Internode plans for 4G mobile launch


news National broadband provider Internode has revealed it expects to launch 4G mobile broadband services through Optus’ fledgling LTE mobile network, following other Optus mobile resellers in getting access to the next-generation wireless infrastructure.

Internode currently resells 3G Optus mobile broadband services, as does its parent iiNet. The pair offer some of highest quota mobile plans currently available in Australia, with Internode, for example, offering an 18GB plan costing $79.95 monthly, and iiNet offering a plan with 10GB of on-peak and 10GB of off-peak data for $59.95 a month, or $54.95 a month when bundled with other services.

At a significant launch event last week in Sydney, Optus revealed it had more than 500 mobile towers enabled for 4G services, and had started selling commercial 4G services to business customers in Sydney and Perth, following successful trials of the new network in Newcastle over the past few months involving around a thousand customers.

In a post on Whirlpool this week, Internode founder Simon Hackett said the company was “expecting to offer 4G/LTE services via Internode”, but such services wouldn’t “necessarily” be available concurrently with Optus’ own retail launch of 4G services. “Some more work is likely to be needed on the wholesale interface side to enable it,” he wrote.

The news comes as other Optus resellers have also reportedly confirmed they will shortly be launching 4G mobile services on the SingTel subsidiary’s new platform. Computerworld reported last week that Virgin Mobile, Amaysim and Boost Mobile were also planning to launch 4G mobile services on the back of the Optus network. Any launch of 4G services by Internode is also likely to be accompanied by a similar launch across the other brands owned by its parent iiNet – Netspace, Westnet, TransACT and so on.

One question will be what end user hardware Internode will launch with its 4G offering. Optus currently has two devices available – a USB dongle and a handheld Wi-Fi 4G router – both produced by Chinese networking vendor Huawei. Internode currently sells two devices to access Optus’ network, one also by Huawei and one by fellow Chinese company ZTE.

Telstra currently offers 4G mobile devices from several major handset manufacturers such as HTC and Samsung for its own 4G network, but Optus has not yet confirmed any 4G handsets for its own network. It plans to reveal its initial 4G handset line-up at a broader consumer 4G launch to be held shortly.

Optus’ rollout revelation marks a faster than expected 4G rollout for Optus. In late May, Telstra — the only other carrier to have deployed 4G services in Australia, with Vodafone not having rolled out its own 4G infrastructure yet — revealed it had switched on its 1000th 4G site. Optus’ own rollout has been less high-profile than Telstra’s, but also now boasts significant 4G coverage in many of Australia’s capital cities. It will hit more than 600 sites by the end of August.

Optus is using the FD-LTE standard for its current 4G network, but is also planning to roll out a concurrent TD-LTE network alongside it. In a live trial demonstration to media last week, the TD-LTE service delivered “peak site throughput capacity of over 200Mbps and a consistent per user range of speeds between 25Mbps and 87Mbps”, according to Optus significantly outperforming the company’s current 4G network in a side by side trial. Optus’ current 4G infrastructure is capable of peak speeds up to 60Mbps, although testing accounts currently vary as to how consistent the experience is. Most tests have shown Telstra’s 4G network capable of speeds up to around 35Mbps.

Reselling 4G services through companies such as iiNet, Internode, Boost, Amaysim and Virgin may allow Optus to rapidly ramp up the number of customers using its infrastructure. However, even with this number of resellers using its infrastructure, it may prove hard for Optus to catch up to Telstra in terms of pure customer numbers, with Telstra already known to have some 200,000 4G connections signed up and analyst firm Morgan Stanley reportedly believing the company will shortly announce it has half a million 4G subscribers already. It is believed that Telstra does not provide wholesale access to its 4G network, although it has started allowing wholesale access to its 3G network.

Launching 4G mobile services may also give companies such as Internode a boost compared with one long-term rival. Ailing mobile telco Vodafone – which has yet to launch any 4G services in Australia and is still upgrading its existing 3G network – is believed to be planning to launch fixed broadband services locally over the National Broadband Network eventually, allowing it to offer a bundle of fixed and mobile telephony and broadband services to customers – as companies such as Telstra, Optus and others already do.

I’d love to see Internode and iiNet launch a series of big fat 4G plans through Optus with huge quotas and a bigger bundling discount for those who use both fixed and mobile broadband services through them. Doing so might finally kickstart the fairly anaemic reseller market for mobile services in Australia. Currently, most Australians buy mobile services directly from one of the big three mobile companies – Telstra, Optus or Vodafone. But there’s still room for innovation in this area, and I’d like to see some of it coming from a company like iiNet/Internode which has been so innovative in the fixed area.


  1. With Vodafone in the situation that it is and Telstra raising its prices and basically forgoing the low-to-mid range market, I wonder if there is space for iiNet to launch its own mobile network? I know it is a hugely capital and labour intensive task, but could iiNet raise the capital required? They could do a ‘3’ and only cover major metropolitan areas with their network and then sign a roaming agreement with someone like Optus to cover the rest, that should at least limit the initial capital required.

    I know it’s pretty far fetched, but can’t help but think that the opportunity for growth in their existing market is rather limited (there aren’t many more players left out to be bought), which leads me to think that they must have at least thought about it…

    • I suspect we’ll eventually see an iiNet/Vodafone merger. The two would appear to complement each other so well — it would make complete sense.

      • That’s definitely an interesting prospect, but the politics of buying/merging with an entity which is owned by two giant international telcos is daunting. Not impossible, but challenging.

        Having said that, if Vodafone/Hutchison get tired of sinking money into their Australian JV and not getting much in return, that might indeed be their best exit strategy.

          • I’m afraid I don’t see that on the cards at all. When you look at all sorts of problems that the Vodafone group is in internationally, and that they are exiting many peripheral markets to concentrate on their core European markets, there would be zero appetite to invest a huge chunk of money into a loss making non-European joint venture.

          • In general, I agree with you, but according to my e*Trade account, iiNet’s only worth some $541 million. Vodafone invests that amount of money in its 3G network every couple of years — it’s not a huge sum of money for the company. So it’s definitely plausible.

          • You are right, and I agree that VHA is probably too big for iiNet, though it is not unheard of for a smaller company to raise enough capital to buy a larger one.

            And of course you would know well the difference between investment in a company and its market cap. If VHA was judged as an independent entity, who knows what its market cap would be. Markets generally don’t look favourably upon loss making companies and VHA might not be worth that much more than its liquid assets.

          • Hutchison are still sinking plenty of money into VHA. If anything, I personally see Vodafone Group withdrawing from Australia eventually, selling their share of VHA, and somebody else buying into that share, whether it be iiNet, or Hutchison Whampoa buying out the other half of VHA, effectively making it 3. :p

          • Aryan, 2 words that validate your thinking a little bit differently – reverse takeover.

            The TPG takeover by Soul shows exactly what can happen in that regard. The Soul brand is all but gone yet the resultant company is stronger due to the collection of parts.

            A similar situation could be identified by Vodafone as a preferrable means of regaining market relevance given the position they now find themselves in.

            That said I suspect such a marriage would not be well received by the ACCC even though it would likely improve competition – the ACCC seems to be completely unqualified to deal with any aspect of the Australian IP business.

      • I would say there is no way iinet and vodaphone would merge (for one it wouldnt be a ‘merge’ it would be a relatively small acquisition for vodaphone). IInet have a history of buying customers, not investing in networks (they do have dslams but nothing on the scale of tpg(PIPE) telstra and optus (HFC, mobile network). I see iinet as basically a managed fund of small isp’s, with the cost savings that arise from a central marketing and support team.

        On vodaphones side i cant see them entering the isp market by buying iinet, they are different companies (vodaphone is budget, iinet is at least pricing wise premium). With the NBN rollout they plan to be an RSP anyway, and if they did want to buy a company i think TPG would make more sense (same budget philosophy, the acquisition of large amounts of network infrastructure would make a difference in the cost of reselling NBN access).

      • Actually Jason from getting mindless slow downs and constant disconnections and tech support that has no idea from TPG and changing to internode with better speeds, no more disconnections and a tech support that actually has a clue and its located in our own country.

        I can tell you now Internode is far from “crap”.

  2. I can see some more competition coming out of this- however, I can ALSO see some MAJOR contention issues raising their heads if all these resellers jump onto Optus and start migrating customers by preference to 4G.

    4G is not a saviour technology- it is an evolutionary, not revolutionary technology. Telstra’s NextG network is and always has been largely the best in terms of performance. Why? Adequate capital investment on backhaul and number of cells (they’ve nearly TWICE as many as Optus) AND NO RESELLERS.

    If Optus manage it correctly, they could use the resellers to capture a large portion of the market back from Telstra. But IMO, I’m not sure if they’ve learnt their lessons about the issues that nearly plagued them as much as Vodafone.

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