[... continued]
To construct the network’s fiber web, engineers opted to use passive optical network (PON) technology, a standard approach for FTTP networks. In NBN Co’s PON system, a single fiber would ferry data from a central office to a small curbside cabinet, where a beam splitter would divide the signal, guiding the light through up to 32 branching fibers, each leading to a separate premises. Unlike active optical networks, which electronically switch data at the cabinet in order to route it to its final destination, PON systems broadcast to all premises on a splitter. They rely on electronic switches at each customer’s terminal to weed out the neighbors’ traffic and encrypt the data to prevent eavesdropping. PON systems also tend to be cheaper, use less power, and are easier to maintain than active ones because they don’t require engineers to install and tend to switching equipment in outdoor cabinets.
When construction began on the NBN in 2010, the fastest equipment available for transmitting data on a PON network relied on an industry standard known as gigabit PON, or GPON, which can send 2.4 gigabits per second to each splitter. This overall capacity would be divided among all of the premises on a splitter. However, if several customers in a neighborhood opted for fast services, NBN Co would simply install more splitters at the cabinet—a quick, 20-minute job. This way, NBN Co could guarantee that every fiber-connected Australian who wanted the maximum 1 Gb/s rate could get it.
Inevitably, though, some people would fall outside this fiber footprint. About 7 percent of Australians live in rural communities or remote outposts where wired broadband access is technically or economically unviable. NBN Co would connect about half this population via fixed wireless towers equipped with standard 4G LTE technologies capable of delivering download speeds up to 25 Mb/s and upload speeds up to 5 Mb/s to each customer. The other half would be served by two new high-bandwidth geostationary satellites due to launch in 2015, which would provide similar data rates.
But no matter the type of access technology—fiber, wireless, or satellite—NBN Co would still charge commercial providers the same wholesale rates to use its pipes, ensuring equal and fair prices to all consumers regardless of location.
Many politicians and industry executives praised the NBN plan. Alan Noble, Google Australia’s head of engineering, called it “the greatest enabler of innovation.” Others said it was “a critical part in the evolution of the Internet” and “too good an opportunity to miss.” Nevertheless, the plan was controversial from the outset. Members of the conservative Coalition, concerned about rising costs and construction delays, have described the NBN as a “dangerous delusion,” a “white elephant on a massive scale,” and a “shockingly misconceived, wasteful exercise in public policy.”
Some of the early criticisms, particularly from media commentators, stemmed from technical misunderstandings. Opponents of the FTTP approach, for instance, often reasoned that the popularity of mobile gadgets is causing wireless technologies to advance so rapidly that they will eventually offer greater speeds than fiber, making the NBN obsolete.
The fallacy of this assumption is immediately apparent to anybody with a basic knowledge of wireless networks. Such connections will always be limited by the bandwidth capacity of a cellular base station, which must be shared among all its users. Even if one station could use all available radio spectrum to serve one customer, the bandwidth of frequencies that can be passed through an optical fiber would still be some 20 000 times as great.
What’s more, mobile systems may not be able to sustain their awesome growth without an extensive fiber network. Already, operators are deploying
miniature base stations known as small cells in homes, businesses, and busy urban centers, to help expand capacity and bring services to places where traditional towers may not reach, such as indoors. The glut of data flowing through these cells will need to be hauled to and from an operator’s core network—a job that suits fiber very well.
Other critics of the Labor Party’s plan worried that giving NBN Co sole ownership of Australia’s physical network would stifle infrastructure competition, keeping prices high for consumers and slowing the adoption of new network technologies. This argument might be persuasive in more densely populated countries such as the United States, where high consumer demand usually ensures vigorous competition based largely on technology. Indeed, in the United States, Verizon began offering its FiOS FTTP service in 2005, and plans are now available to more than 18 million homes, 5 million of which have subscriptions, the company says.
But in Australia, providers have already demonstrated that a free market hasn’t produced good access options for most consumers. In the 1990s, for instance, Telstra and its competitor Optus strung separate hybrid fiber-coaxial lines, a faster service than DSL, to the same 2 million premises in some populous suburbs of Sydney and Melbourne. Meanwhile, millions more premises missed out on the upgrade.
[continued ...]