Concerns the NBN's failing to address business needs
- 14 July, 2008 16:00
The federal opposition, telco analysts and industry players have signaled with varying degrees of caution that the level of services, options and pricing that Australian SOHO and SMEs will get out of the National Broadband Network is worryingly unclear.
The toughest criticism of Senator Conroy's RFP came from shadow communications minister Bruce Billson, who said Conroy's gag order has resulted in far too little discussion about what the NBN might deliver to consumers, including the 96 percent of Australia's 2, 011, 770 businesses that employ less than 20 people.
"For businesses, large and small, it is particularly difficult to anticipate what the NBN might offer. Likely new service offerings are often described in terms of file sharing, new entertainment offerings and more punch for current applications, with guesstimates on price and performance.
"This makes it extremely difficult for businesses to anticipate whether the business case for them will provide significant net benefits," Billson told Computerworld.
This was one of the reasons why the opposition launched a Senate Inquiry into the NBN RFP; to determine service availability, choice and costs; competition in services; and consequences for national productivity, investment, economic growth, cost of living and social capital for consumers, SOHOs and SMEs.
"It is unclear at this time whether the Rudd Government's approach to the NBN will enhance service, price and quality options for heavy data users or constrain them.
"Much depends on the yet-to-be-disclosed regulatory, competition and architectural arrangements that will accompany the NBN and so little is known about this, and [the federal] government's 'gag' orders are making open discussion about these factors even more difficult," he said.
Dr Paul Brooks of telco analyst Layer 10 Communications, said that most of the debate on the NBN so far has focused on residential broadband.
"In the business areas there hasn't really been a focus on what the NBN would bring for business users. The assumption seems to be that speeds people have postulated for [residential services] will be OK for business users," he said.
Large enterprises in metropolitan areas are currently well served by Fibre-to-the-Building, he said, but the potential needs of smaller businesses that do or are looking to deploy for example, IP or VPN type services, could miss out.
"It's the smaller businesses in residential areas -- people running businesses from home -- it's those organisations that may miss out on the wide variety of services that are typically offered to business customers... It will be interesting to see how the NBN network architecture deals with access to business services from homes," he said.
Page BreakTelarus MD Jules Rumsey, whose company has over 95 percent business customers, said there needs to be more discussion about how the NBN will deliver a range of services to business customers that is appropriate in terms of service speed, service quality, the nature of quality-of-service arrangements and how business applications will be supported across the new network.
He believes the debate has been too focused on the NBN as a concept and what it will deliver generally, rather than specifically looking at what it will deliver for businesses.
"Any of the organisations servicing businesses --Telarus, Optus, AAPT, Primus, Macquarie etc -- will be concerned. We have three different modes of delivery of services to businesses; copper access, fibre that is [currently] in place, and wireless. So we've still got alternatives, but a large number of our services are delivered over copper access so we are keen to drive that debate.
"There are a lot of business customers out there that will be impacted in the event that the NBN moves forward, particularly under the structure that we've seen to date from Telstra where the existing copper access network would basically be taken apart or dismantled, removing direct copper between the exchange and the customer's premise in favour of the new FttN network.
"So there is a real need to have a serious think about what will happen to business customers that have been using services across the copper access network to date," he said.
Rumsey points to the boom in unified communications as a key example of a critical service the NBN must be able to guarantee a high level of service quality.
"There's plenty of commentary about the size of SME businesses in Australia and how critical they are to the economy...any issue in terms of nature of service quality, speed, performance under an NBN, if its going to be at the expense of existing services, could have a substantial impact on those businesses and the Australian economy."
Optus' director of regulatory affairs, Andrew Sheridan, said there hasn't been a lot of talk about business benefits of the NBN which largely reflects the government's gag order, but warns that it represents a large chunk of the Australian economy and meeting their needs is essential to the success of the new network.
"They are an important market of likely users of this network. When you put your business case forward you want to look at how you can maximize the use of the network and that is an important group of customers that you really want to make sure you are meeting their needs," he said.
Senator Conroy's shadow, Bruce Billson, said the architecture of the NBN is critical for enterprises and competitive telcos that may have invested to provide FttP and may seek to combine this with copper-based services.
"In addition, telcos which have installed D-SLAMS to offer ADSL and VDSL broadband services or have invested in their own fibre backhaul must be terrified about the prospects of their investment and businesses being left 'dangling' if a future Fibre-to-the-Node (FTTN) build bypasses the current exchanges.
"If these exchanges are bypassed by an extended fibre build that uses a node or street-side cabinet replacement for pillars as the point of interconnection with the broader network, many current arrangements will need to be re-engineered, renegotiated or written-off if the NBN architecture is not accommodating of these pro-competitive investments.
"Broadband users with these kinds of interests need to be heard and we have to provide a platform for their voices via the Senate Inquiry," he said.
Billson also signaled grave concerns for regional, rural and remote Australians, especially businesses in those areas, who could have had metro-comparable broadband rolled out by the middle of next year before the Rudd Government cancelled the OPEL network.
"12Mbps may not be enough for some businesses and specific applications but a proper role for government investment and intervention is to first address the under-serviced community needs and that was what OPEL was about.
"With the reported huge cost and timeframe over-runs Senator Conroy is overseeing with his shambolic NBN approach, it is not surprising that wireless providers are ramping up their technologies with speeds and offers to soak up demand for higher speed broadband in rural and regional communities," he said.