news NBN Co has published an extensive report of the satellite and wireless aspects of its infrastructure rollout, finding that it will need to slightly delay its planned late 2015 satellite launch until early 2016 and that its current provisions for wireless broadband in outer metropolitan and regional areas is not quite adequate to serve its planned user base.
The two major sides of politics differ drastically in how each would prefer to provide faster broadband to the majority of Australians. However, when it comes to the remaining seven percent of the country — predominantly located in rural, remote and outer metropolitan areas — both sides are in agreement that satellite and fixed wireless technology should be used to serve the needs of premises in that footprint.
This afternoon NBN Co released a landmark report (PDF) into the satellite and wireless aspects of its infrastructure rollout. The report was prepared directly by NBN Co (led by chief strategy officer JB Rousselot) with assistance by consulting firm Boston Consulting Group, which was previously involved in the company’s more Strategic Review released in December last year.
The report found that if NBN Co were to continue along its current construction path in the satellite and fixed wireless footprint, around 200,000 of the planned one million premises in the footprint would not be able to be served with faster broadband.
According to Labor’s original National Broadband Network policy, all of the premises in the satellite and fixed wireless footprint were to have been covered by NBN Co’s infrastructure. However, NBN Co’s satellite and wireless report published today alleged that NBN Co had only planned for a certain level of take-up of the infrastructure. Out of the million premises, NBN Co’s report stated, the company had initially only planned for about 230,000 premises to take up its broadband services.
The report states: “The Review believes that take-up will likely be 2–3 times higher and that between 440,000–620,000 connections will be required across the footprint. While fixed wireless towers can accommodate some of the higher demand, at the higher take-up expected, ~200,000 premises would not be able to be served by NBN Co.”
Part of the problem is that NBN Co does not currently hold sufficient wireless spectrum rights in urban fringe areas, with other mobile telcos such as Optus owning some of the rights. “As alternative spectrum has not been secured, NBN Co has a spectrum gap in the urban-fringe zone around Canberra and the five mainland State capital cities,” NBN Co’s report states. This problem affects about 80,000 of the total 200,000 premises shortfall.
In addition, NBN Co’s report found a number of other problems. Its two satellites had planned to be launched in the third quarter of 2015, but are now expected to be launched in early 2016; its satellite products in general need a “more robust product construct” including a fair use policy, and the fixed wireless rollout program is behind in general.
In addition, NBN Co’s “functionally siloed organisation” had inhibited visibility and effective decision-making processes in the satellite and wireless areas, the report found.
To deal with the issues, NBN Co has recommended several possible solutions, both of which revolve around upping the mix of premises served by the company’s fixed wireless network (and deploying significantly more wireless towers — likely between 600 and 1,300 more than the current 1,400 planned) as well as deploying Fibre to the Node to a small percentage (between one and three percent) of the original one million premises outside NBN Co’s fixed-line footprint. It will also need to work with the Australian Communications and Media Authority and other telcos on securing additional spectrum.
NBN Co has considered the option of a third satellite, but does not appear likely to go down that path, and it has also considered the possibility of partnering with another telco to deploy extra satellite capacity. Either move will cost more — up to $1.4 billion, but it does not appear as though either move will have cost implications for NBN Co beyond the company’s already committed capital envelope.
Communications Minister Malcolm Turnbull has issued a statement noting the release of the report. “The advice contained in the Review is being considered by the Government and will assist in the Government’s consideration of the NBN Co Corporate Plan, due to be submitted and considered later this year,” he wrote.
“Importantly, the high-level assumptions align with those made about the non-fixed line footprint in the December 2013 Strategic Review. This means that there are no further changes to the peak funding requirements if NBN Co were to implement the recommended approach.”
It has been speculated recently that NBN Co might seek to sell off its satellite infrastructure, especially. However, the review found there was only limited immediate benefit to NBN Co changing any ownership arrangements of the satellite and wireless networks, although further options could be explored in future.
opinion/analysis
No doubt readers will see a huge wave of coverage surrounding the release of this report. In the press conference in Sydney today, journalists from both mainstream and minor media were asking a whole host of questions about the report and its implications; several of whom appeared to have already taken a decidedly antagonistic approach to specific issues mentioned in the document.
NBN Co itself has hyped up the release of the report as stating that broadband connections in the bush are to “triple” … despite the fact that Labor’s original broadband policy called for 100 percent of the population to be covered, no matter where they lived. And while Communications Minister Malcolm Turnbull didn’t show up to the press conference today, his Parliamentary Secretary Paul Fletcher did, and predictably blamed the entire situation on the previous Labor Government.
However, from my point of view, it’s a little hard to see what all the fuss is about. Sure, NBN Co might have to build a fair whack more towers as an outcome of this review. Its satellite service will be delayed a little, and the end user services will be subject to fair use policies. It will have to work with the ACMA and other telcos on access to wireless spectrum.
But the whole situation is hardly a disaster. What we’re seeing here is something in the vein of a ‘mid-course correction’. When NBN Co initially put together its satellite and wireless plans, it assumed a certain scenario. Now the company is seeing heightened demand for its infrastructure in the bush (why that should surprise anyone, I don’t know) and issues garnering the required wireless spectrum (again, hardly a surprise in Australia’s increasingly spectrum-constrained environment). As a result, it is having to upgrade its rollout plans.
But with both its wireless and satellite infrastructure rollouts trucking along not terribly, with the expansion requiring no real capital injections (despite the claimed billion dollar cost “blowout”, which after all is only a tiny two percent of NBN Co’s projected total capital needs) and with continued growing demand for its services, it’s hard to see a huge downside to all of this. It feels like NBN Co’s satellite and wireless report released today is a realistic look at the challenges which any major telco would only discover when it was mid-way through any major network rollout project.
It’s hardly the disaster which the Fairfax and Murdoch press have been promising us for months, and it’s hardly an indictment on Labor or the management of previous NBN Co chief executive Mike Quigley. This is reflected in the surprisingly sober statement which Turnbull himself issued today about the report.
The thing I sometimes love about the NBN project as a whole is that despite all the bluster coming from the Coalition about it, sometimes the deep analysis being conducted about NBN Co, especially by the consulting firms involved (who, despite the best intentions of their political customers, sometimes just have to tell the truth) broadly shows that the company’s founders — Quigley and his executive team, the ones that have now resigned or been sacked — were really pretty much broadly on the money in terms of their plans for the network rollout. Many things have gone wrong, but definitely within a manageable scope.
NBN Co’s Strategic Review showed this — proving that it would be possible to deploy universal FTTP around Australia for only a modest investment more and a few years more than a technically inferior FTTN/HFC hybrid network. And now NBN Co’s Fixed Wireless and Satellite Review has broadly shown the same: The project is moving along within broadly acceptable cost and timeframe boundaries.
That’s not the message which most of the media will shortly broadcast about NBN Co’s satellite and wireless operations — most of the media prefers to be hysterical rather than analytical. But it just so happens to be the truth.
Image credit: NBN Co
Some hilarious coverage out there today.
AFR: “NBN regional roll out to cost extra $1.4bn”
http://www.afr.com/p/technology/nbn_regional_roll_out_to_cost_extra_t7E7lrvoKIEoTt9H7v79rL
But then further down in the article:
“… the company has maintained that the increase in funding was already included in the $41 billion capital expenditure budget forecast in a December strategic review and is not seeking additional taxpayer funds as initially reported.”
So, in short … the rollout is not going to “cost” an extra $1.4 billion after all?
Am I just a stickler for the facts?
You just don’t try for the shocker headline to get people suckered in.
$1.4b more than the corp plan.
20% rural users with service level 0 is clearly no big deal, actually somewhat of an improvement. NBNCo’s satellites unable to meet expect demand isn’t an issue either, nor the hundreds of thousand of premises without service.
Lack of spectrum not an issue as it is privately held today by competitions.
Yep, a the report non-issue. Labor’s policy going smoothly. Turnbull’s a clown.
Richard is that you…? Surely not?
Regarless, since the election I have missed the political apologists/shills who had no interest in discussing the actual issues rationally and simply were compelled to support their twisted, one-eyed cause, at all costs..
However…
“Yep, a the report non-issue. Labor’s policy going smoothly. Turnbull’s a clown.”
You disagree with the report?
What I don’t get is that TUSMA is on an as-required funding already anyway. If it’s such a problem, can the idea of FTTN in those areas, pay more into TUSMA and subsidise ADSL2+ DSLAMs – what is the point of VDSL2 when the typical usage scenario here is very sparse population density and long distances from the exchange?
And regarding the spectrum, didn’t Communications hold a digital dividend auction early last year where what sold, sold at reserve prices and a third of the spectrum didn’t even sell – 2 times 15 MHz @ 700 MHz? Lemme get this right, Labor left a perfect chunk of spectrum in the hands of Communications to use to do whatever with, and now the coalition is complaining that NBN Co, owned by Communications, didn’t acquire the spectrum and LABOR INCOMPTEONTE!
Here’s an idea to fix that. You’re in charge, scribble random letters on a piece of paper, call it a receipt and you’re done. If you want, charge NBN Co a reasonable amount of money that you even have the power to set too!
Are they being deliberately obtuse to the benefit of Telstra and, to a lesser extent, Optus and the private satellite companies or is there something I’m not getting here?
OK, ACMA will report to the minister on the 1st of September this year regarding the unsold spectrum at 733-748 MHz and 788-803 MHz. “Australian Communications and Media Authority (Spectrum Allocation – Post-Auction Review) Direction No. 1 of 2013”, commissioned by Albanese, Turnbull’s predecessor.
And Mark Gregory said pretty much the same thing in Business Spectator now: http://www.businessspectator.com.au/article/2014/5/8/technology/letter-bill-morrow-nbn-lot-harder-fix-vodafail
Ultimately the 700 MHZ spectrum is ‘available’, but any moves to ‘gift’ that NBN Co or allocate at a price below that which applied in the recent Digital Dividend auction would be met with considerable resistance from the carrier sector AND seriously heighten questions of competitive neutrality, given NBN CO’s ongoing noises about moving into other markets to shore up their business model. As the old saying goes, you can’t have cake and eat it too.
So only the bush is going to have the demand for better services, resulting in an improved solution, while those of us in urbanised areas are to be stuck with FTTN or HFC because the official NBNCo management line is there is no way to forecast any greater need?
Am I interpreting that correctly?
LOL not exactly. If you’re happy with 25/5 then sure but chances are anything you get will significantly higher speeds than what will be available over fixed wireless or satellite.
Unfortunately, it would seem that 25/5 is more than the current government believe we will ever need…
Amazing that even at 25/5 the take up is going to be 2-3x expectations – in the bush where some people have suggested high speed BB isn’t really needed.
That tells me that the public really want high speed broadband as fast as they can get it. I suspect that is why Muddle has soberly played this one with a straight bat!
+1 as a 25/5 Fixed Wireless user, I’ve been busy getting everyone else around me onto it too. Surely this demonstrates that lack of demand for services will not be a problem for the broader rollout. If even my mum (at a separate premise, mind you, sees value in 25/5 FWNBN, surely we can convince a few other Baby Boomers too?
That’s not really true. Category 8 LTE will bring a 10x boost in capacity, enabling up to 2 gbps over 60 MHz of spectrum. Obviously that’s shared, but it’s far more than even HFC can offer to its hundreds of users on a single node.
“Parliamentary Secretary Paul Fletcher did, and predictably blamed the entire situation on the previous Labor Government.”
How many months can they keep saying “Adults” and “Labor to blame”… Get on with your jobs!
I read the review. Thought, pretty much business as usual, adjustment for higher than expected take up and usage..
Read Turnbull’s release. Only a couple of “previous government’ style remarks. OK, maybe he is getting out of opposition mode and getting on with the job, at last.
Read Renai’s description of the press conference and the AFR… oh ffs, grow up guys….
Can I say it again?
I can
Love your work
+1… the coverage of the last several days has been pretty damn comprehensive!
My concern with this whole thing is the potential possibility that NBNco are listing a ‘shortfall’ due to the fact that they are going to ever so slightly grow the fixed wireless footprint in order to offset having to roll out fringe fixed-line services.
That being said – if this is a legitimate report where they want to seriously consider filling true regional and rural gaps with more towers and a potential 3rd satellite, it’s the first piece of positive news I have heard out of NBNco for a long time.
Seems pretty damning of the way the whole 7% solution has been handled…
It is just more evidence of how poorly labor handled the entire NBN..
Also damning is how this information is only coming out now..
…you cannot really be serious, can you?
The LNP continuously claimed in opposition that the ALP NBN was a gold-plated, over-engineered, unneeded and unnecessary network. Now we are all seeing that demand for services on it is so great that they have to grow the ALP solution.
If anything, this just shows how stupid and short-sighted the LNP comments were in the past – AND now short-sighted they continue to be regarding the fixed-line network for the rest of the nation.
+1
When the carbon trading scheme was being spoken about, Abbott was saying that if you had to put a price on carbon, why not just have a tax….. then he immediately turns around and says that the country shouldn’t be taxed for carbon….
https://www.youtube.com/watch?v=xJoyQ6kCL1Q
Rather than risk facing the consequences of massive cost blow-outs & delays in having to run extra fibre or remediation should his nodes fail to deliver over all those long runs of failing Urban Fringe copper we’ll just revise the roll out maps & add a few more thousand towers.
All Fixed, Both Faster & Cheaper but it’s still Labor’s Fault!
I do not understand how the the takeup rate could double or triple. As Mentioned in the article NBN was tasked with delivering services to 100% of Australian premises.
I understand that there were minor issues with the GNAF data that resulted in there being an small increase in the number of non-fixed premises.
So how does the review think there will be 2-3 times more subscribers? I honestly don’t get how they justify this substantial increase. Where is the data or analysis to back this up?
It is well known that FTTP (GPON) has a much longer ‘reach’ than xDSL, it’s able to provide 1000/400Mbps to subscribers over 15km. FTTP also is not subject to the line of sight (LOS) issues of fixed wireless.
I can’t help but think that the increase in satellite takeup might be in those urban fringes that NBNco had planned to push FTTP out to in their latest network revision prior to the election.
I don’t think I am being unwarrantedly cynical as I believe the network design of the previous NBNco team was far more reliable than the political circus that it has become.
To give Noalition financial supporters more cut backs obviously.
My guess here is that even though the NBN was planned to cover 100% of premises in Australia, in the 4% of NBN Wireless areas they did not factor in 100% take-up by premises within that wireless footprint.
I believe a NBN Wireless tower was to cater for a maximum of 180 connections (3 sectors per tower, 60 connections per sector).
There is an NBN Wireless tower in the planning stages very near to me on the outer fringe of a regional city, and I have calculated that there FAR more than 180 premises within that Wireless tower coverage area.
I have feared since the election that the CBN would just quietly remove the 180 maximum connections per tower, allowing more signups, and therefore introducing greater contention for all users on the tower. So, I am pleased to hear that NBN Co is going to increase the number of Wireless Towers.
This is a big cover-up IMO. It is to disguise the fact that FTTP has a deeper penetration into fringe areas, and those areas can’t be serviced with FTTN. It is these that now make up the Additional 2-3 times extra subscribers for fixed wireless. The boundary of fixed line shrunk and / fixed wireless increase as a result.
The ultra-wide frontage properties were IMO the reason Quigley went from 90% FTTP to 93%. The long copper runs make FTTN a nonsense in these areas but were no trouble for FTTP.
I agree with you Cameron Posted 07/05/2014 at 7:26 pm they can’t justify this substantial increase because if those people had been left out of BB calculations , initially, how were they meant to get a phone service? they would have be stranded without a USO covering them once the copper was switched off.
Now they need extra towers. And hunting for more spectrum to make it work
Oh Dear! what to do with the extra towers once the u-turn comes and they switch away from MTM and back to fibre. Maybe Morrow can flog them off to Vodaphone on the cheap. Cheaper ,fasta sooner.
They are already preparing the masses with “$38B of locked in” fibre contacts, sorry, I meant former contracts.
See, IF $38 Billion of locked in former/fibre contracts is the start… which Irish destination does Malcolm navigate too from here.
8 months in Office and how many reviews to learn we are already committed to $38 Billion. Incredible!
Very interesting and feasible theory, IMO…
The copper was not going to be switched on in the 7% of NBN Wireless and Satellite, so anyone in that 7% who already has a copper phone line could retain it.
Hang about – how can they claim FTTP ARPU is not going to grow at the conservative rates predicted (due to gradual increasing take up of premium rate services resulting from demand for higher performance) because LNP (sorry, ‘strategic review’) modelling ‘shows’ a lack of demand for such high speeds, yet also claim that take up of wireless and satellite services will be as much as 300% or the original estimates? Either Cameron is right and they’re trying to push previous fixed-line areas into wireless service categories or they’re trying to have their cake and eat it too – this prediction bears out NBN Co’s original fixed line estimates supporting high ARPU growth on FTTP, growth that isn’t possible on FTTP or the MTM network due to the inability if the resulting infrastructure to deliver adequate performance for higher RPU services.
What I hope is taken out of this is the state of broadband in the bush. We have been held hostage by Telstra for years and years. We get minimum services at best, and we do find something that works well, we grab on to it with all we can, hence the over subscribed ISS. In some cases, where fixed wireless is being planned, perhaps some of those smaller towns that are less than <1000 maybe able to have a FTTN/FTTP/ADSL within the town limits. A nearby town to me is Snowtown, which is on Highway One, and only has 3G Wireless broadband. The school has a 2Mb link, to the internet and no way to get affordable internet for itsself. This school was still running dialup in 2006.
Where can one find a map of the proposed fixed wireless footprint? I fear I might end up in it because I live in the urban fringe (albeit just 24km from the Brisbane CBD)
NBN Co have never published on their coverage maps where future wireless towers are planned to be. There was never a NBN Wireless 3 year rollout plan as there once was with FTTP.
However, with some searching, you can find out the likely locations for an NBN Wireless tower by going to
http://www.rfnsa.com.au/nsa/index.cgi
and doing an advanced search for your Postcode and Filter by Carrier: NBN Co
This will give you all the tower locations where NBN Co have performed an Environment EME Report.
The other site you can search for NBN and your Postcode is:
http://web.acma.gov.au/pls/radcom/register_search.main_page?pSEARCH_TYPE=Sites
Delay a *planned* satellite launch?
Anyone really understand the implications on that?
Thanks Muz. I will have a poke around and see what I can find.
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