iiNet CEO warns of telco-centric NBN

Stuart Corner
Tuesday, 18 August 2009 05:08

Opinion and Analysis

iiNet managing director, Michael Malone says there is a danger of the NBN being developed under a 'carrier-centric' model that would require every service provider to go through a carrier or primary service provider that 'owned' the connection to the home, rather than being able to establish a direct relationship with the customer.

Just how providers of content and services gain access to customers over the NBN is one of the fundamental unanswered questions, and one on which there has so far been no leadership shown by the Government. Communications Alliance has seized the initiative and rallied industry behind a project to define the NBN , but with no guarantee that the Government will take on board any of its outcomes.

Malone, however, is not happy with the direction that the Comms Alliance work is taking. In a briefing earlier this week following the announcement of iiNet's results Malone said that NBN customers must be free to choose any service provider. "Regulatory policy must support a multiple service provider environment [and] the physical and technical systems must also be able to cope." He warned that this was an issue that needed to be addressed immediately, saying "The momentum on NBN has started."

He told iTWire: "We don't yet know what the structure of the NBN is going to be...We have not yet had that consultation and we are not hearing an painting of that vision [of an open access model] from the government as yet...But what I am seeing coming out of Comms Alliance seems to be a very carrier-centric model which would see one carrier owning the connection to the home and any content provider having to go through that carrier."

He added that the telco- or carrier-centric model had been adopted in a number of other countries," because generally the telco owns the fibre," but said: "It does not have to be that way. [The NBN] could be done much more as a cloud where a customer could access services form several service providers and not have to deal with a primary telco...[For example] a smart grid does not make sense in a telco-centric model."

Other industry players have flagged this issue, being more optimistic that the open access model will prevail or flagging the considerable complexities it introduces into the NBN. In a recent briefing on the NBN, Tony Malligeorgos, vice president of Ericsson Australia, said he believed that the NBN would evolve as a hybrid model where some service providers gained access to the customer via a primary service provider, but others were able to establish direct relationships. He suggested this latter approach would be essential in order to enable content and service providers to combine different types of content and services without being constrained by primary access providers.


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