The facts about NBN and how it affects business

With the NBN now rolling out to different parts of the country there seems to be more confusion than ever before on how the NBN will effect business. Some of this confusion has surfaced due to the different rollout plans for domestic and business and some from misinformation being circulated by dubious business attempting to panic business customers into immediate action.

Here are the facts:

  • The NBN is a Federal Government initiative which aims to provide Australians with access to high speed broadband. The project is expected to be completed in roughly 2021.

Under the initiative, fibre to the premises will be rolled out, on a region-by-region basis, to 93% of Australia’s premises, while the remaining 7% will be served by either fixed wireless or satellite technologies.

  • NBN Co is responsible for the process of connecting fibre services to the NBN
  • Copper services will be phased out and eventually disconnected where NBN has been connected.
  • Residential grade products must be migrated to the NBN within 18mths of NBN being made available.
  • Business grade copper products are not currently scheduled for disconnection but when this scheduling begins, they will get 36mths to migrate to NBN.
  • Copper services will no longer be available for purchase where NBN is now available.
  • Telstra’s Migration Plan provides wholesalers with control over the timing of the migration of their end users’ services to the NBN.
  • Copper customers will be able to lodge orders to cancel services at any time before the required disconnection date.
What are your business options when NBN arrives?
  1. Keep your current phone system (if its VOIP capable) and add a NBN VOIP gateway.
  2. Upgrade to a VOIP phone system
  3. Move to a hosted solution
  4. If you have an existing ISDN/VOIP service, relax, there is no current need to do anything
Introduction of Traffic Classes

A key capability of the NBN is the introduction of four traffic classes to improve quality of service for RSPs targeted retail offerings. What this means is traffic for telephone calls, IPTV, gaming or business applications, including health and education, may be allocated to the appropriate traffic class, given priority and managed across the network to ensure there is a satisfactory customer experience.

The four traffic classes are described by NBN Co in the Ethernet bitstream fact sheet:

Traffic Class 1 (TC-1). Our highest priority traffic class. It is delivered as a committed information rate (CIR) with defined latency, jitter and loss characteristics. It is suitable for applications that require highly deterministic traffic parameters such as voice.

Traffic Class 2 (TC-2). A traffic class that provides support for latency sensitive, interactive applications such as video conferencing, converged business collaboration, IPTV or gaming. It is delivered as a committed information rate (CIR) with defined latency, jitter and loss characteristics.

Traffic Class 3 (TC-3). A traffic class designed to give priority to transactional data such as business applications running on a WAN. It is delivered as a committed information rate (CIR) with defined latency, jitter and loss characteristics.

Traffic Class 4 (TC-4). Our ‘best efforts” traffic class is designed for browser based applications such as the internet and web browsing. It is delivered in a range of peak speeds (PIR) that are asymmetrical.


NBN Co’s FTTB Ethernet bitstream service will support traffic class management, however, there are several important limitations identified in Section 6 of the FTTB product technical specification.

The first limitation is that only TC-1, TC-2 and TC-4 are available for FTTB at this time. What this means is that potential high value business applications are not being supported and this limits what RSPs can offer and restricts the possibility of new innovative solutions being developed by Australian business for the global digital economy.

Another limitation is that FTTB will provide a very limited number of connection speeds and yes, the connection speeds are identified as ‘up to’ meaning that you could be paying for the fastest plan available which is likely to be marketed as providing “up to 100/40 Mbps” and get only 25/5 Mbps.

So what this all means is the average customer will get a very minor speed upgrade to the existing ADSL and the greater majority of customers will continue to get “best effort” traffic with low upstream speeds and because of high prices the benefits of traffic class management and improved quality of service will fail to appear.

Unfair pricing

NBN Co has introduced an unfair pricing structure in the latest revision of its product price list. FTTN/B are sold as ‘up to’ services, in other words, you get “up to 100/40 Mbps”. With FTTP you get 100/40 Mbps precisely.

The question that the Australian Competition and Consumer Commission (ACCC) must answer is why should NBN customers pay the same for FTTN/B as FTTP? And there can only be one answer to this question. Customers should pay for what they get and most Australians on FTTN/B will not get anywhere near the connection speeds of FTTP for the same pricing tier.


MARK GREGORY, Technology Spectator