NBN: The Devil is in the VDSL detail. What happens to Phone Line rental charges?

One of the big promises in the Coalition NBN plan is the innocuous phrase "without disruption".
They are promising to connect everyone to a Node without their noticing.
This has massive and quite complex technical and financial implications.

The unanswered question, already foreshadowed in the Turnbull FAQ, is "if there isn't going to be a telephone line rental charge, what will there be"? Telcos never reduce their total charges.

Coalition FTTN is not "pure-digital" but a hybrid, not good at any one thing, never used commercially.

The first implication is that the Coalition Fibre to the Node (FTTN) network proposed to pass 9 million premises will not be "pure-digital" like direct Fibre, but hybrid Phone and Broadband (VDSL2).

This matters, a lot, in the technical world. Phones are remotely powered via 50V DC with a 4kHz upper frequency, VDSL2 is 30Mhz and locally powered. The current standard, ADSL2/2+, operates at 1.1 and 2.2Mhz, without power as well.

We know how to build 100Mbps copper "pure-digital" systems:

it's called Ethernet (100Base-T). It requires 4-pairs, not one, uses much higher spec cable (cat 5 & cat 5a/6 for 1Gbps) and is only specified up to 100m, not the 800m Turnbull will use.

We also know how to remotely power digital devices over copper: Power over Ethernet (PoE). It doesn't look a bit like the ADSL/VDSL standards.

From the millions of installed internal phone lines in businesses, PABX extensions, we know the most effective and cost-efficient way to provide a telephone and digital connection(s) to large numbers of people is with two completely separate networks. Nobody in business runs phone and digital over the same copper. With the number of cheapskate businesses out there and dodgy operators willing to provide anything the customer wants, if this could work, we'd see it used. But we don't. Zero, zip, nada, nothing, not ever...

The copper in the telephone network isn't designed for high-bandwidth, nor digital. You wouldn't start from here if you had the chance: one pair of very low-quality copper cable with very poor high-frequency connections and jointing is not a sound base.

ADSL and VDSL work, but only by redefining "work", it's all a kludge and at best works poorly. If this was a car and you could see the nature of the work, you'd know it for the ultimate bodged job it is, not something you'd want to trust your life to.

There is a very good reason that in the last 15 years only two companies in Australia have installed VDSL/VDSL2. Both, TransACT and Adam Internet, started from scratch running to a total of ~10,000 subscribers. Both used brand-new cabling, and at least one, TransACT used high spec cable (cat 5, from what I saw).

Despite trying to make it work for 10 years, TransACT got sold for a fraction of its cost, never reaching break-even from what I've read. We'll never know how well Adam Internet was doing, Telstra bought the company in the last 12 months.

In the meantime, there have been 1-5 million ethernet "ports" sold, installed and upgraded in Australia. This is small & large enterprises, professional data networkers and cablers putting their money where their mouth is. (guesstimate, not verified)

If ADSL or VDSL was a technically desirable, or even feasible, solution, even by itself not as a hybrid, then we would see businesses using it on their internal networks. But they don't. That's a big message.

The complete lack of commercial application of ADSL/VDSL means every practising networking professional in Australia agrees on one thing:

ADSL/VDSL technologies are not cost-competitive nor considered "commercial quality", even when used standalone on brand-new high-spec cable. Trying to shoe-horn telephone, remote power and digital connections over a single pair on old, low-spec, poorly maintained copper is lunacy no professional would inflict on a commercial client, unless it was the last thing in the world.

Moving your phone  + ADSL services to a Node. Not so easy?

The technical cutover of your copper pair, the last 800m, to a node can probably be carried out without visiting your premise to test the line nor interrupting your current service, unless you're making a call. To do so require a lot of planning and preparation by skilled, competent technicians.

Your ADSL Internet connection will go down, but then you can reboot your modem and it'll Just Work.

That's the end of it, right?

No, it's just the start. We currently have over 6 completely separate telephone and broadband networks operating over the Telstra copper and their exchanges using ULLS, Unbundled Local Loop Services, agreements.

All those commercial players, including the dominant one, Telstra, are going to have their telephone and ADSL networks turned off and smashed into one big happy disaster zone.

Who's exchanges, phone services, messaging and 'feature codes' will be supported and used? Nobody's or Everybody's? Who's ADSL network design is going to be kept? How will billing be cut-over? How will fault-reporting and troubleshooting and maintenance be handled? And more headaches than that for NBN Co and the unsuspecting customer.

The hybrid, not pure-digital, Nodes that the Coalition wish to install have to do three different, incompatible things, not one (50V DC remote power, telephone, digital/ADSL), which means they have to somehow combine three services/signals of completely different nature, onto a single pair of wires. That requires extra complexity and a good deal more equipment and cost. It also causes each of the services to be less efficient than they need be. Everything is compromised by a hybrid approach.

We also have a name for these crazy "try to do everything" devices: RIMs.
Telstra has been deploying them since the mid-90's and has over 8,500 in service right now. They're BIG, they're ugly and expensive to install. They are also the only technology known to work in our conditions.

Is that the big Coalition plan? Ask Telstra to install RIMs everywhere? Is that why Turnbull is so sure they'll not just agree but charge him nothing, that he only says "They will"? A very terse and curious statement for one so voluble and verbose to the point of being prolix... Completely out of character.

The problem with all mass-migrations is that you know there will be mistakes and there will be more subtle and hard-to-find ones than you could ever guess beforehand. This is why competent engineers allow reasonable Project Contingencies, something apparently missing in the Coalition NBN plan.

Because there will be Errors, Faults and Failures in the cutover, every single service must be tested for all three services provided at the customer premises. Why? There is NO remote test gear there.

To confirm the cutover is "to spec" and problem-free requires a technician testing inside the Premises - going into the dwelling. Because connecting at the far-end of the drop-cable, or up the pole or in the pit outside the house, is not best-practice. No maybe the Coalition will skip this step and not care about finding and fixing the hundreds of thousands of faults that we know will happen when attempting to migrated 9M services.

The hard part is not the technical cutover, but the Commercial agreements, contracts and on-going Billing, Support and Maintenance

The Techs have left and you're connected to an NBN Co FTTN Node: your phone works, your ADSL2 service works, probably a bit faster, and you're a happy camper. It's all done, isn't it?

Not by a long shot.

Did you notice there is nothing there about the high-speed service the Coalition are spruiking: VDSL2. The "magic" that can push 100Mbps over really poor, unsuitable copper?

That's a completely different story. If you want to go there, you'll need to sign a new contract, buy your own VDSL2 modem (Adam Internet sells theirs for $150+ and in the UK you can pay nearly a $1,000 for high-end gear), but then you can't install it.

We don't know if NBN Co will mandate the use of a "Central Splitter" on their side of the wiring in your house or if you can self install new filters on every phone device you have. Your current ADSL1/2 filters aren't suitable, they are for different frequencies.

Judging by what Telstra charges now for a Technicians' home visit, you'll be up for between $300-$400 for that Central Splitter.

We don't know yet if the Coalition will allow NBN Co to offer a pure-digital version of their FTTN. This would give you a VDSL2 version of their NDT, Network Termination Device, in your house, identical to what is installed without charge for direct Fibre and Fixed Wireless subscribers. Satellite customers get something closer to a normal ADSL modem.

Nor do we know if FTTN subscribers will be singled out and charged for an NTD or not.

Back to your phone and ADSL2 service after it's changed over to a NBN Co Node.
NBN Co are wholesalers, you don't deal with them directly, but with your current supplier.

To have that phone & ADSL working now, you have two separate contracts with your ISP and Phone company. They've provided those services over their own equipment/network and, if not Telstra, paying for access to the Telstra copper line to your house as well.

But when your line is switched over to the NBN Co Node, all of that is turned off, even if you're with Telstra.

There are two direct consequences for you as a customer:

• The two retail contracts you have may be broken because if the retailer can no longer fulfil all their obligations in the same way (they're now dependant on someone else with different Service Level Agreements and obligations), and

• We will again be able to "churn" quickly and simply between retailers because all of them are using the same infrastructure and systems controlling it. You'll be able to swap to another Retailer and get different deals with a minimum of fuss.

There's a massive legal conundrum left:

If you have a contract with a Telco where you are obliged to pay phone-line rental and STD call charges, this has to be broken and rewritten to comply with Turnbull's quite bald & adamant statement: "There will be no line rental under the NBN Co"

So, what's your contract and legal obligation when the Techs have cutover your phone to the Coalitions' NBN Co Node? What will appear on your bill before that day, then after that day?

Will you have the option to enforce "no disruption" and stay with your previous contract? I doubt it.

Nobody knows, because Turnbull hasn't thought to clarify it. He's smart enough to have thought of this question and have constructed an answer and policy. It's being deliberately kept from us, which might imply "It's Bad News you don't want to hear."

What I can guarantee to you, is that Telstra, Optus and the other Telcos/ISPs will not accept the abolishment of phone-line rental charges without an equal or greater compensation.

I also challenge the Coalition's assertion "no disruption".

There has to be both an ADSL outage and a significant change to contracts, billing, charges and call rates.

What this means to you.

From the stream of on-line and media comments by people saying "I'm fine with what I've got", there will be a large cohort of consumers that will stay with exactly the same services they have now: phone + ADSL2, when they are swapped to a Node.

If you're paying around $30/month phone-line rental now, because the Telco's cannot be disadvantaged, you'll be paying at least that or more for FTTN services from the Coalition NBN.

Look for tricky, slippery wording about the new charges you will be forced to pay, the total must be higher, no matter what "Non Core Promises" Turnbull and the Coalition might make.

High Charges, Guaranteed.

The Coalition cannot argue a case that the whole bill for existing Phone + ADSL2 services can decrease:

• They are making NBN Co invest $8-$16 billion more. That cost has to be recovered.
• They have $11 billion in contractual payments to be made to Telstra
• They have assumed the maintenance for:
• For phone line, through the last 800m.
• Your ADSL service as well.
• the Node, its electronics, it power-supply and damage from vandals and accident
• the IT systems to control & provide all services
• the billing systems for both Phone and ADSL
• interfacing with all Retailer systems,
• the replacement telephone network, with all services, messaging, etc, and
• a completely new internal network to transport traffic back from the Nodes, through Exchanges and up to the Point of Interconnect

They cannot compensate Telcos for lost income and make these enormous technical & financial investments that won't appreciably lower running costs and claim they can do it for less.

Everything they're doing will cost money, but they are not saying how the extra money to pay for it will be raised.

Your new telephone bill won't have a line-item labelled "phone-line rental", but it will have an equivalent "service access charge" that must be larger. You might get a slightly faster service, but you'll pay more.

Because of the iron-laws of simple Arithmetic and Accounting, we know that your total bill has to be more than what you're paying now, otherwise NBN Co couldn't payback the build costs.

What you're paying now in phone-line rental will be increased, so that's a good starting point to estimate the minimum cost of the Coalition's FTTN NBN. If you want to use the "magic" VDSL2 service promised, that'll be more, a lot more, out of your pocket up-front, and every month.