James Riley
Friday, 16 October 2009 14:16
Opinion and Analysis
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Three months old and 40 employees strong, the NBN Company's strategic thinking is starting to emerge. And while it might be driving the biggest infrastructure project in the nation's history, NBN Co is intently focused on keeping its footprint small.
That focus is on the last mile – from premises to the nearest point of
interconnect – and on backhaul in geographies that have been
underserved by the market. Where there is contestable infrastructure,
such as inter-city backhaul fibre, that’s up to market: NBN Co doesn't
need to build it and doesn't need to own it.
And that presents enormous opportunities for Telstra's wholesale
operation, regardless of the outcome of its discussions with Government.
NBN Co is, of course, building an open access, wholesale-only fibre to
the home network. This will be universal, delivered to all homes and
business (90 per cent of the population gets fibre, the rest some other
broadband technology)
But its fibre will connect homes to the nearest interconnect point. It
focus is giving retailers open access to a fat pipe into homes and
businesses, replacing the last-mile choke point that has bedevilled the
industry.
And it will certainly not be the only wholesale provider of services.
As a clearer picture of the NBN Co's place in the industry starts to
emerge, it is in what the company won't do that is most telling.
The NBN will not build international capacity: That's for the market to
undertake, based on demand and where that market thinks it can turn a
profit.
It will not deploy backhaul fibre all over Australia as a sole backbone
provider. While NBN Co will clearly build backhaul services to
geographies and markets inadequately served by commercial
infrastructure, it will largely rely on the market for this
infrastructure.
The NBN Co will not provide services beyond a Level 2 bitstream. It
wants to remain as low down on the value chain as possible – leaving
actual contestable service delivery to retailers and managed service
providers.
Aside from providing the premises to the point of interconnect fibre
(or satellite/wireless,) the NBN Co thinking is straight-forward: Where
there is a contestable market for services or infrastructure, it will
rely on the market.
This still leaves an almighty task.
There is a well-worn path to the company's executive chairman Mike
Quigley's door from people and companies seeking to get involved in the
company. The queue that has formed includes the biggest multinational
companies, it includes governments, councils, utility companies,
railway interests, construction firms – and not a small number of
individuals who want to get involved.
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