Singapore’s NBN glitches could be a harbinger of trouble for Australia’s NBN

In Asia Pacific, only two countries are undertaking nationwide government-backed rollouts of an FTTH-based national broadband network (NBN): Singapore and Australia, markets that could scarcely be more different in terms of geographic size and suitability for ubiquitous FTTH-network deployment.

Since Singapore’s NBN deployment is in a far more advanced stage than the Australian version – which is being deployed by the National Broadband Network Company (NBN Co.) – the Singaporean rollout can offer some indication to NBN Co. of what can be expected on the long road ahead.

In Singapore’s case, the principal problem that OpenNet – the SingTel-led consortium that is responsible for building, managing and operating the Singaporean NBN – is experiencing is the difficulty of gaining access to multiple-dwelling units (MDUs) such as high-rise apartment buildings and other large housing complexes to install FTTH connections, a problem that will be familiar to many other FTTH-network operators in the region.

Although Singapore’s NBN has been connected to about three-quarters of the country’s buildings, as of end-June the network had just 40,200 subscriptions, well behind the government’s original expectations.

MDUs cause problems
The principal reason for the slow take-up has been the fact that many building owners have yet to give permission for OpenNet to install last-mile FTTH connections in their buildings, meaning that the country’s NBN retail-service providers are unable to offer services in many buildings.

According to data from the Infocomm Development Authority of Singapore, as of November 2010 about 90% of management/corporation-strata title (MCST) owners of MDUs contacted by OpenNet had rejected OpenNet’s offer to install FTTH connections in their buildings.
A renewed effort by OpenNet has improved the acceptance rate: As of end-August the firm had contacted 47% of the owners of the country’s MDUs, half of which have since completed their NBN installations. The rest have yet to give approval for installation.

OpenNet has yet to establish contact with the remaining 53% of MCST owners in the country, and it looks unlikely that they will be any more forthcoming than the initial batch contacted by OpenNet with regard to last-mile NBN installation, though OpenNet is working with the government to solve the problem of gaining access to MDUs.

Although OpenNet – in truly efficient Singaporean style – is likely to overcome its problems with accessing MDUs and finally deploy its last-mile FTTH connections, it will probably be a while before every household has access to the shiny new NBN.

The Hong Kong experience
Veteran FTTH-network operators in Hong Kong warn that gaining access to MDUs is by far the hardest part of deploying a FTTH network and say that in a significant number of cases it can prove impossible for an operator to gain access to a building to deploy infrastructure.

“Getting into the buildings from the street or up the buildings requires a number of factors, such as forming a working relationship with the building management or owners, and that’s just to get permission to enter the building in the first place,” a senior executive from Hong Kong incumbent operator PCCW told Informa Telecoms & Media.

“From there, you then have to deal with a lot of different factors, such as the amount of in-building decoration that has to be disturbed in order to deploy the in-building wiring. This is actually a really serious but often overlooked factor in deploying network infrastructure.”

In addition, the executive says that one a firm has gained permission to access a building, in-building deployment can often be delayed by unforeseen problems, such as blockages between the floor riser and the entry doors of each home in the building.

The executive says another common problem that the firm has encountered in its FTTH deployment is the need to reinstall ducting in many older buildings, usually because the existing ducting is in too poor a condition to support FTTH wiring, meaning that the firm must spend additional time and money to install new ducting in the entire building before installation can take place.

A senior executive from Hong Kong Broadband Network (HKBN) says it took the company “years to resolve this problem of getting in-building access,” though he adds that HKBN has largely overcome the barriers it faced in the earlier years of deploying its near-nationwide FTTH network.

Although PCCW and HKBN have both widely deployed FTTH networks in Hong Kong, not all firms in the country have been able to gain in-building access to deploy network infrastructure.
Most notably, leading terrestrial broadcaster Television Broadcasts (TVB) found its plans to deploy a nationwide digital SMATV network to carry its pay TV platform stymied by an inability to gain access to buildings to deploy a last-mile cable-transmission network to individual homes. The firm was ultimately forced to abandon the project.

The Australian NBN challenge
The issue of gaining in-building access to MDUs will be of crucial importance to NBN Co. in Australia, given the company’s estimation that about 37% of NBN connections will be installed in MDUs, equating to about 4.5 million of the 12.2 million FTTH premises on the network.

In an interview published Nov. 8, NBN Co.’s general manager of operational support systems, John King, told ZDNet that NBN Co. was trying to ease the deployment of the NBN in apartment buildings and townhouse complexes by working with body-corporate groups – the management arms of MDUs – to develop standard processes for NBN installation.

Under the current plan for connecting an MDU to the NBN, the company meets with individual body-corporate groups and formulates a design for installation in the building, which the group then needs to approve.

In the early phase of its network deployment, NBN Co. has been running into problems gaining access to MDUs, most notably in the early-rollout area of Brunswick in inner-city Melbourne, where only just over half of premises opted to have the NBN connected.

NBN Co. says it typically makes several attempts to gain consent from body-corporate groups to install the network in a building before declaring that access to the MDU in question is being officially “frustrated.”

Another problem experienced by NBN Co. has been the fact that many apartments inside MDUs are occupied by rental tenants, meaning that the firm has to get consent from both the renter and owner of the property before it can install a connection to the property – an extremely labor-intensive and time-consuming process.

The operator says the key to gaining in-building access to MDUs in the longer term will be in continuing to consult with body-corporate groups as closely as possible. The process is likely to be facilitated by the gradual switchoff of the existing Telstra copper network, which will persuade body corporate groups to grant NBN Co. access to buildings or face losing access to fixed-line telecommunications altogether.

Lessons learned the hard way
Amid the hype over FTTH deployments and talk about 1Gbps access speeds and the extraordinary applications that such bandwidth can bring, people often overlook the fact that some unfortunate individuals are out there doing the hard labor to make the technical revolution possible in the first place.

It’s not just a sweaty, boiler-suited technician running fiber-optic cable into an apartment building, either: It is also a small army of administration workers trying to track down elusive apartment owners to get permission to install FTTH in their rented properties or working out a network-installation plan with a confused body-corporate group.

Deploying an extensive fixed-broadband communications network is hard work and can take a long time, sometimes a lot longer than folks had planned for, even in a market such as Singapore, which appears to be one of the easiest places to deploy a nationwide FTTH network because of its small size and high population density.

Given that Australia’s NBN is over 10 times the size of its Singaporean counterpart, it is inevitable that NBN Co. in Australia will run into its fair share of deployment headaches in dealing with MDUs. We know that just from its early rollout experiences in Brunswick.

The real question is what the cost of these difficulties will be in both time and money. It is going to be extremely expensive and time-consuming if NBN Co. has to make multiple visits to a rollout site to connect MDUs in the area, a state of affairs that would put pressure on budgets and completion targets.

The situation is made even more complex by the turning off of the Telstra network: Although in many cases it should prompt body-corporate groups to pull their act together and have their MDUs connected to the NBN, it might cause some buildings to be cut off from fixed-line telecoms services altogether – a nasty prospect from a PR perspective.

Overall, Hong Kong’s experience suggests that NBN Co. in Australia will ultimately be able to gain access to most – but maybe not all – MDUs with recalcitrant owners to complete its network rollout, but doing so will require the patience of Job and might take a lot longer than anyone thought.

Comments
  • Peter Macaulay February 8, 2012 at 2:41 pm

    Only two countries doing NBN. Wow. You need to get out more. Australia is 4K installs with 12K homes past — and may well be re-defined with a new government.

    For success with NBN take a look at Malaysia with 29 million people. They are the largest regional NBN … 1.2 m homes past + 270K installs as of last week.

    Then take a look at the other (larger) projects in the region … Indonesia, Vietnam.

    /PETER MACAULAY

    • Avatar
      Tony Brown February 9, 2012 at 2:01 am

      Dear Peter,

      Thank you for you comments, I think we need some clarification here on what we at ITM mean by National Broadband Network.

      For us an NBN should have several defining characteristics….

      1] It should aim to achieve nationwide or close to nationwide coverage

      2] It should be owned/operated by an independent 3rd party operator – NOT an incumbent

      3] It should have open access for all RSP’s

      4] It should use NGN technology, usually FTTH/B but possible HFC-based too if it were Docsis 3.0 enabled.

      The only networks in the APAC region with networks that have these charateristics are Australia – where the network rollout is still in its infancy – and Singapore where they have nearly completed the FTTB part of the rollout.

      Telekom Malaysia’s High Speed Broadband (HSBB) network that you refer to has had a very rapid rollout but cannot be considered a true NBN for several reasons…

      1] It only covers 1.3 million premises – roughly 20% of total premises in Malaysia – and is concentrated in the Klang Valley region and in a couple of selected industrial zones, there are not confirmed plans to extend the HSBB to other areas at the moment.

      With only 20% coverage the HSBB can in no way be considered a truly “National” broadband network and in my numerous discussions with TM executives they have never referred to the HSBB as being an NBN style project.

      2] The Malaysian incumbent TM owns 70% of the HSBB project, with the government owning the rest, and TM therefore controls wholesale access to the network – something which runs against the spirit of a genuine open access NBN model.

      Your other examples of NBN models in Indonesia and Vietnam are also, I am afraid to say, somewhat wide of the mark.

      The announcement by Telkom Indonesia in November that it would be upgrading its fixed-broadband network was mistakenly reported in some publications as an NBN-style project when it really is nothing of the sort.

      The US$2.3 billion Telkom upgrade is being done solely by the operator with no governmental intervention – a point the Telkom CTO was very keen to clarify when I interviewed him in December – and they are really just upgrading their existing access network and deploying a mixture of FTTH/FTTN/ADSL.

      The upgraded network will be for Telkom’s use only and will not be opened to other operators, moreover even when the network is fully upgraded it will still only cover 13 million homes by 2015 (an ambitious target) which would give it nationwide coverage of only around 22% of total Indonesian households, which means it cannot be described as anything like a “National” broadband networks.

      As for Vietnam, I have just gotten back from Hong Kong where I met with their leading telco VNPT’s top officials, they are indeed conducting a major upgrade of their network to FTTH but it is absolutely not an NBN model either.

      The VNPT FTTH network is solely owned by the operator with no structured government role in its deployment and will be for the sole use of VNPT with other Vietnamese telcos such as Viettel and FPT continuing to deploy their own access networks.

      It looks highly unlikely that anyone else in the APAC region will deploy a genuine NBN model as has been deployed in Singapore and Australia although there are a couple of middle-east countries which are doing similar deployments.

      I hope this clears up any confusion that you may have been under.

  • Francis Young April 22, 2012 at 3:01 pm

    You also forgot South Korea, which completed its $46 billion government funded 100 Mbps FTTP rollout a few years back and is now seeding commercial upgrades to gigabit with further public billions. NBNCo has declared MDUs from the outset to be more difficult, and now has a multi-pronged approach to getting sign on including early discussions with landlords and property owners. It will reluctantly install basement switches and use existing copper if left no option, but the owners will regret this short sightedness within a few years and will pay a motza to upgrade.

    • Tony Brown April 22, 2012 at 10:51 pm

      Hi Francis,

      Thanks for your comments, much appreciated.

      Just a couple of points on your comments, the first being that the Korean FTTH networks have not been financed by the government but instead largely paid for by the three private telcos (KT, SK Broadband and LGU+), although the government has played a role in facilitating the rollout.

      In point of fact, the Korean government is pressuring the three telcos to upgrade their FTTH networks to 1Gbps (from 100Mbps) but the telcos are resisting this because they cannot see how they will get a ROI from this move.

      In terms of the MDU’s, you are correct that Australian MDU’s are typically smaller than the Singaporean examples but from talking to other APAC telcos conducting FTTH rollouts it is clear that MDU rollouts are rarely simple.

      The broad lesson with these FTTH rollouts really is to “expect the unexpected” and all manner of problems can spring up once technicians gain access to a building and start work.

  • Francis Young April 22, 2012 at 3:07 pm

    It is also worth noting that while MDUs in Singapore are mostly high rise, ours are predominantly much smaller, not only in numbers of units but also in numbers of floors. Running fibre up an outside wall to apartments of only two or three stories is no big deal if using the interior is frustrated.

  • Kenneth October 13, 2012 at 12:46 pm

    Another problem experienced by NBN Co. has been the fact that many apartments inside MDUs are occupied by rental tenants, meaning that the firm has to get consent from both the renter and owner of the property before it can install a connection to the property – an extremely labor-intensive and time-consuming process.

    Being a tenant of a commercial building in Singapore, I’ve attempted to subscribe to the new NBN service. Despite several pleas to the building management, the provider and I had encountered several resistances.

    Several reasons were raised by the building management, namely the need engage the inhouse contractors instead of the authorised contractors from the provider, with additional charges apply or the need to follow the cable routing plan from the building management that isn’t cost effective and yet, increase the difficulties for future troubleshooting (deeply concealed pipes or hacking floor tiles for underground conduit etc).

    Eventually, I decided not to proceed and retain with the subscription of traditional ADSL (copper) service.

    While the initiative for fibre rollout is highly encouraging, it is critical for a mandate to be issued for building managements to accept reasonable rollouts until tenants’ premises. This is a nationwide project. It should not be treated as a deterrence for building managements, or a new source to generate revenue.

    Cooperation from all organizations involved, is the key to success. After all, the benefits from this underlying infrastructure are enormous that would enhance info-communications services for significant business gains in future for all parties.

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