Consumers to benefit from alternative FTTN network

A consortium of telecommunication carriers led by Optus, has unveiled plans for an alternative national FTTN network that could double consumer benefits. But there's a catch, they still need Telstra.

The details were outlined in a report conducted by Allen Consulting Group and dandolo partners titled A Competitive Model for National Broadband Upgrade.

The group of nine carriers, comprising Optus, AAPT, Internode, iiNet, Primus, Macquarie Telecom, Powertel, Soul and TransACT would form an independent umbrella company named SpeedReach to build and run the network.

The consortium estimated the total cost of the rollout at $4.1 billion, one billion more than Telstra's proposed cost for its high-speed network. The added costs would allow the network to reach five million homes and businesses if jointly constructed with Telstra.

However, the report noted that without Telstra's participation, those numbers would dwindle significantly.

"It would be much better for everyone if Telstra supported the plans, but it is still doable without their support," said Allen Consulting Group director, Gerome Fahrer.

Fahrer said with Telstra's support, the proposed network would be able to provide high speed internet access for reasonable pricing, once approved by the Australian Competition and Consumer Commission (ACCC), but added that specifics were still a long way off.

The availability of high speed internet would provide consumers with the ability to access IPTV, Video-on-demand, interactive messaging and other high bandwidth applications, he said.

The report estimated that a competitive high speed broadband network could double consumer benefits to between $17 billion and $23 billion.

"In terms of demand for the services this network could open up, it's a bit of a chicken and egg problem because prices are high and the technology is not there at the moment," Fahrer said. "But a competitive model would provide plenty of demand as long as the service quality is high enough and it's priced appropriately."

Fahrer declined to comment on a due date for the projected network, but added that plans would go ahead with or without Telstra.

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