A report commissioned by a consortium of Telstra competitors has criticised Telstra's FTTN proposal, saying it is "an ideal technology for an incumbent with anti-competitive ambitions."

The consortium contains big-name companies AAPT, Internode, iiNet, Macquarie Telecom, Optus, Powertel, Primus, Soul and TransACT.

The 15 page report (PDF) produced by The Allen Consulting Group and dandolo partners offers one view on why Telstra is pursuing the FTTN network and what effect it could have on broadband in Australia.

The report's main arguments are that the FTTN network would cover less than half the country, would return local loop monopoly to Telstra and would damage broadband competition by reducing access to an unbundled loop.

"We believe that a significant motive for Telstra's proposed FTTN rollout is to see off the competitive threat posed by ULLS-based competition, and to do so in a manner, and using a technology, which will allow it to re-establish a monopoly market structure for broadband in Australia", it explains.

A common criticism by Telstra of competitor's DSLAM rollouts is that they are "cherry picking", because they only upgrade exchanges where the majority of customers are. Interestingly, the report turns this argument against Telstra, saying that the FTTN network is no different. "Telstra is proposing to include the most lucrative and easy to serve, densely populated areas in the FTTN network", or "cherry picking the most attractive markets", it claimed.

An alternative to Telstra's FTTN model is set to be released by the consortium in the coming weeks. Telstra has previously called the idea "a self-serving plan to rip-off Telstra shareholders and taxpayers" and has refused to become involved, while some industry commentators considered it a stunt.

Links:

• Telstra's FTTN Proposal: Key Policy Issues  (The Allen Consulting Group and dandolo partners, 28 Jun 2006)
• Telstra competitors propose open FTTN network  (Whirlpool, 21 Apr 2006)
• iiNet interested in joint FTTN network  (Whirlpool, 24 Apr 2006)
• Telstra wants copper all to itself  (Whirlpool, 16 Nov 2005)
• Telstra announces Next-Gen Network  (Whirlpool, 15 Nov 2005)