Chapter Nine
Progress on wireless and satellite
Overview
9.1
Overall, the committee received little evidence related to progress on
the wireless and satellite fronts, the next generation technologies which are
supposedly going to service the up to 10 per cent of Australian premises left
out of the 90–93 per cent fibre footprint area.
9.2
The committee is unsure whether the lack of information received reflected
a lack of progress, lack of transparency on behalf of NBN Co and the
Government, or a lack of effective communication to key stakeholders and the
public.
9.3
The committee's main concern is that the design and roll-out of the
NBN's next generation wireless and satellite services does not seem to be being
prioritised by the Government or by NBN Co. The committee is deeply worried
that, if this is indeed the case, regional and remote Australians are set to
remain deprived of effective, affordable, broadband services and essential
telecommunications infrastructure while their comparatively well-serviced urban
cousins receive all the benefits of Fibre to the Premises broadband services.
Evidence received
9.4
Of the evidence that was provided to the committee, the two primary
concerns raised were that:
- the lack of information available is compromising investments in infrastructure
and forward planning by businesses and end-users; and
- regional and remote Australians' needs are being deferred until
after the fibre network is rolled-out, or at least substantially progressed.
Lack of available information
9.5
The Australian Communications Consumer Action Network described how the
lack of information is a key concern for prospective end-users who may be in
the 10 per cent:
Ms Corbin—With the National Broadband Network we have got
100 megabits per second in some areas and a lot less in some remote
spaces. So we are getting a lot of feedback from those people who believe they
are going to be in the 10 per cent. What should they expect if their service is
being delivered by satellite or wirelessly?
Senator FISHER—I am not sure they know enough about the
government’s promise in that respect to even start to work out what they are
entitled to expect, do they?
Ms Corbin—That has been a massive problem too.[1]
9.6
AUSTAR United Communications, describing itself as regional Australia's
leading subscription television provider, suggested that the current approach
is prioritising the roll-out of fibre in urban and metropolitan centres in a
way which is detrimental to not only the 10 per cent who will ultimately be
outside the NBN's fibre footprint, but also those who may ultimately get FTTP
but will have to wait until towards the end of the NBN's eight-year roll-out to
receive those fibre-based services:
Since our original Senate Select Committee response nine
months ago, AUSTAR has refined its views on how a 4G wireless broadband network
could play an integral part in the rapid roll-out of NBN level services to
regional and remote parts of Australia. Regional and rural Australia remains a
broadband backwater, and we continue to be concerned by the potential delay, by
years, of a fibre roll-out to most of our market.
AUSTAR holds the 2.3GHz and 3.5GHz spectrum licences within
regional areas, and we believe the short- and long-term benefits of a wireless
solution should not be overlooked in the buildout of the NBN. The NBN will
strive to connect as many homes as possible to a fibre network, but wireless
will offer speeds beginning at 12Mbps and growing to 100Mbps+ with technologies
being developed around the world compatible with AUSTAR’s spectrum holdings.
Wireless can be rolled out much more quickly and at a much lower cost than
fibre technologies, and in markets where it will eventually overlap, will be a
complementary consumer offering.[2]
Update from NBN Co on progress
9.7
At the committee's hearing in Canberra on 15 April 2010, Mr Michael
Quigley, CEO of NBN Co, provided the following update on progress:
We are also working on the satellite and wireless solutions
for the approximately 10 per cent of premises not covered in the fibre
footprint and, in providing those radio solutions, the dimensioning becomes
even more important...we have got to provide committed information rates. To
implement the architecture and the designs we are doing, we will of course
procure a range of equipment and capabilities.[3]
9.8
Subsequently, Mr Quigley indicated that although NBN Co may be 'working
on the satellite and wireless solutions', when it comes to working out the
wholesale pricing of wireless and satellite services, those are matters NBN Co
is deferring until after fibre-prices have been settled:
If you are talking about trying to get a uniform price across
the country, our first step is to try to make sure we can design the network to
get a uniform price across the fibre footprint, which is where we are focusing
the attention at the moment. We will then come to the wireless and satellite
parts of the network and try to do likewise. But remember: we have to do all of
this in consultation with the ACCC. Even for Tasmania stage 1 we consulted with
the ACCC to make sure that when it comes to pricing issues we get guidance from
the regulator.[4]
9.9
In response to a question on notice, NBN Co provided further details of
their progress on wireless, stating:
The wireless network design for the remaining 10% has been
progressing with investigations into a range of factors including:
- Spectrum options for the wireless
network;
- Technology choices (eg. LTE or
WiMax); and
Workshops have been held with potential technology vendors
but no formal technology procurement process has been initiated (as is the case
with the fibre and satellite networks) as the technology choice will depend on
the outcomes of the investigations above.[5]
9.10
In relation to satellite, NBN Co explained:
The satellite network design is progressing based on an
assumption of NBN Co launching a minimum of two satellites in the 2014/15
timeframe to provide broadband services to premises in the non-fibre and
non-wireless areas. A formal procurement process has commenced with a Request
for Capability Statement released in January 2010. Responses to this RCS are
being evaluated and it is our intention to release a Request for Proposal later
in 2010.[6]
Commentary from the Implementation
Study
9.11
The Implementation Study, released on 6 May 2010, contained significant
discussion on the challenges and options available to the Government and NBN Co
in terms of next-generation wireless and satellite services. In a chapter
titled 'Ensuring national availability of high-speed broadband', the
Implementation Study recommended that the fibre footprint be extended to 93 per
cent of premises (up from 90 per cent), that another four per cent of premises
(the 94th to 97th percentiles) be serviced by wireless operators
(following a yet-to-be-started Expression of Interest and tender process that
may ultimately be unsuccessful anyway), and that the final three percent (the
98th to 100th percentiles) be serviced by a satellite program
yet to be launched by NBN Co.[7]
Committee view
9.12
In the absence of any compelling evidence to the contrary, the committee
can only assume that the Government and NBN Co have not come up with a business
plan or decided upon a final course of action.
9.13
In terms of the proposals contained in the Implementation Study as a way
forward from the mess the Government has created, both the wireless and
satellite solutions proposed by the Implementation Study, as discussed in
chapter two, already depart from the Government's objective of delivering at
least 12 Mbps to the final ten percent.
9.14
Although these premises were already, under the Government's initial FTTP
announcement, going to be receiving substantially inferior services to those
premises serviced by fibre (speeds of 12 Mpbs as opposed to the up to 100 Mbps
promised for fibre), the Implementation Study's recommendation is to extend the
discrepancy even further, recommending that the 12 Mpbs speed be redefined as a
'peak data rate target'.[8]
In practice, this means that those on satellite services might expect a mere
300–400 kilobits per second (kbps),[9]
which equates to just 0.3–0.4 Mpbs.
9.15
To add insult to injury, the Implementation Study then recommends that
an 'entry-level service' for satellite services should be provided 'with a
lower peak data rate and average data rate' of just 6 Mpbs and 200 kbps
respectively and that this should be 'priced at a comparable level to
entry-level fibre and wireless products'.[10]
Such a suggestion translates into those Australians in the three percent of
premises covered only by satellite solutions being asked to pay the same
'entry-level' price for what is a vastly different service to that available on
fibre. While the entry-level fibre service is likely to provide (and the
Implementation Study recommends that it does provide) committed speeds of
20Mbps, the entry-level package for satellite services will provide an average
service speed that is one one-thousandth (or 0.1 per cent) of what is available
for the same price on fibre.
9.16
Additionally, the wireless solution proposed by the Implementation Study,
as discussed in chapter two, is not actually a solution. Rather, what the
Implementation Study proposes is that the Government conduct an as yet
unstarted Expression of Interest and then tender process for a commercial
provider to build and operate a fixed-wireless network.[11]
In the absence of an acceptable bid, the Implementation Study proposes that NBN
Co 'be required to build the network and offer services on a wholesale-only
basis'.[12]
Translated into reality, the effect of that recommendation is that even the
watered-down next-generation wireless services trumpeted by the Government as
such an improvement on the current services available to rural and remote
Australian premises are years away. And presently, no-one is even sure what the
solution will actually end up being in any case.
9.17
Finally, the committee notes that even if the Government does follow the
Implementation Study's recommendations and seeks to have next-generation
wireless and satellite services operating at some future point, there is little
in the Implementation Study which suggests these will ever be commercially
viable without significant government subsidies. The Implementation Study is
largely silent on just how large and ongoing those subsidies will need to be. What
is clear is that large subsidies akin to those provided under the current
Australian Broadband Guarantee program[13]
will remain a fixture of the commercial and government funding landscape.
9.18
The committee repeats its calls in previous chapters of this report
that the Government immediately provide a response to the Implementation Study
and that the Government and NBN Co also provide a detailed business plan for
how, when, where and for how much the NBN will be rolled out throughout the
entirety of the nation.
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