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News and comments on community broadband networks, the communities deploying them and the technologies that support them. Published by Denise Frey and Al Bonnyman.

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Monday, June 23, 2003

 

"Bright idea is rapidly losing shine" -- more on FTTH in Western Australia

"Bright idea is rapidly losing shine" -- more on broadband in Western Australia

A pessimistic article on Australian utility Western Power's broadband project. The writer calls it an "expensive but ill-thought out adventure".

From what I read it actually sounds like a good idea -- Western Power was in the process of burying distribution lines in Perth suburbs and took the opportunity to place fiber cables in the trenches while they were already open. As a result, per home costs of the system are just $500 (Australian) -- less than $400 U.S. That's much lower than FTTH (fiber to the home) costs in the U.S. for systems that need only a 40% "take rate" (percentage of potential subscribers that actually subscribe) to break even. Since the take rate is the most critical number and source of business risk in this sort of project, it seems to me that the Bright project makes a lot of sense.

On top of that, there's been ongoing frustration that broadband penetration in Australia is low (19th among developed nations) and that the incumbent telco, Telstra, is dragging its' feet in rolling out any sort of broadband services. This project seems like a good place to start doing something about the problem.

Nevertheless, the writer seems to think that the Bright project will fail, in part due to organizational issues within the utility's core business and state politics.

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