Simon HackettSimon Hackett argues that  Telstra's Fibre To The Node (FTTN) - which the giant telco walked away from last year - was designed to strand the investments of its competitors and turn the broadband services competition clock back to 1996. Simon, the managing director of national broadband trailblazer Internode and network infrastructructure pioneer Agile Communications, first published this article about the history of ADSL broadband in Australia on his blog

FTTN is dead, long live FTTN This isn’t very subtle, but then again neither is the extent to which Telstra has wasted the time, energy and money of a great number of people for the last year.

On the 7th of August 2006, the experience of seeing Telstra deciding to take its bat and go home after a year of vacillation tells us many things about the reality of FTTN.

You can find pointers to the Telstra announcements related to this decision here:
Telstra FTTN was designed to strand the investments of its competitors and turn the broadband services competition clock back to 1996.

This whole farce has had little or nothing to do with consumer benefit - because through this entire period, Telstra has limited its own retail customers (and its wholesale ones) to 1.5Mb/s, on the ADSL ports it has deployed nationally. Not withstanding that even the oldest of its own ports is capable of up to 8Mb/s downstream, and has been capable of that since their first deployment in 1999.

Its own customers have been held to ransom by its political posturing for this entire period.

The reality of 'FTTN', for current customers of one of its retail ADSL2+ competitors, such as Internode, would have been:  A halving in speed, a price rise, and a lock-in to BigPond as their only choice of DSLAM hardware provider.

It would have meant a return to the model-T era of 1999-2000, a time when you could have any choice of retail ADSL provider as long as it was expensive, coloured black, and boring as hell.

So what have we learned from this? We have learned that:

  • Telstra feels so vulnerable to the impact of its competitors that its won't make the same investments the rest of the industry is already making, unless it is specially protected from competition, above and beyond the structural advantages it already enjoys as a fixed line monopoly
  • Telstra is so disinterested in servicing regional Australia, and so afraid of fair competition, that it rejected a viable and detailed proposal from the G9, out of hand, which would have seen additional investment, wider geographic coverage, and future proofing of its proposed investment
  • Telstra is so committed to using monopoly power as a substitute for technical innovation, and as a way to maintain its market position, that it'd rather do nothing for a year rather than release the higher speed services it is able to release, immediately, on existing infrastructure.

Meanwhile, for that same year, the more nimble of Telstra’s competitors have been getting on with rolling out up to 24Mb/s ADSL2+ services around Australia, and they continue to do so.

Had FTTN succeeded, (as we all learned on 7th August), the entire plan for FTTN was predicated on the designed-in total destruction of the ULLS access regime.

In other words, FTTN would have meant the total destruction of 100% of competitors’ access to copper infrastructure for broadband. All competitors’ investments and infrastructure (and their customers’ services) would have been physically disconnected and stranded completely.

It would have been the return of the Telco dark ages before 1997 - permanently.

Fortunately, sanity has prevailed at last, and the rest of us can get on with innovating in ways that seem beyond the capacity of Telstra to manage, without the spectre of those investments (and the advanced services being enjoyed by our customers - now) being destroyed by the FTTN deployment model of Telstra.

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