NBN: Cost of FTTN node-to-premise fibre upgrade

One of the planks of the Coalition NBN plan Cost-Effective technology choices, not ideological. They've criticised Labor's process at arriving GPON Full-fibre network to be deployed by a Government Business Enterprise.

The Coalition assertion is that no "Cost Benefit Analysis" was done, whilst discounting the Expert Panel assessment and report as irrelevant. That's a valid political argument and one that Labor has to address sufficiently for the electorate, it's not a technical, economic or National Benefit argument.

The Coalition has to defend its own NBN proposals according to the benchmarks/requirements it places on Labor.
One question that follows is:

Is it Cost-Effective to upgrade an FTTN network to node-to-premise fibre? Where's the Cost Benefit Analysis?

Previously, I've costed the NBN Co GPON FTTP as:

• $2 Billion in common infrastructure (Transit networks, PoI's, facilities), or $16.5M per multiple Fibre Serving Areas connected to Point of Interconnect (PoI).
• $1,340 average per-premise connection cost, plus $845 (est) copper deconnection fee to Telstra.

My guesstimate of the connection cost is:

• $300 upstream costs to FSA.
• $300 Fibre Distribution Area loop. (12.1m per premise, $100 fibre, $200 labour+materials)
• $300 Connection-to-Premise: drop-cable, pit/splitter, lead-in, external wall mount
• $400 electronics: Internal (powered)  Optical Network Termination + head-end GPON electronics. Guess $250 CPE and $150 head-end.

A full-coverage FTTN is likely to cost $1,700 per premise passed, not connected, according to Telstra estimates. If implemented by Telstra, the common-infrastructure, $2 billion, would already be in place. 

The node install costs would cover upstream costs as well.

The 2005 minimum-cost estimate, $4 billion services for $4-5 billion, sets $1,000-$1,250/premise passed, not connected. Subscribers are responsible for their own Customer Premises Equipment, CPE.

This was for 6-12Mbps, ADSL2 160-lines/node @ 1500m, at the "pillar" or distribution area level.

From a statement by Prof. Reg Coutts, that over half the cost of an FTTN is in the node electronics, because as Mr Quigley of the NBN describes, "it needs as much processing as mobile phones", then we can estimate $600/line or $100,000/node.

If Multi-Service Nodes have been installed and the uplink and upstream network are properly dimensioned for upgrade, then only two costs will be different:

• the upstream to FSA is zero-cost, modulo sufficient uplink speed and capacity.
• the electronics. The CPE will be the same cost, but the node line-card may be more expensive (different technology, more hostile environment, smaller cards, low-volume production), say $250.
• Summary: save $300, add $100 per premise
• $1,340 - $300 + $100 = $1,140 full connection.
• = $600 premise passed
• for 12M premises, min-cost $7.25 billion.
• + $540/premise connected
• for 8M services, $4.25 billion connection
• $12 billion total project.

There is more...

• Impact of different topologies: FTTN vs FTTP
• Optimisation of Fibre routes in Brownfield deployments
• Upgrade Projects: Piecemeal, Scheduled or What?