The composite measure takes into account three indicators: household broadband penetration, average speed weighted by percentage of subscribership (Mbps), and lowest available price per Mbps.
While our household penetration is very good ranking us in ninth place, and our pricing is excellent with a ranking of sixth; its our average speed which is of most concern. Of the thirty OECD nations which take part in the Broadband rankings, we are ranking twenty sixth on speed, just above Mexico, Greece and Spain.
What is most worrying is the state of the NBN proposals from the major players, and their continued focus on FTTN. Back in April I wrote an article on the Myth of FTTN and how the current proposals would not meet the performance targets announced by the Government in their 2007 strategic paper and policy launch. More importantly those proposals will not keep Australia competitive in terms of the Digital Economy. To achieve a competitive performance target of 50/12Mbps every home would need to be within 500 metres of a node. If that were achieved today the bandwidth would put us third on the OECD list. However, the current proposals are for every home to be within 1500 metres of a node, giving subscribers an average speed of 18/2Mbps.
If you look at the bandwidth growth over the past 3 years, by the time we start to roll the NBN the top 5 (currently Japan, Korea, Finland, France and Sweden) will be well passed our MAXIMUM capacity, and the top 15 (USA, Denmark, Netherlands, Norway, Switzerland, Greece, Iceland) will most likely be passed that point with their rapid growth in FTTH deployment.
One only has to look at the USA where 2 years ago their average speed was 1.5Mbps. They now are averaging close to 8Mbps. Back then the MAXIMUM speed on offer was 20Mbps on either cable, copper or Fibre. However Verizon through their FiOS product is now offering 100Mbps in some areas and the number of connected customers has doubled. Even the MSOs have doubled their speed offerings (abet introducing download limits) in that same time, and the upgrade to DOCSIS 3.0 is only just starting. My prediction for the USA is within 2 years their average will be 30-40Mbps.
So much for being competitive in the Global Digital Economy.
3 comments:
- At 15 September, 2008 16:15 Anonymous said...
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Stephen,
I'm afraid the average speed, as measured by both the ITIF and the OECD, is a meaningless measure.
It is derived like this:
- take a survey of plans on offer
- work out the average speed of the plans.
This is, therefore, not a measure of:
- what the consumer is buying; or
- what "real" speed the end user experiences.
The problem isn't yours, SD, but the ITIF's methodology (and upstream, the OECD's). It's like saying "the average car is the average of all models in all manufacturer's books", rather than measuring the cars actually sold. - At 15 September, 2008 18:40 Stephen Davies said...
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Thanks Richard,
I agree it is certainly not the best unit of measurement. However it is consistant unit of measurement across the world.
The anicdotal evidence certainly suggests a similar position, with many of the top nations already having large Fibre deployments. Japan for example now as of July 2008 has more FTTP subscribers than DSL subscribers. Thus the reason they are at the top of the table. - At 18 September, 2008 16:11 Anonymous said...
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Stephen, regards from Citynet Spain. I don't know about Australia, but the Spanish law allows service providers to supply 'as much as' 10% of the advertised speed. This is, I have a 6 Mbps plan and I never get more than 500 Kbps, this is, not even a 10% of the theoretical speed. Being this the case, measures should be performed at user's home, taking a sample enough to extrapolate the results to the universe of users.
