The company responsible for the National Broadband Network (NBN) has said it would upgrade customers[1] from fibre to the node (FttN) to fibre to the premise (FttP) because it is cheaper than alternatives such as fibre to the curb (FttC).
Speaking to the joint parliamentary committee examining the NBN business case, CEO Stephen Rue said the reason for the traditionally more expensive FttP being cheaper than FttC was due to the latter requiring a distribution point unit (DPU) to service up to four homes, with the cost of the unit being spread across homes connected to it.
But if one home is all that connects, it does not remain cheaper.
"When we when we look at a on-demand model, fibre to the premise is more cost-effective because you simply don't know if your neighbors are also going to sign up," Rue said.
"If you're upgrading ... one individual home, fibre to the premise will then be cheaper, but obviously if you then end up doing three, it's more expensive."
Rue added that across the FttC footprint, most distribution points, on average, service approximately 3.1 premises.
Chief operations officer Kathrine Dyer added it was often the case that when placing a DPU into a pit, the pit also needed remediation.
Under the plan announced in September, NBN is expecting around 200,000 premises to shift from FttN to FttP. This includes premises that are upgraded whenever an order is placed for a service that the copper lines are not capable of. The first orders are expected to occur[2] in the second half of 2021.
However, NBN has yet to determine how, or whether, it would prevent customers from ordering a service, getting the upgraded lead-in, and then reverting back