[AusNOG] FTTH - Dreaming?

Fri Aug 29 09:46:23 EST 2008

Hi All,

Pardon me for weighing in a bit late here, but there's 2 things I've 
just got to say.

1. Curtis, congratulations on having the balls to stand up and say 
something (at least somewhat) positive about Telstra.

2. I love how everyone is so happy to go on about Telstra's massive 
profits and government subsidies but conveniently ignores how much they 
give back (even if it's not by choice)

Scott so kindly pointed out the link to the financial results, here's 
what I found with a quick scan thru.

Telstra has payed out a 14c dividend for the last 2 years, IIRC the gov. 
still owns just under 50% or thereabouts, making a dividend of around 
$3B, add to that the $1.4B or so they payed in taxes last year and we're 
looking at nearly 4.5 Billy per year over the last 2 years.*

Anyone wanna run the numbers on how much the gov. made while Telstra was 
still a government dept. with a proper monopoly? I'm willing to wager 
that it would dwarf the figures above (taking into account inflation and 
the like)

All that and we want to sit here and complain about a measley $800 mill 
over several years, c'mon guys, lets get real.

Anywho, that's just my 2.5c, take of it what you will (for the record, I 
don't love Telstra, I just don't feel that they are entirely evil).

* Please don't pick at my maths, I'm coming off the back of a long night 
of dealing with a big Optus outage and should be in bed, not reading 
AusNOG posts.

Cheers,
Damo!

!
Duct tape is kinda of like the Jedi Force,
It has a dark side, and a light side, and
it holds the world together
!

lists wrote:
> Hi All
> 
> ----- Original Message ----- 
> From: "Curtis Bayne" <curtis at bayne.com.au>
> To: <ausnog at ausnog.net>
> Sent: Saturday, August 16, 2008 3:18 PM
> Subject: Re: [AusNOG] FTTH - Dreaming?
> 
> 
>> Yup, just as I expected. First paragraph and they're bashing Telstra 
>> already.
> 
> The first paragraph was not Telstra bashing.  It was a well thought out way 
> of trying to address the issues that faced Optus in the 90's when thye 
> decided to roll out a pay tv network.  To set the record straight.  Telstra 
> had no interest in rolling out Pay TV or dial up internet as it did with 
> dragging its heals on ADSL etc.  It however did take the view that it needed 
> to match Optus in a market protection strategy.  There were and are a number 
> of other things it did at the time to prevent Optus from gaining market 
> share and return oin capital.  The first paragraph is therefore explained 
> the way it is,  so that the larger well balance sheet resourced incumbents 
> who ever they may be cannot misuse their market dominance to essentially 
> undertake market protection strategies designed to discourage competition.
> 
> How would everyone feel if what happened to Optus happened to commercial 
> deployments they undertook and Telstra decided to spend millions or hundreds 
> of millions to see the competition disappear.  Lets take another 
> hyperthetical example.   Lets say a smaller less balance sheet enabled 
> carrier decided to deploy an international cable to reduce transit costs. 
> Then lets say Telstra decided to let them build it nearly,  then telstra 
> decided to drop the price of data to levels that make it difficult for that 
> network to be payed for  or lets say that Telstra says to the market you can 
> sell ADSL 2 if you buy your backhaul from us.   Is that fair competition.? 
> Is that misuse of market power?  Of course not because it is allowing 
> consumers choice, or at least that has been the way the ACCC has been 
> approaching it..   Then the poor little carrier runs into financial trouble 
> and Telstra offers to bail them out.  Then what happens to the price?  I 
> think everyone should get the jist of this, which brings me back to my 
> comments in the first paragraph.
> 
>> Dear reporters: Telstra is here, they're the reason a number of rural 
>> Australians have access to DSL/ISDN where it would never have been 
>> profitable to do so.
> 
> That 2 is not necessarily correct in so far as it was government policy ie 
> megapop that stopped a lot of the rural deployments by other lower cost 
> providers.  Many of the rural ISP's ran for cover after having the 
> government subsidise telstra to roll out megapop which had major cost 
> advantages to Telstra and put those with rural based networks at a 
> disadvantage.  This subsidisation of telstra amounted to $800Million ish 
> upto 2004
> 
> 
>>  I'm not saying that the sun shines from their behind, but it frustrates 
>> me deeply when nobody gives credit where credit is due.
> 
> If you want to give credit fine.  But if you want to rebut what was 
> essentially a few thoughts on how FTTH may get deployed then reference the 
> massive amounts of subsidies Telstra has received in the form of government 
> grants and USO payments.  Please don't take that the wrong way.  I am just 
> saying there needs to be some balance and everything needs to be put on the 
> table. Perhaps there is a better way perhaps not
> 
> 
>> In my personal experience, Telstra have a fantastic network
> 
> Yes they do.
> 
>> - you get what you pay for.
> 
> Yes that is true.  If you are a residential customer you can get an ADSL 2 
> tail with 20 MB / 1 MB data transfer capability, but if you are a business 
> customer a 10 MB DSL tail will set you back $9000 - 10000 per month.  Just 
> goes to show how you can get what you pay for.   But that is not the object 
> of the discussion
> 
>> I am probably lying. Your mileage my vary. Please don't flame me.
> 
> No flame intended.   Just a clarification on the original article and some 
> additional comments
> 
> I have spent a lot of time looking at these and other senarios in order to 
> find strategies to address the associated issues.  I recon you could nearly 
> write a book on this stuff, but who would want to read such a depressing 
> piece of writing.   My conclusion is that unless the government through its 
> industry regulation prevents incumbents from undertaking market protection 
> strategies then there is so much risk involved that very little will happen 
> and a technology that offers so much is unlikely to get deployed.  On the 
> other hand if they did provide some say 5 year protection then we may well 
> see a much different result.  It may either have the effect of making the 
> incumbents deploy themselves before others saw a market niche or it may 
> provide the certainty to allow so niche market type deployments that may be 
> the catalyst for larger deployments.  That was the basis of the original 
> comments
> 
> Regards
> 
> Tim
> 
>> Regards,
>> Curtis
> 
> 
> 
> 
> 
>> Managing Director
>> SONET Telecomunications
>> ________________________________________
>> From: ausnog-bounces at lists.ausnog.net [ausnog-bounces at lists.ausnog.net] On 
>> Behalf Of Bevan Slattery [Bevan.Slattery at staff.pipenetworks.com]
>> Sent: Saturday, 16 August 2008 8:06 AM
>> To: bruce at tubes.net.au; ausnog at ausnog.net
>> Subject: Re: [AusNOG] FTTH - Dreaming?
>>
>> Gold!
>>
>> ----- Original Message -----
>> From: ausnog-bounces at lists.ausnog.net <ausnog-bounces at lists.ausnog.net>
>> To: ausnog at ausnog.net <ausnog at ausnog.net>
>> Sent: Sat Aug 16 07:31:00 2008
>> Subject: [AusNOG]  FTTH - Dreaming?
>>
>>
>> We need a 4 point plan to ensure success with this idea, i have done a
>> rough plan up... feel free to correct me if im wrong.
>>
>>
>> 1, Build FTTH Network
>> 2, Free Internets
>> 3, ???
>> 4, 600 billion profit.
>>
>>
>> Regards,
>>
>> Bruce
>>
>> On Sat, 16 Aug 2008, McDonald Richards wrote:
>>
>>> AusNOGers,
>>>
>>>
>>>
>>> While working on the early hours of a Saturday morning as I know so many 
>>> of
>>> us do I stumbled across this gem of an article. I'd love to know who
>>> actually edits and fact checks this junk before they publish it online.
>>>
>>>
>>>
>>> http://business.theage.com.au/business/fibre-to-the-home-a-musthave-only-gov
>>> ernment-can-provide-20080814-3vr0.html
>>>
>>>
>>>
>>> Some of the quotes are absolute gold.
>>>
>>>
>>>
>>> "The Federal Government should build and control a FTTH network capable 
>>> of
>>> speeds of at least 100 megabits a second. This would require a capital
>>> expenditure of about $15-20 billion but this cost is easily justified."
>>>
>>>
>>>
>>> "The Government should maximise public use of a FTTH network by charging 
>>> a
>>> modest annual administration fee of $50-100 but nothing for actual use. 
>>> This
>>> would cover the network's administrative and minimal running costs.
>>> (Maintaining our copper network reportedly costs a lot more - about $600
>>> million a year.)"
>>>
>>>
>>>
>>> "A FTTH network would give Australians free national phone calls and fast
>>> access to the internet. And its applications would have obvious social 
>>> and
>>> commercial benefits."
>>>
>>>
>>>
>>> In fact I think I had a good chuckle at almost every paragraph. Don't 
>>> even
>>> get me started on the technical points! With the cost analysis of 98% 
>>> FTTN
>>> coverage done by Pipe coming it at ~16 billion I'd love to know how the
>>> author of this article believes an FTTH network can be built by the
>>> government for "about 15-20 billion". They didn't even reference the 
>>> total
>>> population coverage and there's only a 5 billion dollar window in that
>>> highly scientific cost estimate - which is more than Labor plan to
>>> contribute in total to FTTN!
>>>
>>>
>>>
>>> I hope you all enjoy it as much as I did.
>>>
>>>
>>>
>>> Macca
>>>
>>>
>>>
>>>
>>>
>>>
>>>
>>>
>>>
>>>
>>>
>>>
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