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Australia’s National Broadband Network service activations expected to reach 4.4 million during FY18 from 2.4 million at end FY17

Image from 2018 nbn Corporate Plan (RFS- Ready for service)

Australia’s NBN Co Limited (nbn) released its 2018 Corporate Plan on August 31. According to the document, the National Broadband Network (NBN) rollout is on track to deliver fast broadband to all Australian homes and businesses, activating 8 million premises by its target of 2020.

nbn is an Australian government owned corporation, established in 2009 to design, build and operate Australia’s new high-speed, wholesale local access broadband network. Its objective is to bridge the digital divide and to ensure all Australians have access to fast broadband as soon as possible, at affordable prices, and at least cost.

national-broadband-plan-2

Image from 2018 nbn Corporate Plan (RSP- Retail Service Provider)

nbn has been structured as a wholesale-only, open-access broadband network. nbn provides services on equivalent terms to all Retail Service Providers (RSPs) to provision for end-user needs. nbn has a commitment to deliver access to peak wholesale download data rates of at least 25 megabits per second (Mbps) to all premises, and at least 50Mbps peak wholesale download data rates to 90 per cent of the fixed line network.

FY17 performance

At the end of FY17, more than 90 per cent of households and businesses are in design, construction or are already able to order a service over the nbn network. The rollout of the network has been concentrated where greater access to broadband is most needed – as at the end of FY17 66 per cent of the non-metro build is complete, compared to 33 per cent of the build in metro areas

nbn almost doubled the ready for service (RFS) footprint from 2.9 million to 5.7 million premises during FY17. In the same period, the number of premises connected to retail services over the nbn network more increased by 122 per cent to 2.4 million premises. Annual revenue moved up from $421 million to more than $1 billion, exceeding Corporate Plan 2017 targets by $101 million.

In November 2016, nbn announced that it will deploy Fibre-to-the-Curb (FTTC), a world-first technology that delivers fibre all the way to the telecom pit, or footpath, outside a home. The fibre then connects with a small distribution point unit (DPU) that uses the existing copper line to deliver access to fast broadband to the premises. FTTC delivers peak wholesale download speeds of up to 100Mbps, and has the potential to be upgraded when required to higher wholesale download speeds.

In October 2016, nbn launched its second dedicated satellite, Sky Muster, and on 28 February 2017 retired the Interim Satellite Service (ISS). In June 2017, nbn announced that it will double monthly maximum wholesale data limits and increase peak download plans by up to 50 per cent on the Sky Muster satellite service, effective October 2017.

Forecasts

nbn’s ready for service forecast for FY18 is around 8.7 million premises. nbn forecasts that 97 per cent of the footprint will be ready for service at the end of June 2019 compared to last year’s forecast of 96 per cent. nbn continues to forecast 8.1 million premises connected to services over the nbn network by the end of FY20 in line with the Corporate Plan 2017, with a forecast 8.6 million premises by the end of FY21.

nbn is increasingly seeing more end users sign up to nbn services in the first six months of the 18-month migration period, demonstrating high demand for access to services over the nbn network. This trend is expected to continue in FY18 with no change to the previous activations forecast of 4.4 million premises. This is consistent with the nbn forecast of 73–75 per cent take-up of premises covered by the nbn network.

nbn forecasts that its revenue will almost double in the coming financial year, from $1 billion in 2016-17 to $1.9 billion in 2017-18.

Network construction is at its peak currently, with more than 24,000 contractors and 6,700 direct nbn employees. There are around 2,500 Australian subcontracting businesses engaged either directly or indirectly to construct, operate and maintain the nbn network Australia-wide. Over 70 per cent of nbn’s procurement spend to date has been on local content – that is, Australian manufacturing, construction, installation and support activities. nbn will spend $6 billion during this financial year on procured goods and services, over 80 per cent locally.

The estimated peak funding remains unchanged at $49 billion, which includes a contingency of $2.3 billion for unforeseen risks with respect to both revenue and cost outcomes during the forecast period. 

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