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Government to fund NBN boost for regional areas

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Communications Minister Paul Fletcher announced the rural NBN upgrade for the upcoming Budget (Image by Dan Jensen)

While the Government will be spending money to upgrade the NBN in regional areas, this may come with a new set of problems. Paul Budde reports.

WITH THE ELECTION LOOMING, money becomes available, especially for those projects that are drawing a lot of criticism to the Government and the NBN certainly is one of those areas. Predictably, the NBN is receiving a boost in the upcoming Budget.

The Government has indicated that it will invest a further $480 million in the wireless fixed and the satellite network. The total cost of this network upgrade is $750 million, with the remaining $270 million being contributed by NBN Co out of its own funds.

Both these networks have been underperforming because of a shortage of capacity in these networks. The extra money will most certainly address that issue and thus improve the services. The upgrades aim to lift the quality of the network – measured at the busiest time of the day, being 8 PM – from 6 Mbs to 50 Mbs, at no extra cost to the users.

Here are the highlights:

  • The fixed wireless footprint coverage will be expanded by up to 50 per cent, enabling 120,000 additional premises to access fixed wireless services instead of Sky Muster satellite services.
  • As a result, up to one million premises in regional, rural and remote Australia and in peri-urban areas will have access to higher speeds on the NBN fixed wireless services or greater data limits on Sky Muster services.
  • This upgrade will see NBN offer new higher-speed services to the fixed wireless network: 100 Mbps to all 750,000 premises able to access the new, expanded coverage footprint and a 250 Mbps service will be available to 85 per cent of premises.
  • The fixed wireless service will use the latest 5G millimetre (mm) wireless technologies. Rooftop mm antennas will be added to the infrastructure, this allows for the extension of the coverage range from a tower to around 29 kilometres. As a result, this will allow higher speeds for everyone serviced by an upgraded tower.
  • As more people can now be serviced by fixed wireless, fewer people will then be using the satellite service. This allows for the freeing up of more capacity for the remaining NBN Sky Muster users resulting in higher amounts of data for them. The footprint of Sky Muster will be reduced by more than a third.
  • Average monthly data allowances for standard Sky Muster plans will increase to 55 GB in the short term, increasing to 90 GB once the fixed wireless upgrade is complete in around two years’ time.

Of course, all good news for the users in regional, rural and remote Australia, who have been desperately waiting for better NBN services.

However, both these two technologies can easily hit a new barrier if people take up the opportunity and use these networks more — what I most certainly expect. Because of the often poor service, usage has been relatively low among those users as people couldn’t be bothered with the slow services they received, so these people are going to use the NBN more and for higher quality services (such as video).

The recent Regional Review very specifically addresses the underlying strategic issues of broadband services in these areas. Just throwing money at the network is not enough — we need to map the blackspots better, the uncovered areas, the marginal areas of the service footprints.

Once we have such a map, we can link this to the usage patterns in these areas and as a result, much better-targeted upgrades can be provided there where they are needed. I am always worried with election handouts that those strategic issues are left behind and that we thus move on to the next crisis.

Obviously, the government handout will also be scrutinised by NBN Co’s competitors who also provide 5G service and others who operate commercial satellite services.

By upgrading the fixed wireless and satellite services, NBN Co also undermines the opportunities from companies that are using low Earth orbit (LEO) satellites – such as Elon Musk’s Starlink service. The upgrades will start reaching the speed levels of the LEOs at much lower costs, so customers will vote with their wallets. The LEO opportunities are thus further pushed back into the remote corners of Australia, this, of course, if NBN Co can deliver on their promises and maintain a high-quality service in the future.

Paul Budde is an Independent Australia columnist and managing director of Paul Budde Consulting, an independent telecommunications research and consultancy organisation. You can follow Paul on Twitter @PaulBudde.

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