Spectrum fail could help Libs fight Labor's regional NBN

Spectrum fail could help Libs fight Labor's regional NBN

Summary: Stephen Conroy is using FttP to court regional centres, with the promise of things to come under Labor. Can he convince the bush that FttN won't help them — or can Turnbull save face with unsold 700MHz spectrum?

SHARE:
38

If it wasn't already clear that Australia's regional towns and cities were going to be an election battleground, Labor has been busy spruiking its National Broadband Network (NBN) credentials to make it that way; after all, nothing buys votes better than improved services. But with mobile spectrum auction results falling far short of the government's expectations, and the spectre of contractor shortfalls feeding voter scepticism, is it a battle that Labor can win?

Such questions wouldn't have been far from Stephen Conroy's mind as he continues what is likely to be an intensifying flurry of NBN switch-ons around the country. In recent weeks, he's been travelling to spruik the commencement of construction or switch-on of services in Blacktown, Gosford, Newcastle, Perth, Adelaide, Darwin, and elsewhere. These are all locations well beyond the boundaries of the usual Brisbane, Sydney, and Melbourne CBDs, where market density is such that even private operators like FirstPath — revealed today by CommsDay to be building its own VDSL network in those CBDs — can envision a suitable ROI.

Labor's publicity campaign around such launches is a full-court press to convince regional Australians that it will bring them fibre services — as long as they vote Labor. That's tantamount to heresy in many regional areas, and Conroy will have an uphill battle over the next few months to spread the message far and wide.

In regional areas, the cost will increase significantly. This puts Turnbull in a difficult position, whereby rural customers of the Coalition's user-pays fibre services will face significantly higher costs. That could swing many of them toward Labor, come September.

In regional areas — where properties are often located farther out of town, and fibre-run lengths are therefore many times longer than in the cities — on-demand fibre-to-the-premises (FttP) costs will increase significantly. This puts Turnbull in a difficult position, whereby rural customers of the Coalition's user-pays fibre services will face significantly higher costs than in urban areas. That could swing many of them toward Labor, come September. It may make many of them prefer Labor's election vision.

The latest-released areas, which are now being promised FttP NBN services by mid-2016, read like a verse from I've Been Everywhere, though Conroy will no doubt pass out from exhaustion before he can push that orange button in Bolwarra, Bomaderry, Bombala, Bombira, Bombo, Bomen, Bonnyrigg, Boorooma, Calala, Campbelltown ... you get the idea.

Efforts to fast track the NBN in a broad spread of regional areas will not only be designed to strengthen voters' Labor proclivities, but also to boost subscriber numbers toward the targets that Labor so desperately needs NBN Co to hit before the election. The design of the network necessarily means that properties will come online several thousand at a time as each fibre serving access module (FSAM) is powered up, so each switch-on represents one more halting step toward those ever-elusive targets.

Conroy is no doubt optimistic that word will spread far and wide — boosting subscriber numbers and convincing generally Coalition-friendly country folk that a Labor vote is a ticket to broadband heaven. "Kiama is not a noted geek town," Conroy said during the Blacktown launch, arguing that the 60 percent NBN take-up rate in that town reflects "what we're starting to see come through in the real evidence from real users".

In the other corner is Malcolm Turnbull, who risks losing the support of dyed-in-the-wool Nationals that may see Labor's FttP rollout as the best thing to hit the bush since the stump-jump plough. Turnbull must show those voters that the Coalition's alternative won't leave them hanging, and will deliver services faster and better; however, there are two standout problems for him to overcome before he can do so.

Turnbull needs a way to reliably deliver solid NBN services to properties far from regional centres. If he isn't eyeing that extra 700MHz spectrum as a way of solving this problem once and for all, he's not half the master planner he wants us to believe.

The first is that Turnbull's alternative NBN policy depends on unfettered access to the existing copper network, an unchallenged monopoly that's held to be poorly maintained in regional areas. I have already addressed the challenges that the Coalition faces in getting free access to this network — unless, of course, they've already made a handshake deal with Telstra.

The second is that technical limitations of the FttN VDSL technology mean it is unlikely to deliver the kinds of speeds that Turnbull wants, when applied to the longer runs and poorer quality of the Telstra copper in regional areas.

Turnbull's regional fight will also suffer because of the market realities of fibre delivery: In making his argument that the Coalition will still offer FttP to those who are willing to pay for it, Turnbull has been skewered by Conroy over the approximately AU$5,000 per property the Coalition would charge for an FttP installation.

Turnbull keeps arguing (fictitiously, it should be noted) that the cost is more like AU$2,250, but we all know this is a figment of his imagination, even in metropolitan areas. The real cost is likely to be many times that in regional areas — where properties are often located farther out of town, and fibre-run lengths are therefore many times longer than in the cities. This puts Turnbull in a difficult position, whereby rural customers of the Coalition's user-pays fibre services will face significantly higher costs than in urban areas.

Turnbull's wireless lifeline

And, yet, this is not a showstopper for one simple reason. That reason, as both Conroy and Turnbull will be painfully aware, is that the recent 4G spectrum auction fell well below expectations, leaving a not-insignificant swathe of prime spectrum lying fallow.

Conroy has said that the government will return it to market in a few years, but perhaps the Coalition will find a better use for it.

By assuming control of the unsold 700MHz spectrum — and using it to force faster broadband outcomes with longer-distance services — the Coalition could break Telstra's stranglehold on regional broadband, while delivering pervasive broadband that meets the Coalition's service objectives.

You do the maths: Turnbull needs a way to reliably deliver solid NBN services to properties too far from regional centres to be serviced reliably via fibre to the node (FttN), or cost effectively by FttP. If he isn't eyeing that extra 700MHz spectrum as a way of solving this problem once and for all, then he's not half the master planner he wants us to believe he is.

Since the private sector has already shown that it's not interested in more spectrum — a substandard result linked to Vodafone's decision not to bid — a new Coalition government will have latitude to plan what to do with what Conroy has repeatedly described as the radiofrequency spectrum's waterfront property.

Given that the Coalition's policy depends on utilising rural and regional FttN infrastructure that is: (a) potentially in disrepair; and (b) owned by Telstra — why, then, would Turnbull not move to enshrine government control of the remaining 700MHz spectrum, then either grant a perpetual licence to NBN Co or set up an independent fixed-wireless operator that uses the 700MHz band's superior signal propagation to blanket regional areas with the 25Mbps or better coverage that Turnbull has promised?

Doing so would reduce the Coalition's dependency on access to Telstra's copper access network (CAN) — access to which, as I and many others have repeatedly pointed out, is going to be far more difficult than Turnbull seems to appreciate.

Sure, current network plans include a fixed-wireless component for rural and regional areas — but this is planned for a higher frequency with inferior propagation capabilities, which would require a higher concentration of base stations and a more extensive fibre-backhaul network. By using the unsold 700MHz spectrum to force faster broadband outcomes with longer-distance services, the Coalition could break Telstra's stranglehold on regional broadband, while delivering pervasive bandwidth that meets the Coalition's service objectives.

Sure, it would have an opportunity cost in terms of the AU$1 billion in sacrificed forward auction revenues — but since that money is going to be spent on FttN anyway, perhaps it would make economic sense going forward. It could limit potential future expansion of Telstra, Optus, and TPG — but those carriers are already executing plan B strategies in other frequency bands. Nationalising the remaining 4G spectrum might be a trade-off that Turnbull would be willing to make, if only to minimise his exposure to Telstra's negotiating hardball.

What do you think? Can regional FttP help Labor win the bush? Would it be worth sacrificing unsold 700MHz spectrum to deliver long-distance fixed broadband to regional centres, more quickly and with fewer base stations? Or should the government retain that spectrum for future 4G expansion, and focus on the fixed-line solution wherever possible?

Topics: NBN, Government AU, Mobility

About

Australia’s first-world economy relies on first-rate IT and telecommunications innovation. David Braue, an award-winning IT journalist and former Macworld editor, covers its challenges, successes and lessons learned as it uses ICT to assert its leadership in the developing Asia-Pacific region – and strengthen its reputation on the world stage.

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

38 comments
Log in or register to join the discussion
  • Country people are not straw chewing Hicks

    Most will recognise the value of wireless solutions, but also their limitations. It to be successfull would have to be offered as a MOBILE service rather than a fixed one, going effectively into direct competition with the private sector Mobile Operators thus creating a dichtomy. The NBN is being built as a replacement fixed service, not as a fixed and mobile service.
    Opening a can of worms
    Abel Adamski
  • Bizarre article

    "Turnbull has been skewered by Conroy over the approximately AU$5,000 per property the Coalition would charge for an FttP installation.

    Turnbull keeps arguing (fictitiously, it should be noted) that the cost is more like AU$2,250..."

    Conroy=fact, Turnbull=fictitious; despite the later quoting real-world cost in the UK.

    "Since the private sector has already shown that it's not interested in more spectrum..."

    No they showed no interest at the price Conroy (I can make them wear red undies on their head) demanded. Funniest spectrum auction ever held.

    "Doing so would reduce the Coalition's dependency on access to Telstra's copper access network (CAN) — access to which, as I and many others have repeatedly pointed out, is going to be far more difficult than Turnbull seems to appreciate."

    Why?

    "fixed-wireless" vs "mobile broadband"

    Very different technologies, designed for different applications.

    Why would you waste valuable spectrum by handing it to NBNCo? Far better would be to make it available to the competitive telcos at a much lower price.

    Back in the real world:

    "NBN Co’s internal networks were penetrated by “trojans” created by cyber criminals with “advanced capabilities” that avoided detection by its anti-virus software at least twice in 2012."
    http://www.afr.com/p/australia2-0/kS0NM3AyoxZPxttIJUhicL

    With so little done I guess they gave up looking for anything of value.

    "The executive in charge of NBN Co’s $1.4 billion fixed wireless rollout to regional areas has quit the company, in the latest high-level departure from the government-owned monopoly.
    ...
    It is understood at least five ­members of NBN Co’s 52-person ­communications team have left in recent weeks and as many as five ­senior executives have left in the past year. including head of industry engagement Jim Hassell and head of construction Dan Flemming."
    http://www.afr.com/p/technology/nbn_co_wireless_project_manager_S3T3sja4cmkAlbwJxIzuaM

    52-person ­communications team? Seriously? Something about rats and ships.

    "Singtel Optus has called for the competition regulator to investigate the cost of NBN Co’s satellite program, as part of a push for greater scrutiny over the government-owned monopoly’s spending."
    http://www.afr.com/p/technology/optus_calls_for_review_of_nbn_satellite_N2dCSHfrYMTGALiHiYqTSJ

    Bizarre decision to launch their own capacity given available bandwidth.

    The comedy continues. Sorry we we talking about the ridiculous suggestion of giving the 700MHz to these clowns. Continue...
    Richard Flude
    • Spolied it as usual...

      "fixed-wireless" vs "mobile broadband" ... Very different technologies, designed for different applications.

      Agreed again, but then you just had to go off on your typical electioneering *sigh*

      BTW, speaking of the UK I read that there were 85 000 nodes required. Gee Australia being somewhat (ahem) larger do you believe MT = fact relating to his 50 000 node claim?
      RS-ef540
      • Really?

        Electioneering = quoting news of NBNCo's failure (positive Fairfax's AFR not dismissed as biased).

        UK required 85k nodes because of its population, not because of it's land mass.

        I don't know of the accuracy of the 50k nodes. No knowledgeable person is suggesting that a FTTN network doesn't cost significantly less than FTTP. I'm surprised the children continue to do so.
        Richard Flude
        • Knowledgable people..

          Factor all costs not half... and don't dismiss the other half. But comparing FttH directly to FttN yes, FttN should be cost less especially with an agreeable incumbent/copper owner.

          Of course that's not factoring that the copper was admitted by it's owner as needing replacement 10 years ago/maintenance, greenfields, etc...

          This FttN should especially be cheaper (even at a staggering $30B) considering the smaller foot print and the fact the NBN will have areas already covered for it.

          But laughably you compare and accept only the parts of the UK experience that suit you... and play the population card, again only where it suits...LOL.

          However... I can agree to a point that the population is a factor for needing more nodes, but of course with the UK being so dense (much like you Richard ;) this would decrease the amount required, bit of a one step forward scenario. Lets not forget the UK is about the size of Vic, but granted, with around 3 x the population.

          Anyway... I bet you are starting to have trouble sleeping... getting all excited about 14 Sept and your ensuing victory...LOL!
          RS-ef540
          • Clarification for the pedantically desperate...

            Smaller foot print than the current superior NBN... not the UK... Dick... :)
            RS-ef540
          • It's cheaper because it avoids the high cost last mile

            FTTN has always cost less; period.

            The cost of copper maintenance is a fraction of it's revenue; the network continues to work well for a network that needed replacement 10 years ago;-)

            FTTN isn't proposed for Greenfields. Surprising you raised it.

            The area of land of Oz/UK is irrelevant; you raising it embarrassing. Average household size in the UK is 2.3 people (2011) compared with 2.4 in Oz (2006). Population matters.

            I'll be very excited to see the back of this woeful, inept govt (their Orwellian 10 year plan tonight will be a laugh given their 4 years plans disastrously inaccurate). However a coalition win won't be a victory for libertarians like me; an Abbott govt will not be small govt. Our work continues.
            Richard Flude
          • "However a coalition win won't be a victory for libertarians like me; an Abbott govt will not be small govt. Our work continues."

            lol the clowns aren't even in yet and they are already on the nose. Poor Fluddy.
            Hubert Cumberdale
          • Um...

            Just gotta jump in on copper comment... YOU ARE AN IDIOT... Copper is getting cost up coz we are actually running out... Copper erodes... The houses copper I've seen... The owners needed to pay half the cost per person ($10000) to get new copper in place coz Telstra didn't wanna pay $20000 plus vast other fees costing for a street of 15 houses... So much damage has been done and nobody has the quality they had when it was installed. Hell my own house is experiencing defects of degraded copper. Copper was never meant to be used for internet.. Just phone, even then most techs would rather see something better... Copper is a pain in the ass. The nodes will bring more speed, but 5Mbps more than if you live 2 doors down from exchange. So it ain't much. Also the nodes will bring electricity prices up... Nodes are the worst thing ever... In Canberra, some suburbs have node to house fibre from transact. My mate has $50 more to cover power cost. So this has got to be the worst idea ever. Fttp will cost, but will pay for itself in the later stage.
            ChrisPytank
          • And yet another arrives

            We're running out of copper? Classic!

            True copper degrades, as does everything.

            What houses? Cost to connect a phone line is regulated.

            Copper (presumably you mean twisted copper pair) handles the majority of Internet today. here are well understood technical limitations to copper. Copper is use in Cat5 as well, much more than just phone. And in coax. Amazing;-)

            Copper has significant maintenance benefits, that actual techs would acknowledge, and why it is used for the majority of structured cabling.

            Node electrical consumption is negligible compared to total demand. $50 more per household is ridiculous ACT retail price for electricity is approx $0.18 kwHr (even with their ridiculous green levies).

            Sadly, despite your obvious tech knowledge;-), I don't accept your assurances that FTTP will pay for itself "in the later stage".

            Another to join the RS/Humperdinck team.
            Richard Flude
          • "Copper (presumably you mean twisted copper pair) handles the majority of Internet today."

            False. You are simply conflating issues here.



            "Copper has significant maintenance benefits, that actual techs would acknowledge, and why it is used for the majority of structured cabling."

            It is used because over those shorter distances speeds necessary can be achieved. The next obvious step for connecting premises is fibre since copper cannot achieve the same speeds as you would over longer distances. Also since we are talking about a FttN scenario they cannot be compared at all. Copper in your substandard FttN scenario is also exposed to the elements more so than inside premises. So much for your "tech knowledge".



            "I don't accept your assurances that FTTP will pay for itself "in the later stage"."

            Because Fluddy has a magical crystal ball and in it he saw the future, a future where everyone simply stopped using the internet;-) I mean;-) One more time;-) Still not working:-(
            Hubert Cumberdale
          • DICK...

            Instead of being, as your name suggests... before trumpeting FttN (and then saying you don't support the Coalition and their err FttN plan - that you could have written... *sigh*) why not comment in relation to this...

            http://www.theage.com.au/articles/2003/11/14/1068674351979.html

            Remember too Dick, it's from 2003 (when you were a sprightly 55), from the incumbent at a Senate inquiry...

            Do you the CIO (LOL - I alway laugh at a CIO who refuses to accept the I) really believe connecting to copper which admitted to by it's owner, was pretty well shot 10 years ago..... efficient Dick, you complete GOOSE...!
            RS-ef540
          • It is decending into a farce

            Humperdinck backbones may be fibre, the majority of Internet worldwide is delivered over twisted pair (copper); the issue being discussed. Try and keep up. Speed is not the only consideration for neither home or business; cost much more significant.

            I used my "crystal ball" years ago to predict the failings of NBNCo; I was right. I'm happily to put my knowledge and experience against yours or your fellow clowns.

            RS retorts with evidence of bigpond email issues 10 years ago, which talks of an imaginary replacing of the Telstra's copper network. Well RS it wasn't replaced, a budget never prepared nor any work undertaken. You're a fool for believing it.

            RS's ignorance continues to blind; lack of comprehension leading to a clouding of judgement. NBNCo has failed; the coalition alternative workable. Neither are my prefered position; but one clearly better than the other.
            Richard Flude
          • Err

            The copper wasn't replaced Dick, well done - you finally have something right... remove said dunces cap and take one step away from the dunce corner... congrats.

            However, had you had the capacity to both read and comprehend (like walk/chew gum) you would have noticed it "should have been replaced, years ago, because it's owners admitted it was 5 mins to midnight in 2003..."

            Which part of this are you too stupid to comprehend Dick...?

            Oh the bit where your political masters are idiotically going to connect to the same should have been replaced 10 years ago/5 mins to midnight... obsolete copper!

            Oh please, I guffaw at both your undeserved narcissistic pompousness and idiocy Dick... you are indeed a bigoted Goose beyond compare - give us a honk... Dick.
            RS-ef540
          • People say many things

            Like NBNCo 1.3m premises by June!

            Tips for the children; don't believe everything you hear. Talk is cheap.

            Surprise copper network is not obsolete, no budget made to remove it. It was spin RS; it meant nothing. You were fooled.
            Richard Flude
          • LOL...

            DICK back in the corner put the hat back on...

            It was a Senate inquiry, it was from the copper owner Telstra, it was from 2003 and they admitted the copper needed replacing.

            But you'd know better... ROFL. Give us a honk, goose
            RS-ef540
          • RS it meant nothing

            Don't you get it, yes it was said; it means nothing.

            They never planned replacing it. It was spin. Happens all the time; actions speak larger than words (there's dozens of cliches covering the topic) and there was no action, not even a budget to do anything.

            I know better because nothing happened, we're not reading the article back in 2003. History supports my interpretation; no crystal ball required.

            I feel sorry for you clowns; confidence from ignorance is one thing, but this is getting sad. The article was written 10 years ago and you read it as if it was written today.
            Richard Flude
          • OMG...

            You are thick and also selective Dick....

            There are two parts to this...

            1. I actually agree with you, Telstra never intended on replacing it. Proof being they...

            A. Stopped negotiating with the ACCC first time, at the 11th hour.
            B. Submitted a non-compliant RFP bid second time.

            So again I agree Telstra never planned to replace their copper.

            2. None of this alters the fact that the copper is nonetheless old, degraded and needs replacing (much like you Dick ;)...even though they didn't replace it.

            ROFL though... you the Libertarian just admitted your precious private enterprise "didn't come to the rescue, had no intention of coming to the rescue and indeed... even lied, to a Senate inquiry, by suggesting they would come to the rescue"...

            So we now need the government (either Labor or the Coalition) to take up the slack.

            Glad you finally catching on.
            RS-ef540
          • Why's does it need replacing

            Your only supporting evidence you now dismiss.

            Labor's NBN has set us back 6 years! Yet RS still points to govt. Farcical.
            Richard Flude
          • "Humperdinck backbones may be fibre, the majority of Internet worldwide is delivered over twisted pair (copper); the issue being discussed."

            Exactly dummy. In other words you are and were conflating issues. We are in fact talking about copper but more specifically the copper connecting premises not what is used within them. So yes try to keep up and more importantly stay on topic.



            "cost much more significant."

            Right so when we have a plan that is user pays like the NBN why do you have a problem with it? Not News LTD approved?





            "I'm happily to put my knowledge and experience against yours or your fellow clowns. "

            You are an expert at being a clown? Awesome. But tbh I don't really care how you put on the make-up...



            "RS's ignorance continues to blind"

            I'd say your own ignorance is of more concern...



            "but one clearly better than the other."

            For once you got something right. Too bad you are unable to recognise which one is in fact better.
            Hubert Cumberdale