One of the most interesting features of this week’s alternative NBN plan published by the Australian opposition (see my article Australia’s NBN becomes a political football on Telecom TV) is this notion of “on-demand FTTP”.
On paper, there’s a lot to be said for this concept. Basically, the operator (public or private) deploys Fiber to the Node, but a consumer can pay to get Fiber to the Premises if they really want it. This feature is not unique to the alternative NBN proposal, it’s also being trialled by BT in the UK as highlighted in this article. What’s interesting about the concept is that in theory it addresses the demand issue. In a nutshell, we’ll deliver “better broadband” to you for free, but if you really want “kick-ass broadband”, you can pay extra to get it.
Except it’s a technically absurd concept, for two reasons:
- firstly, because the costs of FTTP deployment that are commonly considered (say around €1000 per home in dense urban areas) are mass deployment costs. These costs can be met when you send teams on the field to connect every home. If you send teams on the field to connect one home, the costs are much much higher. Just look at how much large businesses are paying to connect their premises: it’s in the tens of thousands of euros. Presumably, there’s a comfortable margin built into that price, but it still gives a sense of what the real cost would be.
- secondly, and very ironically, both BT and the Australian NBN chose point to multipoint architectures. That means that if a customer was to ask for an FTTP connection in a given area, the whole active equipment chain from the customer’s ONT to the splitter to the OLT would have to be activated for a single customer. The costs of that are absolutely prohibitive.
And I won’t even mention the network management absurdity of maintaining two parallel infrastructures, one of which only serves a very small number of customers.
On-demand FTTP is a fallacy. It will either never materialize or be priced in such a way as to convince customers not to take it. The reason it’s being put forward is purely as a marketing argument for BT and the Australian opposition to be able to say “those that really want it will be able to get it”.
Not unless they’re filthy rich, they won’t…