NBN purchases 15,000km of copper with 8 percent of new premises to have FttN

The company building out the Australian government's National Broadband Network (NBN) has revealed purchasing 15,051km of copper cabling to date for the purpose of building out fibre-to-the-node (FttN) connections to some newly built premises, also revealing that a portion of its hybrid fibre-coaxial (HFC) network will be new cabling laid by NBN.

In response to Senate Estimates Questions on Notice published this week, NBN has explained that it is connecting newly built premises with FttN rather than fibre to the premises (FttP) in some areas where the surrounding premises are served by FttN.

"If there are [a] couple of new homes that are being built in an existing FttN neighbourhood, copper will be run to those because it does not make economic sense to put fibre in for just a couple of homes on a block of land that has been remodelled," NBN CEO Bill Morrow had said during Senate Estimates.

"If it is in a bigger development, that is typically going to be served by fibre going up to those areas."

NBN has now revealed the figure for new premises being connected with FttN.

"Under current modelling, approximately 8 percent of new developments would be served by FttN technology by 2022. These will largely be in-fill developments in established FttN areas," the company said.

NBN's main copper supplier has been Prysmian, with the company purchasing copper from Australia, Brazil, and Turkey.

Shadow Communications Minister Michelle Rowland lambasted the federal government over the copper purchase, saying it was "enough to wrap around Australia", and far more than the 1,800km announced back in 2015.

"This copper splurge represents a growth rate of 736 percent from [Prime Minister Malcolm] Turnbull's 1,800km tally in October 2015," Rowland said.

"Malcolm Turnbull's use of taxpayer funds on last century's copper is yet another indictment of his failed second-rate NBN."

Also in response to Senate Estimates Questions on Notice, NBN said it will be in-filling almost 14 percent of the Telstra HFC network with newly laid cabling in order to fill gaps and degraded segments.

"The estimated percentages of new premises to be serviced within the HFC footprint is 13.9 percent," NBN said.

"The total purchase of copper will vary with final rollout technology mix, as each technology has unique characteristics that affect copper cable utilisation."

With NBN's 2016 Corporate Plan revealing a base case of 4 million premises receiving HFC, NBN provided a breakdown of this distribution: 3.5 million within the Telstra footprint, including in-fill; and 500,000 in the "not fit for purpose" Optus footprint.

Under the latest corporate plan, however, a base case of 2.8 million premises will be covered by HFC; 2 million by FttP; 6.1 million or 51 percent by FttN, fibre to the basement, or fibre to the distribution point; and 1 million or 8 percent by fixed-wireless or satellite.

NBN spends AU$8m on 'Gen NBN' marketing campaign

Also during Senate Estimates Questions on Notice, NBN further revealed its marketing and advertising spend over the past year.

The nationwide marketing campaign labelled "Gen NBN", kicked off in January, has cost NBN AU$7.8 million excluding GST so far, it said.

"We actually can see that there is a return on this. The brand image, the attractiveness, and of course the desire to take up the services sooner make the amount of spend -- and it is less than AU$10 million ... is well worth the investment," Morrow had previously told Senate Estimates.

NBN has now added that this spending was delivered within its budget, "which was allocated based on the optimal audience reach to drive activations on the NBN".

NBN has yet to finalise its future activity under the campaign, but it is slated to run until the end of FY17. The campaign's effectiveness will then be evaluated through a quantitative research study and a reach and frequency assessment, it said.

"Advertising is still essential to raising awareness of the need to migrate and successful advertising will motivate and inspire people to migrate early in the 18-month migration window, providing earlier revenue for NBN," the company argued.

"The Gen NBN campaign is one component of a multi-tiered communications strategy. It raised awareness and worked with other campaign elements such as the website, direct mail, and other marketing to step people through the migration process, starting with a 'check your address' link."

During January 1, 2016, to February 28, 2017, NBN spent a total of AU$34.5 million excluding GST on "advertising and information campaigns": AU$22.6 million on paid media advertising and production; AU$7.9 million on physical and electronic "mail awareness and education"; and just under AU$4 million on in-person demonstration, education, and information provision.

NBN has been ramping up its advertising campaign; AU$22.99 million of this AU$34.5 million was spent during the 2016-17 financial year up until February 28, 2017.

During 2015-16, NBN also spent AU$41.8 million on "activation, communication, and public education campaigns" and AU$9.5 million on corporate affairs, market research, and the supporting operational systems for this.

This total AU$51 million was broken down into AU$21.8 million on advertising and media to residential and business end users; AU$12 million on direct communication campaigns; AU$5.4 million on customer cooperative marketing campaigns; AU$5.1 million on website, marketing systems, and marketing research; AU$3.9 million on corporate communications; and AU$1.6 million on branding and partnerships.

NBN also spent AU$10.9 million on 91 forced redundancies during calendar 2016.