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On 15/08/2010 10:25 PM, Grahame Lynch wrote:
<blockquote
cite="mid:AANLkTinachE_1EQ9myt0Ef6022XWB8QGaByDCJStK-m6@mail.gmail.com"
type="cite">
<div>Genuine question here</div>
<div> </div>
<div>If aggregation is such a possible and desirable outcome in the
NBN world why isn't it happening now with Band 3 exchanges? I accept
the economics of DSLAMs in band 3 are poor for individual access
seekers but presumably a wholesaler who aggregated demand could make a
case for Band 3 LSS deployments, especially given the complaints about
TW. To the best of my knowledge the last 4,500 of 5,000 ESAs remain
unsullied by competitive DSLAMs to this day....</div>
</blockquote>
A couple of excellent responses to this one - in summary it would
appear there aren't sufficient economies of scale even for an
aggregator to make a positive return, given the per-line prices.<br>
<br>
<blockquote
cite="mid:AANLkTinachE_1EQ9myt0Ef6022XWB8QGaByDCJStK-m6@mail.gmail.com"
type="cite">
<div> </div>
<div>Given the obvious opportunity for aggregation now and the
reluctance of anyone to bite the bull by the horns, what specific
drivers will encourage this to change when the implied "minimum bar" in
terms of "volume" transit and backhaul requirements in regional
Australia (ie higher speeds, higher quotas) actually increase
dramatically? (along with implied access cost - $25-30 NBN entry price
compared with $2.50 LSS price today).<br>
</div>
<div>I can't actually see where the incentive lies for a smaller
carrier to stay in the market or to specifically go to regional
Australia when they don't now....and I am aware of the new Nextgen
cable (is that the solution???)<br>
</div>
</blockquote>
<br>
Grahame - there may not be sufficient drivers in some areas. Even if
there are two competing backhaul carriers serving a given remote POI,
there is no guarantee that either of them will price their capacity low
enough for RSPs - or an aggregator - to make a positive return once
that backhaul component is added to the NBN port charge and other
charges. For some remote POIs, it is possible they'll build backhaul,
and no RSP will come. That said, there is a marketing advantage for an
RSP or an aggregator to claim 'complete national coverage' and service
that area anyway, make a loss, and cross-subsidise it with the margin
on other closer POIs with much higher volume and lower per-volume
costs. There is also an argument for something similar to the USO - a
subsidy for an RSP who steps up to serve such an area, to fill the gap
between a nominal 'reasonable' retail price and the higher actual cost
to serve them - or a subsidy direct to an end-user to help defray
having to pay a higher-than-mainstream retail price.<br>
<br>
P.<br>
<br>
<br>
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