NBN rollout on track

NBN Co, the government owned organisation responsible for building the NBN says that it has exceed its target to have construction commenced or completed in areas covering 758,000 premises before the end of 2012.

The total number of premises was 784,592 by year end, although NBN Co notes that construction commencement is measured when the company issues instructions to its contractors for a Fibre Service Access Module (FSAM), not when the contractor actually starts laying fibre.

The company did not say how many users had been connected to the NBN, which so far have been a disappointment. The company says it usually takes 12 months from the start of work until homes and businesses can connect.

In December last year, Communications Minister, Stephen Conroy said the take up rate was around 25%, or 1 in every 4 people. Opposition MP, Malcolm Turnbull has criticised the government suggesting that 75% of people haven’t been convinced to switch over, and the take-up rate is well below the NBN’s corporate plan released in 2010.

For telecommunications companies including the big four, Telstra Corporation (ASX: TLS), Optus – owned by Singapore Telecommunications (ASX: SGT), TPG Telecom (ASX: TPM) and iiNet Limited (ASX: IIN), the NBN offers an opportunity to provide faster services to their customers, but also a complication.

With wireless broadband services becoming ever popular, and the speed of 4G networks even outpacing copper ADSL broadband, users may opt to pass on fixed broadband, and use wireless instead. Despite the NBN’s predominantly fibre broadband being able to offer much higher speeds, users may choose the flexibility of wireless over speed.

Read More: http://finance.ninemsn.com.au/newsbusiness/motley/8591964/nbn-rollout-on-track

OPINION: National Broadband Network rollout proving to be a costly failure

IN April 2009, the Rudd-Gillard government announced its plans to build the National Broadband Network.

The fibre-optic network is supposed to pass 12.2 million premises around Australia by 2021.

More than three years later, as at June 30, 2012, it had passed just 38,914 – less than one third of 1 per cent towards the finish line.

Yet NBN Co’s corporate plan, issued in December 2010, promised to pass 317,000 premises by June 30, 2012. Another comparison: in 1994, Telstra announced it would build a national hybrid fibre coax network. By June 1997, three years on, the network passed 2.1 million homes.

NBN is doing equally badly on the number of services being delivered. There were 3867 fibre services in operation as at June 30, 2012; the corporate plan promised 137,000.

More recent disclosures at estimates hearings in October show little improvement. One component of the fibre rollout, brownfields, had risen from 29,000 in June to 32,295 and fibre services in operation were at 6400.

Broadband Minister Stephen Conroy and NBN Co have tried every trick in the book to disguise the poor performance. They abandoned the original corporate plan and issued a new one in August this year. The goal of 317,000 premises passed by June this year was changed to 39,000.

The goals for later years also dropped sharply. Originally the network was to pass 1.27 million premises by June 30 next year; that has fallen to 341,000.

Next, they made comparisons as difficult as possible. The original corporate plan gave target numbers for five different categories of premises: three types of fibre, wireless and satellite. The new plan, and the 2011-12 annual report released recently, now gives numbers for two types of fibre and a merged number for wireless and satellite.

Third, they tried to shift attention away from hard numbers by introducing a new statistic: premises where there is construction commenced or completed. NBN Co’s March 2012 media release promised that by 2015 “construction of the fibre optic component of the network will be under way or completed in areas containing 3.5 million premises”.

This statistic – which is not used by private sector telecommunications companies such as Telstra and Optus – is meaningless. They count a home as having construction commenced from the moment a contract instruction is issued to the contractor.

But several further steps are required, including the Telstra commencement notice and the final contract instruction. On average, it will be 12 months before the work is completed. A fourth trick is to quote total subscriber numbers across fibre, wireless and satellite.

At the October estimates hearing, NBN Co said it had 24,000 customers. But of these, 17,000 were on satellite – and more than half of them were customers of an existing government program, dating back to Howard government days, to subsidise satellite broadband in rural and remote areas.

The rollout is chewing up taxpayers’ money at an alarming rate. By June 30 this year, $2.832 billion of taxpayers’ money had been put into NBN as equity; of that more than $900 million had vapourised in three years of accumulated losses. (In 2011-12 alone, NBN Co lost $520m.)

Total equity contributions – entirely taxpayer funded – are projected to reach $30.4bn by 2021. This is almost $3bn more than the Rudd-Gillard government had previously disclosed.

NBN Co is splashing around money with abandon. It pays extremely generous salaries. Average remuneration cost per head was $172,000 in 2011-12, more than 50 per cent higher than the comparable figure at Telstra.

Read More: http://www.theaustralian.com.au/business/opinion/national-broadband-network-rollout-proving-to-be-a-costly-failure/story-e6frg9if-1226529240654

Optus set to take on Telstra in urban areas

Optus has shrugged off soft quarterly results and declared it can challenge Telstra for network supremacy in urban areas, as it prepares for legal mediation with its bitter rival over 4G-standard advertising.

In the Federal Court, Justice Stephen Rares has ordered senior executives from the two major forces of Australia’s telecommunications industry to attend talks on Friday amid a dispute over advertising for superfast 4G services.

The Australian Financial Review revealed in November that Optus, a subsidiary of locally listed Singapore Telecommunications, was attempting to force Telstra to drop its “network without equal” campaign after media testing showed the No. 2 carrier’s network was faster in many locations in the Sydney metro area.

The latest dispute centres on advertising claims Telstra had the only 4G network in Brisbane after Optus has activated the technology in the city.

Read More: http://www.afr.com/p/technology/optus_set_to_take_on_telstra_in_VIZtTY5ppAzPU5WBHFxUEJ

“We are committed to matching Telstra in metro network quality and will defend ourselves against misleading claims in advertising,” SingTel’s Australian consumer chief Kevin Russell said.

But the outbreak in hostilities coincided with the third straight decline in quarterly sales for Optus, forcing it to lower its full-year revenue guidance.

Telstra Signals Game On

Telstra (TLS) has raised the competition heat in the telecommunications sector with its purchase of Adelaide-based ISP Adam Internet, for an undisclosed sum. While only a small acquisition for the giant of the sector, it will make players in the middle tier of the broadband marketplace sit up and take notice, according to brokers. Most see it, with Telstra’s stated aim to run Adam as a separate entity, as a bid to challenge Optus ((SGT)), iiNet ((IIN)) and TPG Telecom ((TPM)). For RBS it is Telstra’s “Jetstar moment”, referring to Qantas’ ((QAN)) well-founded decision to run a budget airline, Jetstar, along side its premium service. For Deutsche, it reaffirms its view that organic growth in this area is difficult. Credit Suisse sees Adam as Telstra’s ‘challenger’ brand and believes it is a significant change for Telstra and the industry.

The acquisition price was not disclosed but speculation puts it at $50-60 million for around 80-100,000 subscribers. Therefore, the acquisition for Credit Suisse, on an 80,000 subscriber basis, implies an acquisition price of 10-12 times FY12 earnings and $550-$660 per subscriber. Credit Suisse believes the deal won’t provoke concerns at the Australian Competition and Consumer Commission, given Adam only has around 1.5% market share. RBS also notes, nationally, it would not be a material reduction in competition. However, Adam could have up to 20-25% of Adelaide subscribers and that may concern the ACCC.

Adam is seen operating as Telstra’s low cost online channel but benefiting from the infrastructure and balance sheet of Telstra. Credit Suisse says it is a sound strategic move by Telstra, giving it a lower-cost channel to minimise retail market share loss as the NBN rolls out over time. Nevertheless, there is risk, as Adam needs to gain presence outside its home market and not get bogged down by its big brother’s bureaucracy. The broker expects Adam to be positioned as a mid-tier operator going head to head with iiNet and Optus, rather than challenging the lower cost providers TPG and Dodo. The reason for this, Credit Suisse maintains, is that Telstra still has the number one retail broadband business (46% market share) and it would have a lot to lose by leading broadband prices down with the Adam brand. Optus and iiNet hold 18% and 15%, respectively, of the national broadband market share. However, in the metro broadband market, the broker estimates Optus and iiNet collectively hold 45%-50% market share. This, therefore, represents a significant opportunity for Telstra to challenge.

Read More: http://www.fnarena.com/index2.cfm?type=dsp_newsitem&n=96D30D3F-EDB5-F6C1-B051B4504DA38BE4

Telstra to rollout low cost internet

Telstra Corporation (ASX: TLS) appears to be making a play for low price internet customers, with its purchase today of budget internet provider, Adam Internet, for a reported $60 million.

Telstra plans to support Adam Internet to expand nationally, and the brand will be run as a stand-alone subsidiary of the company. Adam Internet currently has an estimated 90,000 broadband customers, and the acquisition meets Telstra’s strategy of retaining and growing customers, while building growth businesses.

The purchase came as a surprise to many, with most of the mergers and acquisitions in the IT and telecommunications sector coming from second tier companies like TPG Telecom (ASX: TPM) and iiNet Limited (ASX: IIN). Yesterday, Telstra announced a new retail alliance with Boost Mobile, a provider of pre-paid mobile products and services. Boost Mobile will market its products on the Telstra network from early next year, after Optus – owned by Singapore Telecommunications (ASX: SGT) announced that it would no longer licence services to Boost Mobile.

Read More: http://www.fool.com.au/2012/10/investing/telstra-to-rollout-low-cost-internet/

Stephen Conroy’s Public Lie On Internet Filter

Factual inaccuracy, fabrication, deceit, falsification or simply an outright lie. Whichever way you look at it, Stephen Conroy has told a blatant lie to the public in relation to the Internet Content Filtering project.

Delimiter.com.au is reporting that Communications Minister Stephen Conroy today told a lie by saying that Telstra and Optus had adhered to the government’s request by deploying a mandatory filtering process, when in fact, they had only implemented a significantly dumbed down voluntary version.

There have been no reports of any Australian Internet Service Provider using the government’s Internet content filtering system as suggested by Mr Conroy. Unless we’re all missing something here, it looks like the good minister either has become confused in a momentary lapse of reason or is just downright telling a lie.

Read more at Delimiter.com.au – Conroy misleads public on Internet filter


Regulate Telstra $11b NBN Pay Out says Optus

Optus CEO Paul O’Sullivan has suggested that conditions should be placed on what Telstra is allowed to use the $11b NBN windfall on.

Mr O’Sullivan indicated that there should be full transparency on what Telstra spends the money on in order to contribute to a level playing field and so that the incumbent cannot further monopolise the Telco industry.

“We’d like a level playing field so we can play a competitive game.”

“We think there should be full transparency. Where the money is spent should be accounted for,”– Optus CEO Paul O’Sullivan

Read more at the heraldsun.com.au – Optus wants conditions put on Telstra’s $11b NBN windfall

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Telstra to wholesale 3G mobile network services

Telstra are in advanced discussions with prospective wholesale customers that may witness other Telco’s use their 3G mobile network to sell 3G products and services within 3 months.

Up until now only Optus and Vodafone have struck agreements with other Telco providers to resell services across their mobile network. This has seen the likes of iiNet, Dodo and Internode all take advantage by offering respective products and services of their own.

It’s expected that the Telstra initiative will offer wholesalers the opportunity to resell 3G mobile services over their existing Next G mobile network however it’s highly unlikely that Telstra will additionally allow the wholesalers use of their ‘Next G’ brand name.

Read more at ZDNet.com.au

Optus 4G rollout announced for 2011

Optus have flagged April 2012 for the commencement of their 4G (fourth generation) mobile network. Operating over a 1800 MHz spectrum the new service is expected to bolster Optus broadband Internet speeds and alleviate network loads with Melbourne and Sydney first in line for the rollout whilst Perth is expected to be updated later that year.

The company has also announced further 2G and 3G development to existing networks that will encompass 500 new mobile towers and upgrades to 2,500 sites.

Telstra Trial FREE NBN in Tasmania Test

Telstra will conduct a three month free trial using the National Broadband Network infrastructure in Tasmania. It’s been revealed that Telstra BigPond will offer FREE next generation broadband services featuring their T-Box and T-Hub devices that they currently sell through their popular Telstra Bundles.

Bringing the tally of NBN Providers in Tasmania to 5, Telstra consider the respective state to be the perfect test bed for experimenting with various types of services and plans over the NBN which should give them a great insight into offering services on the mainland once the NBN becomes established there. Optus is yet to decide whether they will offer fibre to the home broadband services in Tasmania, however I would suspect that they will feel obliged to now that Telstra has raised their hand.

With iiNet, Primus, Internode, Exetel, Telstra and potentially Optus joining the race down under on the Tasmanian NBN, it certainly sets the scene for a interesting mini telecommunication battleground. With the NBN now looking certain to take shape nationwide, the Tasmanian first release sites of Midway Point, Smithton and Scottsdale are sure to be in for a treat of technology, innovation, competitive telcommunication prices and of course very fast broadband.

Search and compare Telstra Home Bundles via BigPond right here! 

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