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You may have heard that a few days before Christmas the Government released the NBN business case – formally known as the NBN Co Corporate Plan 2011-2013. There was a flurry of media coverage focusing on the financial stuff and the many uncertain assumptions the Plan depends on. But there were also some interesting new details beyond the expenditure and rates of return.

Picture of man holding coffee looking at laptopHere is a summary of key things to know from the Corporate Plan:

The roll-out timetable

The plan says the NBN will take nine and a half years to fully complete, an increase on the earlier forecast of eight years – and it makes some detailed forecasts for the next 3 years.

September 2011 will see the NBN ready to carry the first services via the regular providers – i.e. Telstra, Optus, iiNet, AAPT, Primus, Internode and the like.

By June 2013, NBN Co promises that around 1.7 million premises out of a total of 10.9 million will be covered. That means fibre-optic cable will go past 1.27 million premises; about 283,000 premises (mostly in rural areas) will be wireless-ready; and about 165,000 will be satellite-ready. But the estimated figure for premises with an active service over the NBN by June 2013 is much lower – just 570,000.

After 2013, NBN Co plans to accelerate the pace of the fibre roll-out, apparently reaching a peak rate of 5,900 premises being passed per day!

Fibre, wireless or satellite

NBN Co will not know exactly which premises will get wireless or satellite instead of fibre. This will not be known until field surveys have been conducted on a site by site basis during the roll-out.

Backup batteries

NBN Co will provide a one-off backup battery to people who sign up for a connection. This backup battery will power a regular phone which is plugged into the NBN box for up to 5 hours in the event of a power failure. The battery will have a life of around 3 years and it will be the responsibility of everyone to replace and maintain their own batteries. It is important to note that many people have cordless phones that already rely on the mains power. The NBN Co backup battery will not power phones of this kind that need their own power supply.

Speeds

NBN Co will have a basic entry-level service of 12 Megabits per second (Mbps) downstream and 1 Mbps upstream. For fibre areas, there are a further seven higher speed levels beginning at 25 Mbps down/5 Mbps up, rising to the highest level of 1000 Mbps down/400 Mbps up.

Price

NBN Co will charge service providers the same price regardless of whether the service is being delivered by fibre, wireless or satellite. Their estimate for how much consumers will pay is about $56 per month for the basic entry-level service, $65 for a medium speed service, and $81 for a high speed service. This forecast price would probably include both phone and internet services.

These figures, like almost all the figures in the Plan, are based on numerous assumptions and have been questioned by some industry experts who think prices for consumers will be higher.

Smooth transition

NBN Co says it is working a smooth, standardised transition process from the existing copper-based service to fibre. They want to minimise repeat visits to premises; ensure the installation teams are properly trained and monitored; and have efficient fault-resolution systems in place.

Stimulating new entrants

NBN Co says new retail service providers (RSPs) have a strong motivation to attract consumers to the NBN, and therefore NBN Co “will work to facilitate the emergence of new RSPs with innovative applications and services.”

NBN Co will also “support campaigns that promote the advantages of super-fast broadband and will work with RSPs to promote grassroots awareness of fibre and its benefits.”

Most people will go for cheap, not fast

The Plan admits that in the early years of the NBN, consumers will have few reasons to pay for the high speed offerings because there will be almost no applications available to consumers that actually require those high download speeds. Price will be the main factor driving consumer choice.

NBN Co expects that applications will be developed over time that take advantage of high speeds and that people will eventually see a reason to pay more. This is yet another of the hotly contested assumptions contained in the Plan.