Digital Home Advisor

The ability to bundle multiple broadband services and avoid fixed line rental has seen naked DSL emerge as the next cash cow for some ISPs, who want to see the service evolve into their flagship product.

But whoever wins the RFP for the new National BroadBand Network could have a significant impact on the fate of naked DSL, according to a senior telecommunications analyst.

BBY analyst Mark McDonnell, who also works for the ATUG's information services, points overseas to markets like Japan and North America where the rate of new DSL connections is falling and being replaced by Fibre to the Home (FTTH).

He sees this as a "very important" trend at a point when the Australian government is leaning towards a fibre-based broadband network.

"Stephen Conroy is explicitly putting FTTH or FTTP as an alternative to FTTN. So when you ask me specifically about DSL I think it's going to depend very much on things like who wins that tender; whether FTTH or FTTP architecture is deployed; and how much of a lag will exist from Australia relative to the rest of the world in starting to see DSL become yesterday's technology and be replaced by full fibre connection," McDonnell said.

It [naked DSL] has to run on copper, and if copper is going to be retired out of the networks, then that's the end of DSL

Mark McDonnell - BBY analyst

The short answer is that nothing is likely to happen in the near future, as the tender negotiation process and potential for subsequent challenges could take a considerable amount of time. For McDonnell the biggest question is - with DSL having always been seen as a transitional technology, what is its timeframe for ongoing and continuing deployment by ISPs?

"It [naked DSL] has to run on copper, and if copper is going to be retired out of the networks, then that's the end of DSL. Look at the rest of the world -- people are moving to fibre. Fibre in the local loop, not just fibre to the node. So where does VoIP fit in all this? I think the experience we've had is that neither Telstra or Optus are actively promoting it, both of them see it as a threat.

"I think the same is true of AAPT although they've been less vocal about it, so it's been left to ISPs to try to develop this and the take-up rate has been fairly small. As a general observation what we have seen and what has been reported by people like the ACMA of late is that a lot of people know about VoIP, but actually very few people are using it," he said.