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Assessing the NBN rollout &

the opportunity the NBN presents the telecom industry

Tony Brown

NBN Co

Ovum 2020 Summit

Sydney – October 31st 2014

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NBN Co – Where we are at

• 1Q15 results show revenue + customer growth

• Serviceable homes up 16% QoQ to 640,000

• End-users up 27% QoQ to 267,000

• ARPU grew to $39 – up 4% since June

• Solid progress made to reach 1 million

serviceable homes by end-FY15

• On track to reach 480,000 end-users at FY15

• MTM implementation under way

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Our goals

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The NBN – Why do we need it?

• Broadband is becoming essential service –

universal availability is important.

• DOC ‘Broadband Availability’ report* showed

very uneven quality of broadband services.

• DOC report showed 0.7 million HH could get

no fixed-broadband services.

• Further 920,000 HH on sub 4.8Mbps and 3.7

million HH on sub 9Mbps.

• 3.1 million HH (28% of all homes) have access

to 25Mbps – 110Mbps.

Department of Communications, Broadband Availability and Quality Report, published December 2014 -

http://www.communications.gov.au/__data/assets/pdf_file/0018/212535/Broadband_Availability_and_Quality_Report.pdf

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The NBN – What will it do?

• Create a level playing field in retail BB market

• Aims to equalise access to good quality

broadband and help close the digital divide

• Deliver platform for innovative new services

for residential and business segment.

• Create more opportunities for Tele-Working

• New business opportunities for SME segment

• New ways of delivering education, healthcare

and other societal services.

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The Move to the MTM

• MTM to utilise existing network assets

• Aim to deliver ‘faster and more affordably’

• Need to stay in $29.4 billion funding footprint

• Current plan is FTTP 24%, FTTN 42%, HFC

28%, Fixed-Wireless + Satellite 6%

• Aim is for 8 million premises to have up to

25Mbps by 2020

• Most fixed-broadband homes will have

between 50Mbps-100Mbps

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FTTP: Still moving ahead

• FTTP network passes 554,00 premises –

471,500 premises serviceable

• NBN Co has 211,000 active FTTP subs – total

network will serve around 3 million premises.

• Rollout faced several key challenges – with

unusable LICs a substantial issue

• Still working on finding FTTP efficiencies

• Improving contractor management

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Fixed-Wireless: The quiet achiever

• Highest satisfaction of all NBN end-users

• Fixed-Wireless subs record 7.9/10 in

overall satisfaction and NPS of +35

• 23,600 Fixed-Wireless subs activated at

mid-October – up from 6,500 at end-2013

• 500 BTS activated – covering 130,000

premises

• NBN Co will build 2,700 BTS in total covering

600,000 premises

• Top speed of 25/5Mbps – but higher speed

services are a possibility.

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Fixed-Wireless: The quiet achiever

• Fixed-Wireless service is delivering world-class

services to regional and rural areas.

• Fixed-Wireless BTS can deliver 25/5Mbps

services up to 14kms distance.

• Subs very happy with installation process –

normally 10-19 business days from order.

• Subs more likely to rate their new internet

experience as much better compared to their

previous service.

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Satellite: LTSS – Nearly there now!

• Services currently provided by ISS

• LTSS will begin with NBN Co -1A

• Launch due 1H15 by Arianespace

• Payload performance testing complete

• NBN Co -1B planned launch in 2H15

• 9 Satellite Ground Stations complete

• LTSS will aim to deliver world-class remote

broadband services

• LTSS opens up new opportunities for NBN Co

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FTTB: Solving the MDU problem

• FTTB pilot services began in Victoria in March

• Pilots held in 8 MDUs with three RSPs

• Around 40 premises involved in trial

• End-users got peak speeds of 100/45Mbps

• High level of customer satisfaction in pilot

• FTTB can help speed up MDU rollout

• NBN Co commercial FTTB services

planned to launch in 1Q15

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FTTN: Trials building up steam

• Successful FTTN pilot held in Umina

with around 50 end-users

• Achieved peak speeds of 100Mbps/30Mbps

• Now moving to expanded FTTN trials in

NSW and SE QLD

• 1000-Node FTTN trial with Telstra and

NBN Co to deliver our own 300-Node trial

• Combined trials cover 244,000 premises

• Commercial FTTN launch in 3Q15

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HFC: Preparing the way

• Telstra & Optus negotiations continue –

scope and timelines being locked down

• Dennis Steiger appointed head of HFC division

– reporting direct to Bill Morrow

• First RFP for CMTS has been released -

winning vendor announced in November

• RFP for outside plant & equipment launched -

winning vendor announced in December.

• 2.5 million of 3.4 million premises in HFC

footprint already have co-ax lead-in

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VDSL/HFC: Gigabit pathways ahead

• European ops already commercially

deploying VDSL Vectoring

• ITU close to standardizing G.Fast – we are

reviewing this internally for FTTdP

• BT, Swisscom, Eircom, Telecom Italia,

A1 and more all trialing G.Fast

• Ops moving towards hybrid-broadband

• US MSO’s aggressive on DOCSIS 3.1 launch

• Era of ‘Gigabit Cable’ is looming ahead

• NBN has gigabit stories via FTTP/HFC/FTTN.

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Conclusion: NBN still moving forward

• FTTP, Fixed-Wireless & LTSS in progress

• NBN Co focusing on connecting end-users

• Now moving towards MTM model

• Preparations underway for FTTN + HFC

• Telstra & Optus negotiations continuing

• New acceleration technologies maturing well

• Aiming for 8 million happy homes and

delivering $4 billion in revenues by 2020.