements, you're plan is reasonably well thought out, except it relies on ISP's to manage the contention. If it wasn't for that I'd agree that a lower fixed connection price would be better to drive demand.

> At the current drop in 100Mbps users (down 3% in 12 months) the percentage may well fall below single digits based on the current trend.

(down from 19% to 16%)

I honestly don't know why the 100mbit group are going down, but I can imagine its because ISP's everywhere are struggling to deliver it in peak periods, that is what I hear being in an area going FTTP. It makes me sad really, as people associate FTTP with bad service, unable to pinpoint their problems on their shitty ISP. I don't see that being fixed by abandoning tiers though, if anything I think like a congested DSLAM it'll just make the problem worse on peak

> It has worked brilliantly compared with Telstra's model of charging for speed tiers and also having quotas. As with everything you do need to pay a little more for quality.

it hasn't though, as the sales pitch never explains you need to pay more for quality. its not what the ISP's selling their wares are going to explain. I'm not sure what Telstra model you're referring to, but I am aware of ISP's over selling their capacity and never explaining contention. What is it I'm missing?

> GPON2.5 will support ~78Mbps with 32 users. If so much data was being downloaded, then NBNCo would be rolling in cash and the upgrade to GPON10 would be trivial to justify to the bean counters.

and I agree, I don't see that being over subscribed at that level. (and as someone indicated it wasn't even 32 due to future proofing etc) I was simply highlighting there is that bottleneck and we don't look like we'll be approaching it any time soon. Unlike FTTN.

> I can tell you my car is capable of 350km/hr, but that is meaningless if the speed limit is 25km/hr. Continuing the car analogy, Labor's financial model is to build a freeway with toll charges based on the speed limit on the lane you select. The price for the 100x faster lane is only 4x the price but only a handful of drivers can justify the prices.

I'm confused why its an issue, you pay to get more, seems ok to me. But to go on the car analogy, I used max speed to show what the infrastructure is capable of. It doesn't have any upto asterisks on the speed limits, unlike other technologies in play. Could you imagine a FTTN freeway where you can't actually provide the speeds the cars will travel at until they give it a go, and yet will charge them the same amount to use it? Wouldn't work.

If it was a multi lane freeway and I paid more, but not too much more, to go faster, I would. If I was told I should pay almost as much as my car to get the top speed I'd have to re-evaluate my choices (oh but its not too much if you own a house I've heard you state, quoting cost of house vs FoD, it's a bit of a hollow argument. Like saying you only need to get a good job to get a house in the first place)

On top of that to use the new car you have to pay more, kind of sounds like a car really haha, but I'd rather tiers than a single risky option as a nation rollout.

Labor's prediction is that in 2026 1% of customers will be connected at 1Gbps. Currently I'm not aware of RSPs offering a plan faster than 100Mbps, because it simply isn't financially viable.

2026 is ten years away. ten years ago the iPhone didn't exist and mobile data was a luxury. Things change and as usage increases the plans will come online. Its not a large number so I'm not sure why you think it's not going to happen, unless you assume like I do ISP's would struggle to deliver 1Gbps to anyone. Even I think it'll be offered for enterprise in limited forms before the end of the decade.

> I'm suggesting that AVC prices should be cut to a single speed tier and CVC prices should fall slightly slower than predicted in the NBNCo Corporate Plan.

sounds great, but as I've said before I think you cripple user experience via the ISP then. I'd rather it be a little more expensive to get a faster link and force some form of speed controls on the network than let ISP's do it.

> If 79% of customers are connecting at 25Mbps or slower then the choice of technology doesn't make a perceptible difference. The small minority who want fast speeds have the option of moving to a FTTP area or fibre on demand.

My argument is that 79% can pay at any time to go to faster, put them on FTTN and they can't. Even if they are rolling in cash they need to go through the protracted process of getting FoD installed, and I've seen it being quoted far more than the $5000 figure stated my Turnbull.

You might believe its fine to move to a FTTP area, or pony up 20k to get FoD, but as one of the 30% of Australian's renting, moving isn't fun and I can't magic up 20k for a rental property improvement. Rentals don't get these kinds of improvements. It's a new digital divide and I don't see why it has to be perpetuated.

If getting rid of speed tiers would see the back of this larger divide I'd get on board and let the ISP's mangle away with contention. I know it won't though, as those upset by it at the moment are the small minority.

I think that is the bigger problem and arguing that current use of FTTP justifies rolling out FTTN is not good long term thinking. I don't think rejigging the CVC and removing AVC choice will overly affect FTTP uptake - as much as I'd like to see it increase, it'll just make it look like we have faster connections, while giving us more contention.

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