NBN takes a hit as HFC network roll-out is delayed

Ahh, you’ve gotta love the optimism of the NBN – their announcement today that “NBN Co takes customer experience improvement program to new levels” sounded great, until you realised it was a very round-about way of sugar coating bad news for a couple of million households.

As you might know, under the current NBN plan, a mixture of technologies is being employed to deliver the NBN to Australian homes. Fibre to the Premises (FTTP), Fibre to the Node (FTTN), Fibre to the Curb (FTTC), Fibre to the Basement (FTTB), Satellite, Fixed Wireless and also HFC (Hybrid Fibre Coaxial).

The HFC network is a cable network that runs past some 3 million Aussie homes and was installed to deliver Pay TV (Foxtel) and for some time has been used for both Pay TV and “Cable Broadband” with Telstra offering Bigpond Cable connections.

Optus too had a HFC network and originally under the new “MTM” NBN the plan was use both Telstra and Optus Pay TV cables for NBN connections. Turns out Optus configured their network quite differently to Telstra, putting some 1,500 homes on each Node on the HFC network, while Telstra operated at around 800. That congestion didn’t suit the NBN and would have required much more work, so it’s just the Telstra Cable that’s being used for NBN.

Today, CEO of the NBN Bill Morrow announced that all HFC activations would halt while the company got their ducks in a row; “So we can provide a better experience to our customers and their end users, NBN Co will immediately implement new initiatives designed to improve the quality of service for end users on our HFC network.

“In order to deliver an improved experience on HFC, NBN Co will be performing additional work ahead of end users being able to connect to nbn™ services on the HFC network.

“With the incremental work now required before a home is declared ready to connect, we are focused on providing a better service to our customers (the internet service providers) and thereby improving the experience for the end user.

“While the good news is that we are working on a better experience for the internet providers and end users, the improvement efforts will take additional time and therefore a delay of schedule will occur for most of the remaining HFC premises that have yet to switch to services on the nbn™ access network.

“We remain confident of reaching our goal of completing the build and connecting eight million Australian premises by 2020”

So what’s it all mean? Firstly, anyone who had checked the NBN website and found they were getting NBN via HFC some time in 2018 might find that date stretching out when the site is updated in the coming weeks. Delays could be up to 9 months from what you had expected.

The reason is, around 1.5% of customers on the NBN via HFC have reported issues with their services, which NBN has discovered relates to “noise” on the line.

CEO Bill Morrow told me two months ago that the HFC network was an area of concern for them and that he hoped to have a solution within months.

His solution is today’s announcement. Stop all new roll-out, and fix the problems Identified.

This fix involves technicians “tightening” the network. Where “taps” (points on the HFC line where a home can be connected to) exist on the network that have no home connection, there is potential for leakage and electrical interference. NBN has discovered that by tightening down the network (literally nuts and bolts to close down any “leakage”) the network performance can improve dramatically.

Thus, they are going to remediate the connections in existing areas, and ensure that as the new roll-out timetable is developed it includes this type of work in all areas.

NBN’s use of the HFC network uses a different (lower) frequency to the Telstra Bigpond customers (who remain on the network) and Foxtel’s transmission – this lower frequency is more open to the noise and interference, and as such the problem has not existed for Telstra Bigpond customers.

There’s no sign that this will delay the completion of the NBN roll-out, there are almost 1 million homes ready for service on the NBN HFC network with 370,000 already connected. The remaining 2 million will have to wait a little bit longer than before. No real cause for complaint though, as they all have access to 100mbps speeds from Telstra already.

Importantly, there is no correlation between the capacity issues of the Optus Network that cause the NBN to walk away from plans to use it, and the issues being rectified on the NBN’s use of the Telstra HFC network.

And then there’s the cost – use of the HFC network is some of the best use of funds within the entire project.

Digging Fibre to every single home was costing $4,400 on average per household, Digging Fibre to the Node and using existing copper is the cheapest way – averaging out at $2,200 per household, while the HFC network costs on average $2,300 per household – with a large part ($1000+) of that going to Telstra as part of their settlement and agreement to sell their infrastructure network to the NBN.

It’s a bad day for those who were hoping to get the NBN via HFC in the coming months, but in the long run, the service will be more reliable.