NBN Co mandates satellite “fair use” policy



news Communications Minister Malcolm Turnbull yesterday announced the National Broadband Network Company had instituted a “fair use” policy and deployed additional capacity to allow its interim satellite service to function more effectively, amid reports users were seeing the broadband service on the platform slow to a crawl.

NBN Co is currently building two major, brand new satellites with the assistance of Space Systems/Loral under a contract worth some $620 million. The company plans to launch the satellites in 2015 to provide high-speed broadband coverage to about three per cent of premises that fall outside the reach of the NBN’s planned fixed-line and fixed-wireless services. The locations include outback areas and Australia’s external territories such as Norfolk Island, Christmas Island, Macquarie Island and the Cocos Islands.

NBN Co’s contract forms part of a total investment of approximately $2 billion required to deliver the NBN Long Term Satellite Service (LTSS). Under the terms of the contract, SS/L will also provide associated telemetry, tracking and command systems for NBN Co’s LTSS. NBN Co also signed a separate contract with Optus in February this year for the company to provide tracking, telemetry and control services to the satellites.

The launch of the satellites is widely anticipated in Australia’s rural communities. Currently, many residents and businesses in those communities are being served by either existing satellite services from other companies, or through NBN Co’s existing satellite services, which it operates through renting capacity on existing Optus satellites. However, the interim NBN satellite service has already reached its capacity cap of 48,000-odd customers, meaning many other rural customers will need to wait until 2015 to get upgraded services.

In addition, that interim satellite service is not just reaching its capacity in terms of the number of users who can connect to the service, but also in terms of the experience each user is able to achieve on the platform.

Speaking in Parliament yesterday, Turnbull said: “Most of the 5,600 interim satellite users in Western Australia now are getting no better—and often worse—than dial-up speeds. Kids cannot do their homework, and farmers cannot access the online national livestock identification system, real-time prices or weather services.”

Turnbull described the situation as a “train wreck” instituted by the previous Labor Government.

“The 45,000 unhappy current customers are costing the tax payers of this nation $7,300 each indirect subsidy,” he said. “That is nearly three times the level of the old Howard era Australian Broadband Guarantee subsidy and for a much worse service.”

“Here are the measures that we are announcing today. First, at a cost of $18.4 million, the NBN Co will upgrade the current capacity to all users on this satellite service by one-third. Second, we will institute a new, stringent fair use policy to ensure a minority of very heavy users cannot crowd out the majority.”

“The NBN Co’s trials of these changes demonstrate that even in busy periods families will be able to answer the emails, surf the web, do their banking and see their kids complete their homework. It will not be as fast as the speeds promised but never delivered by Labor, but it will be broadband and much higher and certainly not anywhere near the anaemic dial-up speeds experienced at present.”

“We are also working on additional measures to provide new services so that at least some of those—about 9,000 in total—who have not been able to get on, will be able to do so, and we will have more to say about that in coming days when the arrangements are complete.”

The news comes as NBN Co is also conducting a review of the future of the satellite and fixed wireless portions of its planned network. Last week, Sydney Morning Herald journalist Malcolm Maiden reported that new NBN Co chief executive Bill Morrow would seek to sell the networks to the private sector as soon as possible. Pure play satellite company NewSat has already made an offer to buy the satellite infrastructure.

I want to note here that the responsibility for this situation rests on both sets of political shoulders in Australia’s chronically incompetent Federal Parliament — both Labor and the Coalition.

Turnbull’s right — Labor mismanaged this satellite solution. NBN Co looks to have over-provisioned the service to start with, leading to the necessity of the fixes which Turnbull has this week instituted. It should have been obvious to those involved in this process from the start that this situation was going to eventuate, if NBN Co had consulted widely enough about the capacity of the services it was leasing from existing satellite companies such as Optus.

However, it’s also true that Labor put in place the interim satellite service as a much-needed emergency measure. Turnbull can rant and rave all he likes about “Conrovian” failures, but in the end the key responsibility for poor satellite services in Australia rests with the previous Howard Government under Helen Coonan. Nobody would have taken up NBN Co’s ISS service if the old Australian Broadband Guarantee subsidy which existed under the Howard administration had been anywhere near functional enough.

This little episode contains the whole NBN debate in a nutshell. Labor tried to do something about the nation’s broadband future, but mismanaged a fundamentally good policy. However, the original issue can still be traced back to previous Coalition Governments, which just didn’t tackle the problem at all.

Turnbull, let it be widely remembered, suggested in Opposition that there was no need for NBN Co to build its own satellites, because existing satellite capacity was more than enough. “There is enough capacity on private satellites already in orbit or scheduled for launch for the NBN to deliver broadband to the 200,000 or so premises in remote Australia without building its own,” Turnbull said in a statement at the time.

Well, the Minister’s Parliamentary Statement this week certainly gave the lie to that ridiculous statement. One wonders whether the Earl of Wentworth will consider admitting that he was wrong.

Image credit: NBN Co


  1. I’m just waiting for this same scenario to happen all over again when the HFC “upgrades” begin and Coalition declares HFC “NBN worthy!”

    And once again people will find out the same problems inherent in HFC (and all shared mediums) it will fill up and it will get congested. Except this time they can’t draw the “It’s Labor’s fault!” card since it was their idea to keep the HFC network

    • They will absolutely say that it is all Labors fault. They could have a majority in both houses for 20 years, and they would still be blaming Labor for anything which went wrong. It’ll probably go something like this : “We did the best we could with the mess we inherited from Labor, and if we had stuck with Labors plan you wouldn’t have got anything at all.”

  2. The fact of the matter is… if it wasn’t for the Labor Government and the establishment of the NBN, none of these customers on the ISS would have had adequate broadband. I think that’s pretty evident in the way the people on the ABG swarmed to get connected to the ISS.

    It really worries me that we have a Communications minister who is so self-absorbed in his own “successes” without actually realising his faults and lack of understanding of the whole situation… and Renai, your example of the private satellites statement illustrates this point perfectly.

  3. If there was any sign that the people who voted for the Coalition valued long term consistency or candour in their representatives, then Turnbull’s choice to forget his former mudflinging over NBN not needing its own satellites would be something worth making more of. […sound of crickets…] Ehem. So let’s leave it at that.

    What is harder to ignore is that the Howard-era Broadband Guarantee 2-way satellite services were retail services, and imposed incredibly low transfer limits. I am pretty sure mine started out (sometime in 2001?) at about 1GB for a MONTH, and by the time I gladly fled in 2007 the limits were up around 3GB/month. It is hardly surprising that oversubscription was less of an issue, when it took much less than a day of flat-out 512Kbit/sec transfers to blow through the monthly download cap. The per-MB charges for going over the monthly limit were also pretty severe, if I recall correctly.

    For Turnbull to compare these “good old days” of satellite subsidies with NBNCo’s current situation, as a wholesale supplier with artificially constrained pricing for wireless and satellite, operating at arm’s length from the actual customer contacts at the ISPs, it’s pretty clear he intends to make NBNCo throttle satellite subscriber bandwidths to fit 2000s-era total monthly usage limits, irrespective of any ISP-imposed throttling when plan limits are reached. There’s little point in a satellite NBN subscriber ordering more than a minimum download plan in that case. Using anything more than what it takes to do homework or check your email is getting ideas well above your station.

    In any case, all those oddly singled out WA satellite users can be happy that the real satellite service is on its way, despite the best efforts of the current minister to pretend that there was no need for it. Soon he can start claiming the satellites were his idea all along, and nobody but us nerds and nitpickers will notice that history changed.

  4. If i sold something for $3,000 , that cost you $10,000. You would probably get a swarm. Sure you sell out your subscriptions. But that is by no means it is a success. In fact its a total failure. You not only over subscribed giving a poor level of service to individuals, you make a huge loss, and you push other service providers out the market who don’t have the luxury of running at a loss.

    Labor satellite roll-out is a huge failure, and there is no way we can recover from it even though they no longer in control of the rol- out. The damage has already been done.

    • “If i sold something for $3,000 , that cost you $10,000. You would probably get a swarm”

      If I didn’t need it, why would I spend $3000 at all?
      Your analogy makes no sense and is baseless…

  5. Talk about every Ukrainian government since the Soviet Union broke up being incompetent and corrupt. The choice we seem to have in Australia is between one of the two major parties that doesn’t do what needs to be done, and the other one that does it but badly mismanages it. One lot throws our money down the toilet on badly done good ideas and puts us way into debt. The other gets into government because we’re in debt and, to get the other lot’s debt down, stops spending on things that need to be spent on.

    • What do you base the “got us into debt” argument against Labor? Seriously, whats it based on? MSM? Your own interpretation? Your own research?

      I ask this because any research of any credibility will show you that it wouldnt have mattered which party was in power, we would still have gone into debt.

      Dont lay the blame on Labor, when it was Treasury overestimating tax revenues by 10%. That makes it very hard to balance ANY budget, and the core reason why we are in debt. Go do some research, and you’ll find that in the Howard years, estimates were way down, and we ended up with a surplus, but almost the day after Rudd gained power, estimates were way too high, thanks to the GFC.

      You cant just shut off spending as you like, and with how much is spent on benefits, all you would end up doing is cutting funding to essential services. There really isnt that much discretionary spending in a federal budget, and it wouldnt make much difference if you tried to cut it.

      • Re-reading that, it came out a little agressively. Wasnt the intent Gordon, I’m genuinely interested in how people come to this conclusion. Part of my job is (or was, but I keep looking anyway) to look at this sort of information, and from experience I can say with confidence that there is very little ANY Government could have done to prevent going into deficit.

        So I personally wonder how people come to the conclusion its one Governments fault or another. Like Howard getting into surplus, and seemingly not able to come up with any ideas to spend the money (which I have accused him of, mostly because he knows the following year that the surplus is there) he’s actually a victim of circumstance that makes it LOOK like he has no ideas.

        Do others look at the economic forecasts, or rely on what the (often biased) MSM and shock jocks report? As I said, it was my job to look at those stats, and I’d be surprised if many outside the accounting industry looked at them, but they tell a very different story to what the MSM would have most people believe.

      • It was also the rapid cutting of spending that lead to “the recession we had to have” which is why it was advised against when the GFC hit, and it worked pretty well.

  6. I am expecting this “Fair use” policy backfire and ends up accidently disconnecting some farmer or someone which requires it for medical reasons then gets disconnected. They’ll complain to the media

      • I afraid most remote farmers don’t have copper lines. And very large number of the others cannot get a stable connection. I have been on several of these these farms (the ones with copper), a very large number of them a only basic and unreliable fax services.

  7. as far as im aware this was a last resort connection. if you couldn’t get anything else, you could get nbn sat. but from reading various places on the web people who didn’t meet the criteria took this option. don’t forget to blame them too

  8. Also note that Turnbull has complained previously that Labor signed the contracts to get the LTSS satellites up and running before getting the orbital allocation. The ITU specifically called out Turnbull and said that it’s fine.

    Basically if Labor had done things the Turnbull way, they’d have done it in a different order, which would have resulted in about a year or two year delay in getting the real long-term solution to this done.

    Yep, that’s right. If Turnbull had managed this thing even if he would have gone with the long-term solution of putting satellites up there instead of buying capacity at pretty inflated prices, if he’d listen to his own advice here, it’d have had about a year or two year delay for absolutely no reason whatsoever to the extent that the ITU agrees, is how incompetent he is. But nice to know he can still open his mouth and bitch about things, which is all he’s good for. Being a lawyer and all. Seriously, if a UN agency can tell you with hardly a moment’s hesitation that you’re either ignorant (or intentionally misleading) and should just STFU, you deserve a special price of being a moron to outclass the vast majority of other morons on this planet.

    And of course, the irony of Labor underestimating demand for broadband here and the coalition criticising them for that. You’d think they’d take a long good hard look in the mirror on that issue, but they seem to be mentally incapable of comprehending that.

    And yes, ad hominem, etc., etc. But they started it, they really did.

    • Actually he wasn’t wrong. Significant satellite capacity exists, just not on the satellites Labor rented capacity from.

      Blaming Howard for NBNCo failure is extraordinary.

  9. I would like to point out that this is a problem that would have happened under LNP anyway. The last 7% had the same solution under both parties, so for Turnbull to label it a train wreck is a defacto admission that his own solution would have been a train wreck of the same proportions.

    4% fixed wireless and 3% satellite didnt change, it was only the mix of FttH (22%) and FttN (71%). So for this 3%, how would Turnbull have acted? The irony for me is that Labor rolling out the satellites originally was exactly what the Liberals have been preaching for 6 years – sooner faster cheaper. Worst effected population got a short term solution at the start, with the intent of improving it as it went along.

    The fact that it was oversubcribed, and there is significant congestion is also telling. It says at least two things to me.

    Firstly, that the rural sector NEEDED improvement. Otherwise, why was it oversubscribed to the point congestion has killed it?

    Secondly, it shows the inherent issue with wireless – congestion – and what will happen if we rely on that tier of technology for our prime connection.

    There are lots of lessons to be learnt here. The first of which is that Turnbull needs to be careful where he steps, as the problems are a result of his own parties shortcomings, and something he would have replicated anyway.

    I’ve pointed out in other unrelated stories that the Howard government shouldnt have been stockpiling a surplus, and here’s a good example why. Why werent they dealing with these issues 10 years ago? A $1b hit in 2004, when we were cutting taxes and still getting a surplus, and its almost a non issue today.

  10. In the end any satellite solution goes no where in fixing the problem…. Voice services do not work over satellite to the same standard to what we are all accustomed to.. Sure copper is staying, but again at great expense to the consumer which has to subsidise that at well via the USO payments..

    There must be a real long term solution found, not these half arsed ideas only designed to get you over the line into the next political term…

    Unfortunately, our politicians only do what society demands of them… There is no national spirit, people in Melbourne are more concerned about their own needs and wants then the needs/wants of someone in Bedourie…. And Vice versa…

    • VOIP uses very little bandwidth, when done right. If it does, someone has gotten lazy somewhere, because there is usually so much bandwidth available.

      A sibling of mine worked on VOIP standards in the 90’s, and to test it they communicated while playing online games. True story, think it was battle.net on the original diablo, but there was a sesh or two with one of the Doom’s. So in a dialup world, where online games demanded pretty much every kb of bandwidth, they were able to communicate with no problems.

      Even with satellite having massive congestion issues, as this story points out, its still should be able to minimise the bandwidth needed for VOIP. It only needs a couple of kb and nothings really changed since then that would make it bigger. Comm’s have traditionally been a low bandwidth area, dating back to the telegraph (morse code), through to phone services taking up such little space that they work fine while our net services drop out.

      VOIP, in one version or another, IS the future. Its just a digitalisation of the analog signal we used in the past, and as mp3’s have shown, the compression ratios are very very good. A wav file of 40 meg will compress down 90% for example and still be perfectly functional.

      • It has nothing to do with bandwidth, but latency.

        I take it you know very little about satellite internet.

        • No, I understand perfectly fine. I take it you know little about VOIP though. VOIP packets are small, not big. That means latency is less of an issue. Resending a packet takes fractions of a second, or can be missed and not make a difference. Compression of the data means the packets are also very small, well under 1k in size.

          And the point was that if VOIP works with 56k dialup (might have even been 28.8k at the time), then its going to work with the 25 Mbps connections we’re being promised, latency or not. Even if congestion drops that to 1 Mbps, latency would need to make the connection 100% unusable for VOIP to fail.

          VOIP will work just fine on satellite services, latency or not. Dont sweat it.

  11. Nice weasel words Malcolm. Even “anaemic dial-up speeds” are better than what they had under previous liberal governments…

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