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Primus CEO: Shutting down copper is 'a really dumb thing to do'

Decommissioning the copper network as part of the NBN plan is not economically viable and will deprive customers of choice, says Mazerski

Shutting down the copper network as part of the National Broadband Network (NBN) plan is "dumb" and a fibre-to-the-node (FTTN) model would work better than fibre-to-the-home (FTTH), according to Primus Telecom CEO, Tom Mazerski.

He took over the role in August after CEO Ravi Bhatia announced his retirement.

Mazerski has a background in economics and has been in the telecommunications industry for 20 years. He spent most of his career in North America and was a long-time employee of AT&T.

One of the reasons he decided to take on the Primus job in Australia was because of the NBN. But while he agreed with the creation of a ubiquitous open access network, Mazerski is opposed to how the Government and NBN Co plans to achieve this goal.

Under current arrangements, NBN Co will be rolling out fibre to 93 per cent of Australian premises while the rest will be serviced by wireless and satellite. Having struck an $11 billion deal with NBN Co, Telstra will gradually migrate customers onto the NBN and eventually decommission its extensive copper network. Optus has also signed a similar agreement worth $800 million.

With copper being phased out, consumers that want a fixed-line broadband connection will eventually have to use the $36 billion fibre network.

Mazerski is against pulling the plug on the copper network.

"My experience says that's just a dumb thing to do," he told ARN. "Somebody is going to have to step up and decide what is good for the customer, not what is good for the NBN, Telstra or any other particular carrier -- even Primus.

"... I would only agree with switching off the copper if it made economic sense and I don't believe it does."

What he doesn't like about this plan is it essentially forces consumers to use fibre and deprives them of choice. It doesn't allow people to say no to fibre even if they are happy with their current arrangements and don't want to go through the trouble of changing services, Mazerski said.

"Fibre is not for everybody," he said. "Those kinds of policies just rub me the wrong way"

There are ongoing concerns that NBN's fibre service will be more expensive than existing copper-based ADSL2+ connections.

Currently there are not enough safeguards to ensure consumers, particularly pensioners and small businesses, will not be sold short, according to Mazerski.

"There should be some policy decisions that say people such as pensioners have to be left alone in terms of price and should be given some sort of allowance to do the [NBN installation] work in their houses so they are not out of pocket or paying for something they don't want," he said.

Small businesses that rely on fax machines -- which operate on copper phone lines - should also be given allowances to upgrade their equipment, Mazerski said.

There should not be a forced fibre scenario, but if there is, customers should be properly compensated, he said.

Ultimately, the Primus CEO doesn't see switching off the copper network as an economically-viable option. In his opinion, it is possible to have a fibre network and a copper network running concurrently.

While he is aware of the logic of shutting down the copper network to diminish Telstra's dominance in the broadband sector, he stressed it does not make economic sense.

"I'm an economist by trade so I think basic economics and cost," Mazerski said. "Then you think about 'who is going to pay for all this?' The same people you're coming to force fibre on.

"At least let them have a voice."

FTTN better than FTTP?

Mazerski formed his current views based on his experiences working in the US telecoms sector.

"In the US, companies went down the [forced fibre] path and realised consumers didn't want it so they did more fibre-to-the-node (FTTN)," he said. "They would build a node to the community, run a fibre there and if people wanted it they can have it but for those that didn't, the copper was left in place."

NBN is currently settled on a fibre-to-the-premise (FTTP) model which has been heavily criticised by the Coalition due to its high cost.

There are some similarities between what Mazerski is proposing and the Coalition's new and improved national broadband plans but he does not explicitly support the Opposition.

Instead, Mazerski wants different areas to be looked at separately to determine if there is a need for fibre in each community. While the economics behind the NBN need to be thought through, customer requirements should not be neglected.

"I don't think it should be a cookie cutter [strategy] and I don't think fibre is for everybody," he said.

Installing fibre in Greenfield estates make sense since there are no existing customers to disrupt, but areas with high numbers of pensioners should be considered, according to Mazerski.

"You look at each area and you do an analysis to decide whether the cost outweigh the customer nuisance," he said. "You might have some instances where it costs more not to shut the copper down but because of certain situations and to please a large group of customers, it makes to just do it that way."

Mazerski claims NBN Co has not done enough to engage with customers to find out what they want.

He proposed doing surveys or polls on customers to find out who actually wants or needs a fibre broadband connection.

"But you don't see any of these in any of the [NBN] policies," Mazerski said.


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