Commpete backs AUD $3bn fibre upgrade, urges caution

Commpete, an organisation advocating for telecommunications advancement, has expressed both support and caution regarding the Australian Government's recent decision to invest AUD $3 billion into upgrading fibre connections.

The company commended the government's decision, acknowledging the importance of enhancing telecommunications infrastructure in the face of increasing digital demands. The government plans to upgrade fibre-to-the-node (FTTN) connections to fibre-to-the-premise (FTTP), which Commpete believes is currently the best available solution to ensure Australia remains competitive with globally recognised digital connectivity.

"Commpete supports the Federal Government's announcement on January 13 of an additional $3 billion to upgrade fibre-to-the-node (FTTN) connections to fibre-to-the-premise (FTTP). Commpete has long advocated greater investment into upgrading Australia's telecommunications infrastructure in line with the increasing demands of digital transformation, and to ensure Australia remains globally competitive supported by globally recognised digital connectivity."

"Commpete believes FTTP is the best available solution at this time and the decision by the Federal Government to double down on existing investments in this connectivity, seeking best possible equal access and quality, is to be applauded," stated Commpete in an official statement.

The organisation also welcomes the projected timeline of five years for the completion of these upgrades but highlighted the importance of adherence to this schedule. Commpete stressed the significance of the government and NBN working closely to maintain this timeline, given the ambitious nature of the project and the planned budget.

"We welcome the projected timeline of five years to deliver the upgrades announced yesterday and we urge the NBN to work closely with government to ensure the program keeps to that timeline. We also note the budget of $3 billion announced, mindful of the importance of delivering value to Australian taxpayers. Commpete believes this timeline and budget is ambitious given the challenges of delivering large-scale infrastructure in regional areas, notwithstanding increases to material and labour costs during the program," the company remarked.

With a forecasted cost of AUD $6,100 per premise, Commpete raised concerns over the return on investment timeline. They pointed out that it will take over a decade for the government to recoup the costs of investment per premise, based on average monthly access fees.

"In this respect it is important to call out that, at the forecasted $6,100 per premise, it will take over a decade for this investment to be returned on a per-premise basis based on an average $50 per month for NBN access. This puts the cost and time schedules on a very thin line to ensure the benefits of all-important NBN access are fully realised," Commpete noted.

Furthermore, Commpete questioned the government's consideration of other emerging technologies that might rival the NBN.

They highlighted the advancements in fixed wireless access (FWA) and satellite technologies, which are speculated to become more viable alternatives within the next five to ten years.

"Commpete is interested to understand the Federal Government's position on future technologies which are expected to compete directly with NBN. For instance, what consideration has been given to fixed wireless access (FWA) and satellite and the impact these technologies may have on NBN uptake? These technologies are advancing rapidly and are already winning business away from NBN."

"In 5-10 years, these alternatives will have accelerated and advanced considerably, potentially becoming more attractive alternatives to NBN," the statement said.

Commpete believes competition among technology providers delivers better outcomes and is concerned the government's investment focus on NBN could overshadow the potential benefits of diversifying into alternative technologies, which could ultimately affect digital transformation solutions in Australia.

"Competition in the delivery of services including across technologies will always deliver a better outcome. Commpete is concerned yesterday's announcement of further investment in NBN may mean alternative investments in alternative technologies are not pursued, potentially at the detriment to competition and ultimately digital transformation solutions for Australian people and organisations," the company concluded.