Optus, Australia’s second largest telco has today confirmed that it will upgrade its network to offer 100mbps internet, matching a similar commitment from Telstra in November.
Optus will spend AU$25 million upgrading its HFC network in Brisbane, Sydney and Melbourne to Docsis 3.0 by mid next year, bringing 100mbps internet access to 1.4 million households. Notably Telstra’s commitment was only to switch on Docsis 3.0 in Melbourne, where it had previously rolled out capacity but had delayed completing the upgrade following the Federal Government’s announcement of the National Broadband Network (NBN).
Optus is telling the media that it hopes to sell its network into the NBN if and when the Government is ready, although CEO Paul O’Sullivan told News Ltd papers that “we don’t require [a sale] and we don’t need it,” indicating that Optus would be more than happy to retain the assets and compete against the NBN.
The entry of two 100mbps networks into Australia’s largest markets creates a serious challenge to the viability of the NBN, unless the Government comes to terms in acquiring the existing networks. Optus may be favorable but Telstra is saying that it would fight any forced acquisition in the courts, a process that could bog down progression on the NBN for years.
Those years, added to the NBN completion date of 2018 for a 100mbps network, can and will only provide further opportunities for new players to enter the space and offer similar networks, or as the technology becomes available, superior networks, before the NBN can even get to market. The viability of an NBN is reliant on huge take up rates that many experts agree could only be achieved in the absence of any serious competition.