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Australia - The National Broadband Network

Australia - The National Broadband Network

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Price $895.00
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Publisher BuddeComm
Date of Report Dec 7, 2010
Quick Overview
The decision from the Australian Government to launch a $43 billion national Fibre-to-the-Home broadband network is an unmistakable indication that there is a clear understanding that broadband is essential infrastructure. It fulfils a national purpose as its trans-sector multiplier effect delivers massive social and economic benefits in healthcare, education, energy and the environment.

A digital economy requires an open broadband infrastructure, and for that infrastructure to work it is essential that it be built by a national utility (NBN Co). There certainly are questions regarding the business model and the investment plan but widespread support exists for the visionary plan.

During 2010 the business model needs to be developed, taking into account the socio-economic benefits the infrastructure can deliver to the country. This report also provides an analysis of the progress of the project.

The most critical element to the success of the Australian National Broadband Network is the infrastructure company running the network, NBN Co. It has to make the critical architecture and design decisions that will form the basis of the new infrastructure for at least the next 25 years. It will be essential that the network will facilitate the vision laid down by the government, which includes multiple use of the network by other sectors such as healthcare, education, energy, etc.

At the same time the company will need to ensure that it remains an infrastructure company and doesn’t become another telco. The report also discusses issues around technologies such as Network Operation Centre (NOC), the Optical Network Terminal (ONT) and IPTV versus RF Video.

After the vision comes the actual design and rollout of the network.

Thanks to government leadership Australia was the first country to get the national purpose vision right. The USA soon followed and is now showing real leadership as well. The Netherlands and New Zealand also are on the right track. Economic and trans-sector innovations are now key items on the political agenda of these countries. However, when it comes to deployment there is no silver bullet and each unique situation generates its own set of unique implementation models.

Social and economic strategies need to be taken into account in the design and architecture of the infrastructure. Pragmatic solutions must be developed to maximise the use of existing infrastructure and other resources. Under-served areas need to receive priority and local communities and councils can play a key role in this. Wireless broadband can play a major role as well.

These early projects could also be an ideal testing ground for trans-sector applications and this report explores these areas at a high strategic level.

The National Broadband Network (NBN) will certainly change the game. While there will be a transition period where some of the old will remain activity will increasingly move to the new environment. This will see the players starting to realign themselves and in preparation of the new world many will start changing their business plans well before that time.

Nevertheless the government has published a far-reaching regulatory regime change that leaves no doubt that there will be no returning to the old days where the incumbent was able to game play the regime, creating endless delays and stifling competition. In the end the outcome of the new framework will be aligned with the goals of the NBN and negotiations and discussions are already taking place, aimed at shaping this new environment.

Australia will be the first country in the world in which the entire industry will adopt a new plan for the future. In the past strategies were based on ad hoc decisions and there was little room for long-term planning. The market survived on the crumbs that fell from the Telstra table, and on regulatory relief which often took many years to eventuate, and was often too late to help a starving competitive environment.

Uncertainty has been a major obstacle. All decisions depended on Telstra and there was little hope of individual initiatives. Those who developed their own independent plans quickly discovered that Telstra’s reach was long and deep. Good examples of this are TransACT in Canberra and the Unwired service. Even larger companies like Optus and AAPT (Telecom New Zealand) struggled to set their own course.

The single most important element of the NBN is that it will provide certainty about future direction. There will be problems, and the outcome will not be perfect, but for the first time individual companies are far more in charge of their own destiny.

Soon after the NBN was announced in April 2009 Telstra finally realised that changes were now inevitable.

It reacted swiftly.

A new management team was appointed led by the new CEO, David Thodey. Telstra immediately announced its support for the NBN and its willingness to work with the government. The company also put its weight behind the trans-sector concept which will be the road to generating new revenue.

Negotiations were commenced with the government, investigating how Telstra could best participate. These negotiations have been tough and very complex and they are continuing. An initial agreement to negotiate further was signed in December 2009, followed by the signing of a heads-of-agreement in June 2010.

The NBN being a political project, political activity will obviously be involved in the process. An extremely businesslike approach has been evident so far, but elections, pork-barrelling and new ministers and governments will no doubt have an influence on the NBN. Some of this will be positive, as a trans-sector approach will require the government to commit other government sectors to participate in the project. Thorough preparation will be necessary for a full national launch, but two large-scale projects were singled out to form a tangible start to the rollout. The rollout was commenced in Tasmania, where a new regional backbone network and the building of five test sites on the mainland commenced in early 2010.

Cities, regions and communities are now beginning to become involved in developing strategies that will enable them to take advantage of the social and economic benefits that the NBN can create.

It is therefore vitally important that cities take charge of the development of their knowledge-based environments. A proactive local government is a vital element in the deployment of broadband to the point where it can begin to deliver community benefits in education, healthcare, community services, job creation and export. To date lack of infrastructure has led to very limited action being taken either by state or local government in Australia – this is in stark contrast to events overseas.

This report discusses the NBN agenda that cities should develop and the strategies that should flow from it. It is essential that councils become actively involved in the National Broadband Network. The most active ones will most likely be the first cabs off the rank in relation to the deployment of the NBN.

As mentioned above, a trans-sector approach is essential for future progress. In this report we draw attention to the importance of looking across sectors to create synergy and BuddeComm has previously discussed at length the opportunities within the ICT industries of utilising new telecoms networks for e-health, e-education, smart grids (managing renewables, saving energy), etc.

The Australian Government is leading the world in trans-sector thinking. The report also discusses a new approach, which applies across infrastructure projects, and looks at the potential synergies between the building of roads, sewerage systems, water and gas pipe networks, as well as telecoms and electricity networks.

It covers government initiatives that have been announced since the National Broadband Network.

Recognising that a sound business model for the NBN would necessitate the participation of other sectors, in 2009 the government commenced the appropriate policy initiatives to confirm its trans-sector approach towards the NBN. It indicated that the NBN is a nation-building project – it will become a social highway – and there is a clear national purpose associated with it.

Initiatives are already being undertaken in the areas of smart grids, education and healthcare. Further action is expected to ensure that the business that will be generated from these sectors can be taken into account within the NBN business plan. This report provides an overview of the key sectors, plus an overview of the first trans-sector projects initiated by the government.

For more than a decade the traditional media has been on notice regarding the changes it will be facing with the developments in the digital media market.

So far they have failed to take decisive action, partly because they were afraid of cannibalisation and partly because their business models do not cater for swift business action. This has brought about a decline in their revenues but, far more importantly, they have failed to seize a share of the new market which is now dominated by newcomers such as Google, YouTube and Facebook.

The NBN is the next stage. Here again the media has largely been absent from this debate, but the NBN will create new changes, with new options. The traditional media players can take a leadership role, looking at the trans-sector opportunities the NBN has on offer – or they can simply copy their outdated models onto the NBN, perhaps by using the wholesale services of a telco.

Initial indications are that they are looking at more of the same, rather than moving towards media innovation. The media companies do have strong brands and millions of customers, but how can they utilise this advantage?

E-health may become an area where key killer applications which utilise truly high-speed broadband networks emerge.

As already mentioned, the Australian Government is a leader in strategic trans-sector thinking, linking e-health developments to the NBN. Early diagnosis and after-treatment patient monitoring are two areas where significant synergies may be found using applications provided to users at home.

As the financing of the public health systems in Australia becomes increasingly costly an opportunity exists to lower costs through more effective use of web services for healthcare consumers. With widely available and cost-effective high-speed broadband infrastructure, e-health is enabling customers to benefit from advances in medical technology and medical services.

While broader economic conditions in Australia may be subdued until 2011, spending on e-health solutions is likely to be boosted as part of the larger economic stimulus packages the government is currently enacting.

There will also be a dramatic increase in the use of IT and telecommunications technology within educational environments between 2010 and 2015 as high-speed fibre-based broadband becomes widely available in Australia. Simultaneously, the capability of Internet services in relation to e-education is set to increase enormously over the next decade as well.

With its large landmass and relatively small population Australia is an ideal market for remote education services. As such Australia is home to many successful e-education service providers, as well as being a relatively important market for e-education services.

The Australian Government already provides its citizens with relatively sophisticated e-government services and, as with education, the establishment of a fibre-based broadband network may see the government improve and broaden the range of web services for which it is responsible. Australia, therefore, is a fascinating and relatively advanced market for both e-education and e-government services. This report discusses related telecommunications infrastructure developments as well as trends and innovation related to the e-education and e-government services.

Many exciting developments will take place in 2010 in the area of smart grids. Towards the end of 2010 the outline of Australia’s first smart grid project should become visible, and over the next three years important insight will be gained for a national rollout.

These developments will also stimulate others to move on from demonstration projects, and to proceed from smart meter rollouts towards smart grids.

The initial results of this process will become evident in several projects being carried out in Victoria. That state took the lead in smart meters, and this encouraged many other utilities to also focus on their underlying infrastructure. As a result we will start seeing their various types of smart grids arrive in Australia in 2010.

There will be further pressure on the government to better align energy and environmental policies, as well as electricity regulations. The government can use its influence in this area to encourage electricity utilities to also invest in smart grids, rather than in smart meters alone.

Events that started in Australia in 2005 have grown into an international groundswell, with BuddeComm involved as a leading consultant with governments in USA, UK, Netherlands, Australia and New Zealand, as well as with the United Nations (ITU/UNESCO). The key to the concept is to release untapped social and economic benefits by using broadband as an affordable utility infrastructure to deliver a range of trans-sector services (healthcare, education, smart grids, etc). The industry has been working on the applications for over a decade but only with strong government leadership can the benefits be realised.
Table of Contents
1. National Broadband Network Overview and Analysis
1.1 Details of the government’s proposal
1.2 Implementation issues
1.2.1 Fundamental change to the economy
1.2.2 People issues
1.2.3 Business modelling – the key to success of the NBN
1.2.4 Recommendations Implementation Study
1.3 Socio-economic benefits
1.4 Regional broadband
1.4.1 Why we started the NBN in the first place
1.4.2 Where are our regional politicians?
1.4.3 Action plan
1.5 Where is the user in all of this?
1.6 Analyses of developments during 2009 and 2010
1.6.1 Trans-sector commitment to NBN is one step closer (June 2010)
1.6.2 Coordination of the various NBN segments (May 2010)
1.6.3 R&D missing out on NBN benefits (February 2010)
1.6.4 NBN passed through Parliament (October 2009)
1.6.5 Business getting in charge of the Australian NBN (August 2009)
1.6.6 NBN is moving in the right direction (July)
1.7 Opposition broadband policies
1.7.1 First glimpse of policies
1.7.2 Analysis of the Australian Opposition’s broadband policies
2. National Broadband Network Corporation (NBN Co)
2.1 An infrastructure company
2.2 The role of NBN Co
2.3 Service Oriented Architecture
2.4 Governance and Management of the NBN Co
2.5 Testing network design in first release sites
2.6 Network Operations Centre for NBN
2.7 Open network = innovation and affordability
2.8 Infrastructure Considerations
2.8.1 Collaborative Services Network concept
2.8.2 Smart Grids and the NBN
2.9 The network Plan
2.9.1 Overall design and architecture
2.9.2 The backhaul Network
2.10 External analysis of the Australian FttH architecture
2.11 Fibre Deployment Bill
2.12 The Infrastructure
2.12.1 Basic infrastructure
2.12.2 The copper network
2.12.3 FttH infrastructure
2.12.4 Wireless infrastructure
2.13 Technology issues
2.13.1 The Optical Network Terminal (ONT)
2.13.2 IPTV versus IPTV+RF
3. Deployment Strategies
3.1 Wholesale
3.1.1 Robust regime based on previous experiences
3.1.2 What about existing FttH users?
3.1.3 NBN pricing infrastructure not telco-based
3.1.4 Rolling out the NBN
3.1.5 Telstra to trial copper-fibre transfer
3.1.6 Regionalised rollouts
3.1.7 Wireless broadband for rapid deployment
3.1.8 Other quick-win areas
3.1.9 Deployment requires intelligent approach towards measurement
3.1.10 Massive increase in efficiency, productivity and customer satisfaction
3.1.11 Privacy is paramount
4. Competition and Regulations
4.1 OECD gives Australia’s telecoms policy the thumbs up
4.2 Regulatory issues
4.2.1 ACCC’s involvement in the NBN
4.3 Administrative and Regulatory support
4.4 Regulations - critical considerations
4.4.1 Learning form other models
4.4.2 Reform delusions
4.4.3 New proposal: USO Co
4.5 Regulatory telco reforms
4.5.1 Competition models and opportunities
4.5.2 Retail telcos modelled on media marketing
4.5.3 Niche markets
4.5.4 The Mobile industry
5. Industry at Crossroads
5.1 Quo vadis?
5.2 NBN opportunities for the main players
5.2.1 Telstra
5.2.2 Optus
5.2.3 AAPT/Telecom New Zealand
5.2.4 Macquarie Telecom
5.2.5 Primus Telecom
5.2.6 Internode
5.2.7 iiNet
5.2.8 Amcom
5.2.9 TransACT
5.2.10 M2
6. Telstra
6.1 Telstra and government agree on NBN future
6.1.1 Heads of agreement signed in June 2010
6.1.2 Analysis of the agreement
6.1.3 History of the deal
6.2 The new Telstra?
6.2.1 Introduction
6.3 BuddeComm and Telstra
6.4 Telstra – where to go from here? – November 2009
6.5 Telstra’s shareholders issue – October 2009
6.5.1 Looking after shareholders means looking after their future
6.5.2 Profits will come from growing the telco pie
6.5.3 Government supports socio-economic benefits
6.5.4 Shareholders’ ignorance
6.5.5 Nevertheless they will be winners
6.5.6 Highly focussed management needed
7. Early Projects
7.1 Co-development of fibre and the digital economy
7.2 Examples of FttH applications
7.2.1 E-Health
7.2.2 E-Education
7.2.3 Metering and remote sensing
7.2.4 Remote diagnostics
7.3 The early NBN projects – Roll outs
7.3.1 Introduction
7.3.2 Tasmania starts first phase of NBN rollout
7.3.3 Backbone rollouts in regional Australia
7.3.4 First sites mainland NBN roll outs
7.4 The early NBN projects – Trans-sector services
7.4.1 Project for social services
7.4.2 Adelaide blackspots receiving high-speed broadband
7.5 Business applications
8. Municipal Networks
8.1 Trans-sector thinking and Municipal Broadband
8.1.1 What is trans-sector thinking?
8.2 Local Government
8.3 Municipal broadband
8.3.1 Social and economic benefits
8.3.2 Why should local government be involved
8.3.3 High-speed communities
8.4 Cities are taking charge
8.4.1 Introduction
8.4.2 Global lessons
8.5 How to get started
8.5.1 The local council model
8.5.2 Framework for local government policies
8.5.3 Steering committees
8.5.4 Proactive local governments are essential
8.5.5 Broadband rollouts
8.6 How to move forward
8.6.1 Quality and affordability
8.6.2 Australian market has been on hold for five years
8.6.3 Industry is ready to deliver applications
8.6.4 Case studies from Wagga Wagga and Port Macquarie
8.7 A City Broadband Agenda
8.8 Broadband education
8.9 City marketing
8.9.1 The concept of Telematica
8.9.2 Three strategic elements of Telematica
8.10 Examples of tele-cities
9. Trans-sector Model
9.1 Trans-sector awareness update 2010
9.1.1 Sectors are starting to understand the benefits
9.1.2 Commitment from the Prime Minister
9.1.3 The NBN can pay for itself
9.2 E-Services in the context of national broadband
9.3 Introduction to trans-sector thinking
9.3.1 Fragmented society requires cohesive leadership
9.3.2 Problems in most silos
9.3.3 National welfare depends on new ways of thinking
9.4 A matter of leadership
9.4.1 Obama’s leadership - a catalyst for change
9.4.2 Digital Economy Industry Working Group (DEIWG)
9.4.3 Work in progress: political leadership
9.4.4 Trans-sector thinking at highest levels in Australia
9.4.5 Towards trans-sector government
9.5 Barriers to broadband adoption
9.6 We lack the structures to implement trans-sector visions
9.7 Multiplier effect for the NBN
9.8 Trans-sector regulation
9.8.1 Regulations need to be rewritten
9.8.2 FttH will change telecom models
9.8.3 Utilities-based regulation
9.8.4 Taking away blockages
10. Trans-sector Projects
10.1 The key sectors
10.1.1 Telecommunications
10.1.2 Media
10.1.3 Government communication and information
10.1.4 Healthcare
10.1.5 E-education and E-science
10.1.6 Smart grids
10.1.7 Business
10.2 Major trans-sector NBN projects
10.2.1 E-education - Australia’s first trans-sector initiative
10.2.2 Trans-sector project: smart grid/smart city
10.2.3 Trans-sector project for social services
10.2.4 Smart infrastructure
10.2.5 Trans-sector project e-health
10.2.6 Broadband trial of trans-sector applications
10.3 Smart communities and smart buildings
10.3.1 Smart communities - where to start?
10.4 Cloud computing
10.4.1 Introduction to Cloud Computing
10.4.2 Cloud Computing generates huge interest
10.4.3 Cloud Computing requires business strategies
10.4.4 Cloud Computing in the trans-sector context
11. Changing the Media Model
11.1 Open wholesale network key to change
11.2 Industry wants wrong piece of the NBN action
11.3 Industry needs to start changing
11.4 New business models
11.5 Breaking out of the silo
11.6 Trans-sector thinking
11.7 Media companies well-positioned to operate trans-sectorally
11.8 Risk will be unavoidable – not taking it will be deadly
12. E-Health
12.1 E-health in the context of BuddeComm research
12.2 Introduction e-health
12.2.1 Definitions, overview, challenges
12.2.2 Healthcare challenges
12.2.3 E-health: start with the professionals
12.3 Government view on e-health and the NBN
12.3.1 Broadband supported ICT key to e-health
12.3.2 Strategic trans-sector thinking
12.3.3 Broadband-based healthcare solutions
12.3.4 Large financial benefits
12.3.5 The economic multiplier effect of infrastructure
12.3.6 Market led by an enabling government
12.3.7 From pilots and project to national implementation
12.3.8 Digital economy benefits
12.4 The national health reform
12.4.1 Introduction
12.4.2 E-health high on the agenda
12.4.3 E-health identifiers
12.5 Critical e-health assessment from Booz & Company
12.5.1 Key conclusions
12.6 E-health - key to the success of NBN - analysis
12.6.1 Support collaborative services concept
12.6.2 Patients will have a central role
12.6.3 Intelligent personalised e-health
12.6.4 Accountability and transparency
12.6.5 NBN key to national e-health
12.7 Public healthcare projects and pilots
12.7.1 E-health Neuroscience project
12.7.2 Broadband enabling better chronic disease management
12.7.3 HealthInsite
12.7.4 Australian Health Information Council
12.7.5 Clever Networks programs
12.7.6 Digital Regions Initiative
12.7.7 Other public initiatives
12.8 R&D Projects and initiatives
12.8.1 Melbourne University
12.8.2 NICTA
12.9 Private initiatives
12.9.1 E-health in the private hospital sector
12.9.2 iSOFT
12.9.3 E-prescriptions – ArgusConnect, PSLnet and Medseed
12.9.4 Aged care and comprehensive medical assessments – HealthCube
12.9.5 E-health trial in Queensland – Data#3
12.9.6 Fibre for greenfield projects - Access Health
12.9.7 South Australian Internet health record system – emerging systems
12.9.8 Remote diagnosis – Kestrel Computing
12.9.9 Video consults – Cisco
12.9.10 Home care monitoring
12.9.11 Patient e-health monitoring service
12.9.12 Electronic health records – Smart Health Solutions
12.9.13 Telstra’s e-health initiatives
12.9.14 Mobile e-health for aged carers
13. E-Education and E-Government
13.1 Education and the need for NBN
13.2 New vision for e-education: 1:1 education
13.2.1 Australia’s first trans-sector initiative
13.2.2 A standardised e-education system
13.2.3 Risk of failure – people, not technology
13.2.4 Interactive and personalised education system
13.2.5 Expanding the teaching profession
13.2.6 From medieval schools to a digital society
13.2.7 It is all about economic benefits
13.3 Remote laptops from OLPC
13.4 E-education infrastructure initiatives
13.4.1 National government policy - FttH to the schools
13.4.2 A national broadband network for Catholic schools
13.5 E-education content in Australia
13.5.1 Australia’s largest online library
13.5.2 E-learning from ACS
13.5.3 Media literacy
13.6 E-government
13.6.1 Survey on e-government services usage
13.6.2 Conclusions
13.6.3 Government deploys national TelePresence system
14. Smart Grids
14.1 Smart grids and the NBN
14.1.1 Introduction
14.1.2 Exploring synergies and opportunities
14.1.3 Using electricity infrastructure to roll out broadband
14.1.4 NBN and smart infrastructure
14.2 Other trends in 2010
14.2.1 Price of electricity to double
14.2.2 The Prime Minister on smart grids
14.2.3 Meters in Victoria not so smart
14.2.4 Smart grid: $5 billion in annual benefits
14.2.5 Electricity industry still not sure about smart grid
14.2.6 Smart grids and CO2 emission savings
14.3 Where are we in Australia in 2010?
14.3.1 Can we develop a holistic policy?
14.3.2 Smart grid concept gathering momentum
14.3.3 Smart grids require policy changes
14.4 Regulatory framework
14.4.1 Action needed
14.4.2 Facilitating smart grids
14.4.3 International benchmarks
14.4.4 New spectrum proposal boost for smart grids
14.5 ICT solutions for global warming and energy saving
14.6 Industry issues
14.6.1 Utilities need to be modernised
14.6.2 Technology solutions need to be followed through
14.6.3 The need for trans-sector approach
15. BuddeComm’s International Broadband and Trans-sector Activities
15.1 The concept
15.1.1 The birth of trans-sector concept
15.1.2 Australia - one of the first countries to develop trans-sector policies
15.1.3 Smart grid and NBN first trans-sector project
15.1.4 Support from Obama and the FCC
15.1.5 Trans-sector innovations in the Netherlands
15.1.6 United Nations puts its weight behind trans-sector
15.1.7 OECD report
15.1.8 BuddeComm proud of playing its part
16. Glossary of Abbreviations
Exhibit 1 – Key applications of a digital economy
Exhibit 2 – Trans-sector benefits
Exhibit 3 – Case study – the social and economic benefits of broadband
Exhibit 4 – Key broadbanding steps
Exhibit 5 – Some application bit rates
Exhibit 6 – Smart Homes
Exhibit 7 – Definition: Cloud computing
Exhibit 8 – Amazon Web Services
Exhibit 9 – Costs of e-health plan
Exhibit 10 – Funding for e-records