Thursday, 06 April 2017 12:53

Inabox chief slams lack of competition in NBN business


The head of a medium-sized telecommunications firm says competition in the sector has been hit for six by the decision to have as many as 121 points of interconnect for the national broadband network.

Damian Kay, chief executive of Inabox, told iTWire in response to queries that only the big four telcos — Telstra, Optus, TPG and Vocus — could afford to build into so many points of interconnect and this effectively created another tier in the industry.

A POI is a physical location where a retail service provider links their existing network to the NBN. It constitutes a meeting place between the NBN and the people who complete the circuits concerned, end to end, to create something functional that a customer can buy.

Kay said about $250,000 was required for each build and this was prohibitively expensive for smaller providers.

"It is to do with the physical number of POIs that a provider is required to build into (estimated at about $250K per build) plus the cost of backhaul from all 121 POIs," Kay said. "If it was only 8 POIs then smaller providers could afford to build into them."

He said that while it was possible for the smaller providers like his own company to buy access from the NBN directly, only the big four could afford to build into the points of interconnect.

Smaller companies like Macquarie Telecom, Inabox Group and MyNetFone/Symbio could afford to only build into a small number of POIs; this meant they had to pay the big four for access and this meant costs to the consumer would increase.

Kay said in many cases, the systems of the big four were not the best, being poorly designed. This led to errors, both upstream and at the level of the smaller provider.

Additionally, this inability of the providers like Inabox to build into POIs led to the creation of an additional level of bureaucracy and any communications with NBN had to pass through an additional layer. The consumer suffered as a result.

Australia had more than 400 RSPs who wanted access to the NBN and the big four were not equipped to handle this number, Kay said. This meant outfits like his had to step in and the margins became too much to bear.

The degree of congestion on the network was also increasing due to this shutting out of everyone but the big four, Kay claimed, adding that he had seen people with 100/40 connections getting just 1.5Mbps throughput due to CVC congestion.

If over-the-top services like IP voice/hosted voice, cloud back-up/storage or cloud compute were put onto congested networks, this would make an already bad situation even worse.

Kay said one solution was to have the NBN provide wholesale access. This would allow other companies to be in charge of their own destiny, it would remove one layer of bureaucracy and allow smaller companies to build into the NBN directly and not into the systems of others that were sub-standard.

Subscribe to ITWIRE UPDATE Newsletter here


The much awaited iTWire Shop is now open to our readers.

Visit the iTWire Shop, a leading destination for stylish accessories, gear & gadgets, lifestyle products and everyday portable office essentials, drones, zoom lenses for smartphones, software and online training.

PLUS Big Brands include: Apple, Lenovo, LG, Samsung, Sennheiser and many more.

Products available for any country.

We hope you enjoy and find value in the much anticipated iTWire Shop.



iTWire TV offers a unique value to the Tech Sector by providing a range of video interviews, news, views and reviews, and also provides the opportunity for vendors to promote your company and your marketing messages.

We work with you to develop the message and conduct the interview or product review in a safe and collaborative way. Unlike other Tech YouTube channels, we create a story around your message and post that on the homepage of ITWire, linking to your message.

In addition, your interview post message can be displayed in up to 7 different post displays on our the site to drive traffic and readers to your video content and downloads. This can be a significant Lead Generation opportunity for your business.

We also provide 3 videos in one recording/sitting if you require so that you have a series of videos to promote to your customers. Your sales team can add your emails to sales collateral and to the footer of their sales and marketing emails.

See the latest in Tech News, Views, Interviews, Reviews, Product Promos and Events. Plus funny videos from our readers and customers.


Sam Varghese

Sam Varghese has been writing for iTWire since 2006, a year after the site came into existence. For nearly a decade thereafter, he wrote mostly about free and open source software, based on his own use of this genre of software. Since May 2016, he has been writing across many areas of technology. He has been a journalist for nearly 40 years in India (Indian Express and Deccan Herald), the UAE (Khaleej Times) and Australia (Daily Commercial News (now defunct) and The Age). His personal blog is titled Irregular Expression.

Share News tips for the iTWire Journalists? Your tip will be anonymous




Guest Opinion

Guest Interviews

Guest Reviews

Guest Research

Guest Research & Case Studies

Channel News