Thursday, 31 August 2017 11:03

NBN Co corporate plan: no change in fibre-copper mix Featured

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NBN Co has no plans to increase the number of premises that receive fibre-to-the kerb (or curb as the company calls it) and these will not increase beyond a million as it has already specified.

Outlining its corporate plan for 2018-21, the first plan that goes beyond the projected end of the rollout in 2020, the company rolling out Australia's national broadband network indicated that the cost of delivering full-fibre connections to new premises had dropped to $2100 per premise. For brownfields sites, FttP is still costed at $4400.

FttC connections have a typical copper lead-in of between 300 to 400 metres; in the hustle of the politicised debate over the network, it has often been confused with fibre-to-the-distribution-point where the lead-in is much shorter, about 40 metres. The cost of these FttC connections has been estimated at $2300 per premises, the same as for fibre-to-the-node connections.

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The full NBN Corporate Plan was not released today and there was no indication of when this would happen. What the company did issue was a media statement and a series of slides that were used for a presentation. (NBN Co later sent iTWIre a link to the full plan.)

Going by these two documents, the company does not see expenditure rising beyond the peak $49 billion funding when the rollout is completed in 2020 as has been projected.

The number of premises has fallen to 11.6 million with fresh geospatial mapping predicting this lower figure. The earlier figure had been up by more than 300,000.

In 2020, the NBN Co expects to see 8.1 million premises activated, revenue of $4.9 billion and an internal rate of return ranging from 3.2% to 3,7%.

nbnco

In 2021, the first year after the build, the company said it expected to be cash-flow positive, with $5.4 billion in revenue from 8.6 million active services and average revenue per user being $52 per month.

In full-year 2018, the company expects to connect three million premises after reaching a figure of 2.8 million in FY2017.

The overall speed mix, however, indicates that less than 20% of those who connect to the network will subscribe to the top speed plans of 100/40Mbps. Even the 50/20Mbps plans will be a small percentage.

The 25/5Mbps plans will be taken up by most, nearly 50% of the subscribers, according the NBN Co's presentation slides.

nbn co speed

NBN Co chief executive Bill Morrow said: "Our strategy remains unchanged to have the network built and eight million premises connected to an NBN Co service by 2020, within peak funding of $49 billion and IRR of 3.2% to 3.7%.

“FttC is currently expected to support one million premises, and we continue to look for ways to make it cost-effective to hopefully expand that footprint further. As planned, we will launch FTTC in 2018.

“On top of the reduced number of expected premises in FY2020 plans, we have also been able to bring forward the rollout for 200,000 premises, making them ready for service earlier in FY2019.  This now means we expect to be 97 per cent completed by end of June 2019."

Morrow said NBN Co had now reduced its expected peak funding range to $47 billion to $51 billion.

"Since our 2016 corporate plan we have reduced our peak funding expectations from a $10 billion range, to a $4 billion range today." 

Graphics: courtesy NBN Co

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Sam Varghese

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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.

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