Australian government explores mobile tower funding options

Parliamentary Secretary to the Minister for Communications Paul Fletcher has called for industry feedback on a number of proposed funding models for how the government should invest AU$100 million to improve mobile coverage in Australia.

As part of the Coalition's election campaign, the party pledged AU$80 million for a mobile network expansion program to improve mobile coverage along transport routes, regional cities, and places prone to natural disasters, with another AU$20 million dedicated to a mobile black spot program looking at places with high seasonal demand.

Yesterday, Fletcher released a discussion paper looking at the options for how best to invest that funding. There were three proposals for funding the network expansion program: A single telecommunications company being picked to roll out the entire program; telcos bidding for proposed new base stations; or a vendor building the entire network, and either allowing mobile companies to build their own equipment on the base stations or roam onto the vendor's network.

For the AU$20 million for black spots, the government is first determining a list of locations that have poor or no mobile coverage. Once the towers being built as part of the AU$80 billion program are announced, the government will call for local communities to tell the government the location of where they would like towers to be built.

The government will then seek expressions of interest from the telecommunications industry to build out towers in those specific locations.

Under the proposal, all base stations must be open access for all telcos, have sufficient capacity in backhaul, and be available at a price that reflects the government investment in the program, according to the discussion paper.

The government has also asked for feedback on whether opening up NBN Co's towers constructed for the fixed-wireless network would also benefit mobile telcos. It said that although NBN Co had entered into agreements with a number of the telcos to share tower space, it had not previously been asked to consider how it could improve mobile coverage for the telcos.

This is likely to be a major focus for incoming NBN Co CEO Bill Morrow, who told journalists last week that he plans on taking his proposal for NBN Co to improve mobile tower backhaul to the company once he finishes up with Vodafone Australia early next year.

Fletcher said in a statement that the government is keen to hear feedback, not just from the telcos, but also from the communities that would be affected by the improvement of mobile services.

"The government is keen to hear from mobile phone carriers and other industry participants, and from other levels of government — but also from residents and community leaders in outer metropolitan, regional, and remote communities around Australia," he said.

"We want to drive this money as far as we possibly can, which means maximising competitive tension between bidders. We also want to make sure this program not only boosts mobile coverage, but also stimulates competition in regional and remote mobile communications."

The government is accepting submissions on the discussion paper until February 28, 2014.