NBN Co's failure to continue rolling out FTTP and to adopt second generation NG-PON2 when it becomes available in early 2016 is discussed in Business Spectator to identify how NBN Co is moving down a path that can only lead to Australia having a second rate obsolete copper access network at a time when our competitors are moving towards all fibre access networks.

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As Australia struggles to complete the National Broadband Network (NBN) utilising  copper technologies the development of new Passive Optical Network (PON) systems has continued and earlier this year the International Telecommunication Union (ITU) approved the most recent version of PON known as NG-PON2, which provides a total throughput of 40 Gbps downstream and 10 Gbps upstream over a single fibre distributed to connected premises.

Early next year countries that have invested in optical access networks will be able to upgrade or shift current access network rollouts to NG-PON2 and gain three clear benefits. There’s a 30 to 40 per cent reduction in equipment and operating costs, improved connection speeds and symmetrical upstream and downstream bit-rates.

The technology is also expected to be about 60 to 80 per cent cheaper to operate than a copper based access network and provides a clear undeniable performance, capacity and price advantage over any of the copper based access networks such as Fibre-to-the-Node (FTTN) or Hybrid-Fibre-Coax (HFC). And this includes any upgrades to VDSL2 with vectoring or G.Fast and HFC DOCSIS 3.1.

NG-PON2 equipment from major vendors will be available in commercial quantities in early 2016 so nations with the foresight to invest in the future-proof optical access network technologies will be able to upgrade PON to NG-PON2 or to complete national rollouts with NG-PON2.  

As far as access network technology is concerned, NG-PON2 is peerless and is likely to be only be surpassed when the next PON upgrade technology becomes available in 2020.

Why it's a better option 

A PON works by sending data downstream to all of the premises connected to a fibre and typically this is between 24 to 32 premises. Encryption is used to ensure that data meant for one recipient is not able to be viewed by anyone else. Data is sent from premises using allocated time slots which are pre-arranged times with varying duration. What this means is that premises are able to utilise more time slots if other premises are not sending data.

To ensure that telephony quality is maintained PON supports four traffic management classes and  this allows for particular types of data such as telephone calls to be given a higher priority than other traffic such as internet browsing.

An important reason why the majority of telcos around the world are investing in PON is the limited future for copper based access networks and the significant cost savings when copper is replaced by fibre. FTTN which utilises VDSL technologies provides up to 100 Mbps over 400 metres of copper. A FTTN rollout involves putting cabinets within 400 metres of premises and connecting the cabinets back to exchanges using fibre.

To upgrade FTTN there are two options, install PON or shorten the copper to less than 80 metres and utilise the G.Fast technology which provides downstream connection speeds of up to 1 Gbps over about 40 metres of copper.

So what this means is that every time copper access networks are upgraded there is a need to run fibre further into the access network, which costs money, and to shorten the copper being used. The prospect of having to send a workforce back into the suburbs to extend the fibre from the nodes down streets past premises, to shorten copper to less than 80 metres and then to install G.Fast is a strong justification to do a PON rollout rather than FTTN or G.Fast because future upgrades would only require the boxes at each end of the fibres being replaced.  

The cost of rolling out FTTN and G.Fast is very dependent on the state of the copper and whether the old telecommunications infrastructure in the street was built with asbestos. Another factor that has led to the widespread adoption of PON is the cost of maintaining a copper based access network with maintenance costs running about 12 times the cost of maintaining a PON access network. And a FTTN copper based access network utilises electricity at nodes and requires batteries to power equipment during power outages adding a further $300-500 million per year to the running costs.

How does it work

If 24 premises are connected to a PON and the available throughput is equally shared then for GPON each connection receives 100 Mbps downstream and 40 Mbps upstream over a maximum of 20 km of fibre. For 10G-PON, which was the second PON revision, each of the 24 connections would receive about 400 Mbps downstream and 100 Mbps upstream. The recently approved NG-PON2 will provide a total throughput of 40 Gbps downstream and 10 Gbps upstream over a maximum of 40 km of fibre so each of the 24 connections would receive about 1.6 Gbps downstream and 410 Mbps upstream.

NG-PON2 provides a greater range of connection speed options including 10 / 2.5 Gbps, 10 / 10 Gbps and 2.5 / 2.5 Gbps. NG-PON2 includes backwards compatibility with GPON to ensure that customers can upgrade when they’re ready.

Another key feature of NG-PON2 is the fibre connections to premises can occur up to 40 km from the Optical Line Termination (OLT) device which can be located at a fibre access node (FAN), many of which are located at old telephone exchanges. The FANs are connected over transit links to larger facilities which house the Points of Interconnect (PoI) to retail service provider networks.

NG-PON2 utilises wavelength division multiplexing which is a transmission technique that utilises four wavelengths at the same time in the downstream and upstream directions whereas the earlier GPON only used one wavelength downstream and one upstream for data. By transmitting data over four wavelengths NG-GPON effectively provides four times the total throughput capacity of GPON.

A clear difference

With the introduction of NG-PON2 there is now a clear difference between optical access network and copper access network capabilities. Investment in NG-PON2 provides a far cheaper network to operate, significantly faster downstream and upstream speeds and a future-proof upgrade path all of which copper access networks do not provide, thus making them obsolete technologies.

Telcos around the world have been carrying out trials of NG-PON2 and major announcements that NG-PON2 will be introduced into networks in 2016 have commenced. Key telecom vendors have rushed NG-PON2 products to market.

The next upgrade to PON will be the 100G-PON around 2020 which is expected to provide total throughput of 100 Gbps downstream and 40 Gbps upstream with backwards compatibility to NG-PON2 and GPON. A key focus for 100G-PON will be to provide a high capacity access network to support the explosion of connected devices expected as the Internet of Things becomes reality.

For nations looking to upgrade from ADSL technologies there is only one logical and financially sound choice today and that is to overbuild with a fibre access network and to utilise PON until NG-PON2 equipment comes onto the market in early 2016.

Mark Gregory is a senior lecturer in the School of Electrical and Computer Engineering at RMIT University.