Universal access to connectivity on the horizon
A national broadband network that has connected homes and businesses across the nation will soon be a reality.
As the digital landscape extends possibilities for all Australians, the valuable investment in the nbn™ broadband access network will underpin these opportunities.
Economics firm AlphaBeta conducted research, commissioned by NBN Co, to understand the economic and social impact of the project by comparing areas with and without access to the nbn™ access network.
The research estimated that during FY17, the nbn™ access network helped drive an additional $1.2 billion per annum in economic activity and is expected to increase to $10.4 billion annually by FY21.
In addition, the estimated business growth would facilitate an additional 31,000 new jobs across the country by the end of the rollout.
This considerable economic outcome affirms the importance of delivering the network as soon as possible.
By end of FY18, the build expanded to 7.0 million premises Ready to Connect (RTC) and activated 4.0 million homes and businesses. This included priority rural and regional areas classified as ‘underserved’, where 1.3 million premises are now able to use the nbn™ access network bringing them greater digital connectivity and as a result, flexibility in how they live and work.
The economists working on the AlphaBeta impact study forecast that because of the nbn™ rollout Australia will move into the top 10 OECD companies for internet equity which is a huge shift from being in the bottom 10 in 2012.
The deployment milestones were met while improving customer experience for those migrating or connected to the nbn™ access network.
Progress towards 2020
Over the past 12 months, the company made the decision to optimise the HFC network, introduce new wholesale pricing bundle discounts, expand the FTTC footprint, and make investments to upgrade capacity on the Fixed Wireless network.
These decisions are an outcome of our focus on the quality of the network, which has required us to make adjustments to our forecasts for the Corporate Plan 2019–2022.
At the end of FY19, we expect an additional 2.7 million premises declared Ready to Connect and an additional 1.9 million premises for the final year of construction to complete the build by 2020.
As a result of customer experience decisions as compared to last year’s Corporate Plan our RTC and activation profile has been rephrased. The deployment shift is a result of the HFC optimisation program, and the expansion of the FTTC footprint. As we forecast, 1.4 million premises in the network footprint to be connected by FTTC, which is the biggest deployment of the technology in the world.
The re-phasing has had an impact on activations, with our biggest activation year of two million homes and businesses planned for FY20.
With our track record demonstrating our ability to scale in partnership with Delivery Partners and retailers, we are confident planned targets will be met.
The HFC optimisation program and new wholesale pricing bundles will have an impact on short term revenue growth with revenue now expected to grow from $2.0 billion in FY18 to $3.9 billion by FY20. However, we still anticipate achieving revenue of $5.2 billion in FY21.
Continued revenue growth is expected with a lift in average revenue per user to $51 by FY22, supported by a take-up rate of 73-75 per cent, increased data consumption and greater penetration of business products.
We estimate peak funding to be $51 billion, which remains within the $47 to $51 billion peak funding range outlined in last year’s Corporate Plan.
The peak funding outcome is a result of our investment in customer experience including the HFC optimisation, wholesale pricing and an additional $800 million to improve capacity on our Fixed Wireless technology within the peak funding period.
By 2020, we forecast the build to be complete and eight million premises activated by the nbn™ access network.
As we edge closer to the completion of the rollout, we are preparing for new challenges and opportunities.
We’ll continue to drive revenue and ensure a modest return on the taxpayer investment. The company will continue to be open to the use of international developments in technology, such as DOCSIS 3.1 and G.fast, to maximise the potential of our network.
As Chief Executive, I am confident that my dedicated team will continue to demonstrate an ability to change, adapt and deliver. We will continue to strengthen our relationships with industry partners to ensure we deploy a network at speed and scale, and remain committed to working with RSPs to provide a positive customer experience.
At the end of the build, I am excited to see the ‘nbn-effect’ take hold as the economic and social impacts of the network are unlocked through universal access to connectivity.