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This report reviews a range of statistics and trends in the Australian fixed broadband market, including market share for major fixed broadband providers, market share by major broadband category (DSL, Cable, Fibre, Satellite and Fixed wireless) and market forecasts to 2021. The report examines how there is a shift towards FTTH, FTTN and FTTP networks as Australia’s nbn is progressively rolled out and how the market will move away from DSL. It will show how HFC infrastructure will continue to be provided within the nbn’s multi-technology mix.
The report also incorporates data from government departments including the Australian Bureau of Statistics and the ACMA as well as key statistics for the rollout of Australia’s NBN.
The report also analyses the drivers behind broadband adoption within the Australian residential and business sectors, and notes the shift to a market more dominated by mobile devices.
In addition, the report analyses the situation with respect to greenfield fibre deployments. It provides an overview of fibre operators, as well as statistics on the FTTP market and a review of developments related to DSL and HFC infrastructure as well as satellite broadband.
Australian National Broadband Network rollout finally gains momentum
Within the market there is a dynamic shift among customers to fibre networks, as this infrastructure is being built out by nbn (NBN Co), the company responsible for the national broadband deployment. Australia’s broadband sector is making improved progress in its migration to a multi-technology the NBN.
Growth in the overall number of broadband subscribers is expected to continue to slow further into 2018, with most growth coming from the mobile wireless and fibre broadband markets, due to increased uptake by the NBN in these two segments.
The DSL sector is expected to shrink as customers are migrated to the NBN in areas where services become available, while subscribers on HFC infrastructure will continue to be provided by existing cable within the NBN’s multi-technology mix.
Internationally, the adoption of broadband ranks Australia below many other developed countries, however it has seen a moderate increase over the past two years due to the continued rollout of the NBN.
Consolidation within the broadband market, with some key acquisitions having taken place among fixed broadband service providers, will provide greater reach and scale for operators in coming years.
By 2016 FTTH still dominated the NBN statistics with 75% of all NBN subscribers using this technology. However, this will change rapidly over coming years as the FTTH roll out comes to an end (with the exception of greenfield connections). The nbn announced in December 2016 it was ready to deploy its “multi-technology mix” (MTM), offering a mix of FTTH, FTTB and FTTN in new housing estates. By 2017 FTTN and HFC began to dominate the NBN scene and by 2017 it was closer to 50% of all activated services that were FTTH / FTTN.
The nbn revealed plans to begin deploying “skinny fibre” (thinner fibre cables) in new housing estates from 2017/2018.
The deployment of FTTH in greenfield estates is a fast-growing industry, supported by an updated regulatory regime and pricing models. Recent legislation provides the framework for all new major housing sites to be supplied with FTTH infrastructure, or to be made ready (pit and pipe) for such deployment. The nbn has in place measures aimed at improving competition, minimising costs, and providing a level playing field for participants in this sector. Controversially, developers and home owners will be charged for the infrastructure costs in new housing developments.
The current NBN plan provides a multi-technology mix rather than be predominantly FTTH. Under the new scheme, FTTH will connect 20% of premises by 2020, while a further 38% will be served by FTTN - using the VDSL technology - and another 34% of will receive services via existing HFC networks. Using this approach, the government anticipated that 91% of premises connected to fixed-line infrastructure would receive 50Mb/s by 2020. The capital cost was put at $29.5 billion (US$27.4 billion).
The roll out of FTTN didn’t start until late 2015 and by April 2017 the service has 676,000 subscribers. However, this number is set to increase rapidly over coming years.
In 2016 nbn announced it would entirely abandon its plan to use the Optus Hybrid Fibre Coaxial (HFC) network to deliver high-speed broadband. It is now confident it can deploy the Fibre-to-the-curb (FTTC), technology in areas where it makes better sense from a customer experience, deployment efficiency and cost perspective, rather than upgrading the old network. The nbn will however still be using Telstra’s more extensive HFC network as planned and is still aiming for an HFC footprint of between 2.5 and 3.2 million premises by 2020.
The HFC networks of Telstra and Optus’s are being deployed as part of the NBN, so reducing the overall cost of the project’s rollout. However, the nbn’s Corporate Plan for 2017 envisages greater use of FTTC in HFC areas, given the mounting cost of connecting premises with HFC.
In international terms, the capabilities of HFC in Australia remain comparatively low, and there is considerable scope for improvement. In Europe, HFC networks commonly deliver data at up to 360MB/s, while some networks (such as Vodafone’s in Germany) deliver data at 400Mb/s.
The nbn is expected to operate services based on the DOCSIS3.1 during 2018, capable of delivering data at 1Gb/s. It is also actively looking at other cable networking advances such as full-duplex DOCSIS technology, which is capable of 10Gbps symmetrical speeds.
The nbn has confirmed FTTC, would be deployed to a potential footprint of up to 700,000 premises across the country. The expanded FTTC footprint fills the void left by the nbn’s decision not to use the Optus HFC cable assets, although it will still be using Telstra’s more extensive HFC network as planned. The nbn is however still aiming for an HFC footprint of between 2.5 and 3.2 million premises by 2020, using the Telstra assets.
- Growth will come from the mobile wireless and fibre broadband markets.
- DSL sector is expected to shrink.
- HFC infrastructure will continue to be provided within the nbn’s multi-technology mix.
- Consolidation within the broadband market will provide greater reach and scale.
- nbn will begin deploying “skinny fibre” in new housing estates from 2017/2018.
- The deployment of Fibre-to-the-Premises in greenfield estates is a fast-growing industry.
- nbn will operate services based on the DOCSIS3.1 during 2018, capable of 1Gb/s.
- Fibre-to-the-curb (FTTC) will deployed to a potential footprint of up to 700,000 premises.
Key companies mentioned in this report:
Optus, Telstra, nbn (NBN Co), iiNet, TPG, TransACT, M2, iiNet, Optus, Primus, LBNCo, OPENetworks, OptiComm, RedTrain, Pivit, Foxtel.