Broadband backwater

The advent of the internet 15 years ago changed the way people looked at global communications. Back then, a router forwarded data packets across a network towards their destinations. Routing occurred at layer three (the network layer) of the OSI even-layer protocol stack.

Today, however, with the ratification of new technology like ADSL, broadband uptake has increased to a point where in Australia, more than three million broadband services are now connected, according to an Australian Competition and Consumer Commission (ACCC) report released in March.

The number of those subscribers is expanding at a reasonable rate, and the market has to deal with issues including competitive prices for such high speed services and new applications such as IPTV and VoIP over broadband.

But compared to other nations, Australia continues to remain a broadband backwater. Independent telecommunications expert Paul Budde says one of the main obstacles to realising the country's true potential in broadband technology is Telstra.

He believes Telstra has to acknowledge public demand soon and bring itself into the forefront of broadband. "I had thought [Telstra CEO] Sol Trujillo would use his time in office to announce a shift in strategy. I had also predicted that part of Telstra's turnaround would be an aggressive launch of its ADSL2+ service, based on a triple-play model, which would include a VoIP and a broadband video offering."

However, that has not happened and as far as Telstra is concerned the telco giant is providing the best broadband services it can - a belief not adhered to by industry experts. "Telstra will upgrade when they have to and it will roll out fibre networks when it sees fit. The telco is running three years behind other countries. What we are going to see is the niche service providers in the market take fibre networks into housing estates and into regional areas," Budde says.

"These niche providers will also be able to provide plenty of broadband applications, which can be run over the network going through the old telephone network. The future of services and the thousands of applications that can be run will come from these service providers."

Simon Hackett, managing director of SA-based service provider Internode, says the only reason the Australian market is seen as lagging behind the US, the UK and some Asia Pacific countries is because organisations like the Organisation for Economic Cooperation and Development (OECD) focus on what Telstra is doing and the technology it is offering.

"Telstra is the giant marketing machine that has dominated the media. It is able to give the world the perception that without it no other provider is able to innovate technology," Hackett says.

"That's not true. If you ignore the machine that is Telstra you can see there are service providers like Unwired, Optus, iiNet, Powertel and Pacific Internet offering speeds and technologies far ahead of what Telstra claims is its best effort in providing broadband technology."

Niche service providers

Pacific Internet managing director Dennis Muscat says there are a lot of niche service providers out there quietly doing what Telstra has been failing to achieve - offering faster speeds and services to customers.

"The local broadband market can be split up into two segments: one targeting home and the other business," Muscat says.

"I believe business has maximised the potential of broadband because these companies are seeking wireless for mobility and looking for applications to run over the technology."

However, the residential sector still lags behind because of lack of real competition from Telstra. Muscat says others are trying to build alternative networks but they can never achieve network level on Telstra's scale.

"Australia has generally fallen behind the rest of the region, with OECD figures showing the country is below Canada, Korea and Japan, and lack of competition and investment is highlighted. I think if think if the broadband market was put on a scale between one and 10, we are around three, maybe-three-and-half," Muscat says.

However, broadband packages for business are catching up with the rest of Asia Pacific, Muscat says, and are driving the need for innovators to come up with ways to use broadband to help communication between franchises.

Muscat says companies want to be able to run more applications over a broadband connection, even, potentially, applications to control business like sales automation tools or applications to move information.

"The business sector is continually driving the need for a steady connection to the front door of their company. It's very much like how the telephone once drove business; now it is the internet," he says.

However, the issue of speed is very much on everyone's mind, an issue Budde believes, that is driving Australia to be "well and truly on the road to catching up with the rest of the developed world".

"Internode offers the country's fastest commercial broadband service to customers connected to the East Sydney telephone exchange. ADSL2+, the next generation of ADSL broadband, delivers services with download speeds as fast as 24Mb/s depending on your equipment and the length of the copper line." According to Budde, Telstra's top-speed broadband plan is 1.5Mb/s; another smaller Telstra competitor is offering a 12Mb/s service.

This is a sentiment echoed by Michael Malone, managing director of service provider iiNet. The ISP has gone through some tough times recently and has had to withdraw its 'medium' ADSL1 plan from sale, and has continued to downgrade plans for customers on Telstra infrastructure. "That's only on Telstra's infrastructure. What people don't understand is we are currently rolling out our own 24Mb/s in Perth and Sydney," Malone says.

"A lot of resellers and service providers are increasing their broadband prices for packages based on Telstra's infrastructure."

The latest variant of ADSL, broadly available to the local market for the past couple of months, according to Malone, is ADSL 2+, which provides higher downstream rates of up to 12Mb/s for spans of less than 2.5 km (8000 ft). Flexible framing and error correction configurations are responsible for these increased speeds.

The difference between the two technologies is ADSL 2+ can boost rates up to 24Mb/s for spans of less than 1.5 km (5000 ft) by doubling the downstream spectrum upper limit to 2.2MHz.

It can also offer seamless bonding options, allowing lines with higher attenuation or lower signal to noise ratios (SNRs) to be bonded together to achieve theoretically the sum total of the number of lines (up to 50Mb/s for two lines), as well as options in power management and seamless rate adaptation - changing the data rate used without requiring to resynchronise.

According to Malone, the broadband market can be compared to the mid-1990s where there were dramatic cost reductions in long distance, and everyone was reselling Telstra, which had a short-term benefit and then the market was wiped out.

Malone believes there is an advantage in owning your own network - only resellers of Telstra are feeling the pinch in the marketplace.

"There is a second wave of reselling with service providers such as Optus and Powertel. In our neck of the woods there's Westnet; these guys have been here year after year by continually adding to their services. Also becoming a national reselling network like Pacific Internet's business network can provide an alternative stream of income," says Malone.

"The real question with 30 percent of connected households is no longer on the plumbing but what you do with it. There's VoIP, IPTV and video-on-demand steam rolling their way into the home," he says.

Budde believes IPTV is much more than Hollywood movies, premier league sport and TV in general. "Regional players could make local and regional video services available (local museums, events, local government, and so on)," he says. "Market-based ISPs could also offer triple-play models based on their customers' profiles."

Video-on-demand moves broadband beyond the PC, "and the race is on to link digital video recorders (DVRs)", says Budde.

"The best example of this is the Netherlands. TV rights to the Dutch Premier Soccer League are bought by broadband suppliers. This has spearheaded the Dutch into second position, trailing only Korea on the OECD broadband penetration list," Budde says.

Malone believes the market is a year away from making these services a standard. There are some trials of it now, but the general problem with video-on-demand is not the speed suppliers can get it to the customer but the issue of getting it from the computer and then quickly into the lounge room. However, Malone feels "set-top-boxes are still not up to scratch".

Out of these technologies VoIP has made a big entrance into the Australian market and according to the experts it is here to stay.

Gary McLaren, AAPT's IProvide director of marketing and products, sees broadband as the enabling technology for a range of applications for the SME market that his company is serving with its partners. "The increased speeds on offer (especially the upstream speed increases with ADSL2+) will make it easier to deploy quality VoIP and video over IP services to businesses," he says.

"At the moment we are using standard ADSL and G.SHDSL to deliver high quality business grade VoIP to businesses with four to 45 PSTN equivalent lines. With the enhanced speeds of ADSL2+ this will naturally be able to be increased but will also allow more services to share the link at the same time," he says.

"Companies will be able to participate in videoconferencing and other real-time interactive media dialogues with their customers, employees and suppliers."

McLaren says in his experience businesses will pay for these services once they understand the benefits and the return on investment. Clearly this comes down to the way businesses use the technology to increase their productivity and save costs elsewhere in their business.

Taking it home

Internode's Hackett believes that for IPTV and video-on-demand to come into fruition in the home sector, Telstra needs to look at building a fibre-to-the-home (FTTH) network. FTTH is a fibre connection leaving an end office or exchange and connecting directly to a home or premise without a DSL or LAN connection in between.

There are currently more than 900 cities/communities with FTTH deployments in the US. In that region the number for the service grew by 34 percent during the second quarter and 66 percent since the fourth quarter, 2005, according to a report released from Ovum-RHK.

The report shows the 463,000 FTTH subscribers put the US second only to Japan in FTTH penetration. At the end of the first quarter 2006, Japan had more than 5.4 million FTTH subscribers.

Hackett says Telstra decided recently to scrap its decision to for a fibre-to-the-node network (FTTN) upgrade, despite media reports. This "came as huge sigh of relief to service providers in the broadband market".

Telstra declared it will no longer build a new $4 billion fibre optic network after negotiations with the ACCC broke down. The telco says the talks with the ACCC about the FTTN had reached an impasse over costs. "What basically happened was Telstra realised no-one was going to cave into their demands. FTTN would have meant the telco would have the cable network back in their control," he says.

"This would have allowed Telstra to box in the network and service providers who wanted to build their own infrastructure on top of that cable. They would have had to pay Telstra whatever price the telco wanted for use of the cable," he says.

Hackett says all the money Internode and other service providers put into the infrastructure used to provide broadband services to customers would have been destroyed, along with it these companies. "What Telstra should be doing is lead the way in broadband technology. All the money it wanted to invest is FTTN should have gone into a FTTH," he says.

Threats to the connection

The burgeoning growth of broadband also brings with it a whole new suite of security concerns, over and above the normal use of the internet. A legitimate concern of any diligent CIO is whether the introduction of a wireless technology could weaken the integrity of their IT network, leaving it vulnerable to a new class of security attack.

These threats broadly fall into the following two areas: loss of information and unsecured access to a connection.

The first point to address is the notion that wireless is an inherently less secure medium than wired solutions. If no encryption is used, information is transmitted 'in the clear'. This means that anyone with the ability to tap into a wireless connection will be able to 'listen in' on the communication. This situation occurring can be as simple as a user not being aware of this type of risk and not enabling encryption on their link.

However, users should also be very wary of logging on to unknown or 'rogue hot spots' where public internet access can be obtained. Often there is something more sinister at work here with plenty of documented cases of hotspots set up with the malicious intent of capturing information by stealth.

Since wireless LANs allow peer-to-peer connections, the computer-savvy guy at the corner table may be able to connect to your notebook and 'mooch' your internet connection, look at your unprotected files, or hitch a ride as you connect to your corporate LAN. He can also eavesdrop the airwaves with one of the many wireless sniffers available on the web and watch as you unintentionally reveal your corporate network log-on information, your credit card numbers, IP addresses of your connections and even the contents of emails, instant messages and file attachments.

Those using private networks to connect to wireless broadband such as the services provided by Unwired, IBurst, Vodafone and others are working in a much more secure environment. These services tend to use multiple levels of encryption and authentication to protect their users. The solutions are standards-based and have been architected to overcome known security attacks. Specifically, the architecture is immune to known Wi-Fi attacks. Still, there are some rare but perhaps growing examples of attacks on these systems.

According to Tom Chan, security consultant at MessageLabs, the success of digital mobile communication systems leads to a larger interest for fraudsters, especially as the opportunities for attacking other systems are dwindling. Thus, it can be expected that there will be more investment by the fraudster on more complex equipment, which may lead to new active attacks becoming more of a concern.

"Primarily the fraudsters are manipulating the signalling on the radio interface or masquerading as a network element in order to mount various forms of attack (so-called 'false base station' attacks)," Chan says.

"This is where authentication is not strong and allows unauthorised access to your private wireless connection. The repercussion could be as simple as someone using the link to download porn all night using your bandwidth, or perhaps hijacking the connection to send out spam or conduct other nefarious activities."

According to Chan users should consider that someone smart coming in via this wireless connection can bypass your firewall and hack into your PC or LAN.

Also, remember that going through the public internet via a wireless connection means that you will be exposed to all of the traditional nasties on the web.

Addressing the problem

One way to address this is with software or devices. However, these are less than ideal in that their update behaviour leaves a window of vulnerability.

"A tip for users is that the VPN provides strong authentication and encryption when using a public wireless internet connection. VPNs are effective because they provide end-to-end (corporate server to client terminal) security without the need to have concern about the integrity of the transport networks in-between."

Muscat agrees, and says businesses want security above speed when it comes to broadband. "If you are a SOHO or SMB running a company out of your home and have all your broadband connections running on one network, then you open yourself up to potential problems," he says.

"If just one of the PCs running in private home entertainment gets a virus your business information - like customer invoices and data - also becomes vulnerable. Running a separate line for a business and home is the sensible thing to do, because a business network offers users a VPN to protect their assets."