If we went via an FTTN, it's 20-year life has expired and we'd have done, or be considering "What now?".
What network do we want in 2050?
Fibre everywhere there is reticulated electricity and even further if we can.So if we know where we want to be, the only argument/discussion is:
What's the best way there? In a single-step or via a detour to FTTN?Mike Quigley made the point to Alan Kohler [below] that a Fibre to the Node network can only be an interim measure. If that's so, any Cost Benefit Analysis (CBA) must cost the full build, not just the interim FTTN, but upgrading it to full-fibre, perhaps in 20 years time. The NPV of large investments in the far future is modest because of the discounting, so wouldn't necessarily dominate the CBA.
Mr Quigley made another good point in that interview, new to me:
FTTN services must be priced lower than full-fibre as it offers lower-capability and little upgradability.While FTTN may be "cheaper to build and more affordable", it could well be less profitable. NBN Co are forecasting better than 75% Gross Margin on their network.
Getting solid figures is problematic.
In the TLS-339 Briefing, of August 2005, Telstra pitched 3 options to the Howard Government. My reading of the document is that Telstra only stated it would invest $3.1B and mainly asked for $2.6B of public funds. Just once a higher amount was mentioned, without stating the total project cost.
- $4.7 billion public money, $8.8B total or $10.3B (scaled) or the $15B quoted in 2008, would deliver 12Mbps to 99+% of urban and 94% rural.
- $2.6 billion public money, $5.7B total: 6Mbps to 99+% of urban and 94% rural.
- $1.1 billion public funds, $4.2B total: 1.5Mbps to 98% of urban and 89% rural.
- Fibre is cheaper to build than an FTTN if it rolled out everywhere giving 25Mbps:
- Fibre: $1,350/premise
- VDSL2 $1,250-$1,700/premise + Access Device
- Upgrading the VDSL2 FTTN is at least another $12 billion
- It's 5-10 more expensive to upgrade FTTN to fibre "on demand"
- Optimisation of Networks is a major cost saver. Telstra themselves said themselves they could do 40% fewer nodes than the G9/Terria FTTN/HFTP design.
- Fibre is laid out in long loops, copper is shortest path stars: there is little gained from the fibre already laid to nodes. It's in the wrong place.
QUOTES and Sources
NBN Co's CEO, Mike Quigley, interviewed on Inside Business, 24-Mar-2013.
ALAN KOHLER: Are you going to try to persuade Malcolm Turnbull to stick with fibre to the premises?
MIKE QUIGLEY: What I really have been trying to say publicly and encourage some of my colleagues in the industry to get involved in what I think is a sensible debate so that good policy decisions and good decisions for big infrastructure decisions for Australia can be made on a good, solid, factual basis. And I think that's a good thing to do.
My personal view is fibre to the premise is the right answer for the nation. If we're going to make a big investment, we might as well go to the technology that is going to last for decades and decades. Any other technology is inevitably going to be in interim step and if you're an incumbent who owns the copper - so it's kind of zero cost to you - so it makes sense to use some of those interim technologies.
If you are in the situation as we are here where it's the Government building a brand new infrastructure then I think fibre to the premise is the right answer.
ALAN KOHLER: So are you saying that fibre to the node would have to be an interim measure, that it would always have to go to fibre to the premises?
MIKE QUIGLEY: I think everybody appreciates that. You can only squeeze so much out of the copper and we can see with the explosion of video and the demands for take-up - and that is what we are seeing with the people who we have activated. They are using twice as much download than the average fixed broadband user in Australia. So these people on the NBN are using twice as much data because they've got higher speeds and it's working extremely well.
I expect that trend to continue. It's been happening for decades now in telecoms, as we all know. We remember the old days of dial up modems and we're all now reaching for more speeds and that's what we're finding today.
CISCO paper: The Zettabyte Era, has some historical data on the growth of Internet traffic. "IP Traffic" is total bytes on network, "Internet Traffic" is web and data, possibly Video.
Globally, IP traffic will reach 15 gigabytes per capita in 2016, up from 4 gigabytes per capita in 2011, and Internet traffic will reach 12 gigabytes per capita in 2016, up from 3 gigabytes per capita in 2011. Not long ago, in 2008, per capita Internet traffic was 1 gigabyte per month. In 2000, per capita Internet traffic was 10 megabytes per month. Figure 2 provides a view of the historical benchmarks for per capita Internet traffic.
Figure 2. The VNI Forecast Within Historical Context
Most IP traffic growth results from growth in Internet traffic, compared to managed IP traffic. Of the 110 total exabytes in 2016, 81 are due to fixed Internet and 10.8 are due to mobile Internet. Fixed and mobile Internet traffic, in turn, are propelled by video. The sections that follow explore the trends contributing to the continued growth of global IP traffic.
Wikipedia also tabulates Historical Internet Traffic, attributed to CISCO. The year-on-year growth rates since 2000 are spectacular, but reducing, suggesting extra capacity is less needed. [Table below].
Just the increase in traffic in 2011, 7,000PB/month was more than the total traffic in 2007, 6,430PB/mth. CISCO are forecasting CAGR (compound annual growth rates) of 29-30% for the next 5 years. The wild ride is far from over. The ABS figurers from Australian ISP's have a CAGR of 53%.
| 2000 | 200.0% |
| 2001 | 134.5% |
| 2002 | 105.5% |
| 2003 | 93.5% |
| 2004 | 88.4% |
| 2005 | 64.3% |
| 2006 | 64.5% |
| 2007 | 61.1% |
| 2008 | 54.4% |
| 2009 | 45.2% |
| 2010 | 40.1% |
| 2011 | 36.1% |
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