Australia going all-in with its government-run fiber network

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The Reaper
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Australia going all-in with its government-run fiber network

Postby The Reaper » Tue Jun 22, 2010 2:42 am UTC

http://arstechnica.com/tech-policy/news ... mpaign=rss
Australia's going all-in with its government-run fiber network. The government has now convinced the country's dominant telco, Telstra, to sign on with the scheme, get rid of its copper and cable lines, and transition its subscribers to the open-access national fiber program. When the project is complete, Australia will have taken an almost unprecedented step for a country of its size: legacy telecommunications infrastructure will be almost gone.

Although Australia had planned to move forward with its AUS$43 billion fiber network with or without Telstra, Telstra's decision to join the party is a significant one—the company could have held out and fought to keep its customers from defecting to fiber, setting the stage for a long platform war. In the end, though, there just weren't many benefits to doing this; a recent report from McKinsey and KPMG reemphasized the fact that the new fiber buildout would "accelerate the evolution of the industry," and it would be hard to compete with open-access fiber-to-the-home on speed.

Telstra could hardly afford not to become part of Australia's future, which is why it penned the deal with the government after a year of negotiations. For AU$9 billion, Telstra agreed to transfer all of its customers away from copper and cable and onto the new fiber network; it also opened all of its ducts and existing fiber backhaul to the government for its use.

In the end, Australia will have an open-access fiber network that reaches most homes in the country, with the rest served most by high-speed wireless (12Mbps minimum) and a few isolated places with new higher-speed satellites. The fiber network will be run as a pure infrastructure company that leases out access to any ISP who wants it at nondiscriminatory rates, paving the way for major competition in the ISP space.

Australia's Minister for Communications, Stephen Conroy, praised the deal by saying that Telstra's participation will mean the government can reduce the overall cost of building out the network. "This is an important step in the delivery of the single largest nation building infrastructure project in Australian history, which will increase national productivity and help build a stronger economy," Conroy's office said in a statement.

The deal is not quite done yet, as the government must first sort out binding agreements with Telstra that must then be approved by shareholders. Once it is approved—and there's not much reason not to be—the government will take over Telstra's phone services, payphones, and emergency call services until the new system is in place.

From other parts of the world, regulators often watch the US telecommunications market in amazement, shocked that ISPs and phone companies so aggressively challenge every FCC decision and Congressional bill they don't like. Even asking Comcast to stop blocking P2P traffic was met with a lawsuit.

Indeed, it's almost impossible to imagine something like this happening in America, with the government going to AT&T, announcing that it's building a massive fiber network that will make the copper telephone lines obsolete, and that AT&T can join it or die a slow death in the marketplace. (See the recent National Broadband Plan for evidence of the FCC's almost total lack of interest in trying to spur ISPs to do big things.)

There are some good reasons for these differences, and the US market isn't like Australia's; fiber is more widely deployed here by companies like Verizon (to the home) and AT&T (to the node), while widespread DOCSIS 3.0 cable systems increasingly offer 50 and 100Mbps speeds.

But it's still not hard to watch what Australia has decided to do with something like awe; in essence, it is making Google's dream of high-speed, widespread, open-access fiber a reality, and it's willing to browbeat even the largest telco in the country into compliance with the plan.

I thought this was an interesting development, so I figured I'd share.

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Eseell
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Re: Australia going all-in with its government-run fiber net

Postby Eseell » Tue Jun 22, 2010 4:12 am UTC

On the one hand, there's a lot of really neat stuff you can do with fiber. Once it's run, you can put all kinds of services on it. Since you can often upgrade high quality single-mode fiber to better data rates just by upgrading the equipment on either end of the line this has the potential to build a lasting and hugely useful information infrastructure for Australia. As 40G and 100Gbps-rate technology, frequency stacking and other WDM methods get cheaper over the next few decades it's conceivable that the same fiber being run to homes now could be used for a very long time in the same way that copper has been, all the while providing service at increasing data rates.

On the other hand, it could very well suck to be the ISPs that are beholden to the government for taking all that money. It would be difficult to, say, refuse to participate in a government-run censorship/monitoring scheme when said government paid for your entire infrastructure.

It's cool, though, because the Australian government would never do that, right?
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Sharlos
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Re: Australia going all-in with its government-run fiber net

Postby Sharlos » Tue Jun 22, 2010 4:32 am UTC

It's worth mentioning that Telstra used to be a government owned company tasked with providing telephone services to everyone in the country as well as emergency call centers ect. Once the previous government decided to privatise the company with a monopoly over Australia's telecommunications network (nothing could go wrong right?) almost all Australian ISPs now had to purchase wholesale services form their competitor in order to work.

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Indon
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Re: Australia going all-in with its government-run fiber net

Postby Indon » Tue Jun 22, 2010 12:22 pm UTC

Australia's going to have the best internet that can't be used the world has ever seen.
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Argency
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Re: Australia going all-in with its government-run fiber net

Postby Argency » Tue Jun 22, 2010 12:32 pm UTC

Well, that's pretty awesome. Personally I'm excited for the filter to come in - I can't wait to see how poorly it works, and how widespread the civil disobedience is.
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Hawknc
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Re: Australia going all-in with its government-run fiber net

Postby Hawknc » Tue Jun 22, 2010 12:41 pm UTC

Indon wrote:Australia's going to have the best internet that can't be used the world has ever seen.


God, I wish you were joking. Related article is, sadly, related.

In principle, I have no problem with Telstra coming on board and working with the government on the FTTH plan. Privatisation of it was a terrible idea in the first place, because it not only included the telco services but also put the communications infrastructure of the entire nation in the hands of a single company. Imagine privatising a train system, but then also selling the tracks to one of the train operators, so they can charge other operators for using them. It is a true monopoly and we've suffered for it with a lack of investment in decent broadband and, until recently, terrible service to regional communities. I just worry that the government that will own the NBN when it rolls out is the same government that is enacting censorship and "security" regimes driven by fundamentalism, fear and ignorance.

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Sockmonkey
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Re: Australia going all-in with its government-run fiber net

Postby Sockmonkey » Tue Jun 22, 2010 5:35 pm UTC

The paranoid side of me wonders if the censorship is the real reason behind this.


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