Broadband Australia

Government cuts through with long-term plan for FTTH

The change of direction announced on 07 April is a sensible and realistic one. Two big things have changed since the Government launched its original FTTN policy. First, the global financial crisis capital made the original 4-5 year timeframe problematic. Second, it had become clear that access to Telstra's copper network would be very difficult to achieve and maintain. That access is essential to build an FTTN network.

The new 7-8 year timeframe will give the project more financial and commercial flexibility, and it will allow Australia to exploit the emerging high-speed fibre technologies that will be commercialised over the next two years... In addition, the choice of FTTH technology will bypass the copper network, eliminating the regulatory issue around sub-loop unbundling of copper lines.

The industry will welcome the open regulatory reform process that the Governent is now launching. There are still important regulatory issues to address. First, how much will the fibre network builder need to pay for access to Telstra's underground pits and ducts? Even more importantly, how much will access to the fibre network cost? A low price will discourage private investors, buty a high price will discourage consumer uptake and service innovation. Finding the right access price will be a major challenge.