Demand exceeds funding for mobile blackspots program

Local councils, state governments, and Australia's mobile telecommunications companies will battle it out until April next year to secure funding for the 250 mobile towers to be funded by the federal government, with over 6,000 blackspot locations reported across the country.

As part of the Coalition's 2013 election platform, AU$100 million in funding was committed to fund a regional blackspots program to build around 250 towers across Australia and improve mobile coverage.

Speaking at the Australian Communications Consumer Action Network (ACCAN) national conference in Sydney today, the Department of Communications' manager of regional communications policy Philip Smurthwaite said that there have been 10,000 requests for coverage improvements at around 6,000 locations since the government began taking requests.

The government had scoped a number of funding models, including a winner-takes-all approach, or one where construction companies build the towers for the carriers to then use, but Smurthwaite said the government has decided to adopt a "merit-based" approach that will see the telcos access the request database and decide on which locations suits them best for the funding, and then bid on those locations provided at least one other carrier is willing to collocate on the site.

"What we've agreed ... is that when we know where all the base stations are that we are proposing to support financially, it is going to be a minimum requirement that the other carriers are allowed to collocate on that site," he said.

Getting more carriers on board before design of the base station has started will make it much more cost effective, he said, indicating that carriers wanting to access base stations after they are built can lead to retrofit costs for the towers that can sometimes exceed the cost of building a new tower.

Smurthwaite said that this would provide more competitive tension in the process, and allow the government to get more out of its investment, but he said that not every blackspot would be able to be covered.

"It's clear that 100 million isn't going to fix every blackspot in this country," he said.

Smurthwaite said it is likely that the 250 towers will cover more than just one blackspot each, stating that within a 5-kilometre radius for each tower, it is likely that they will reach between one and 16 blackspots.

"It's not like saying we're going to fix 5 percent of the problem," he said.

"We could cover 1,000 blackspots."

Additionally, investment from local councils and state governments, such as that proposed by the Victorian government, would go a long way to allow the federal government to expand its coverage.

"I'm quietly confident we are going to exceed our demand targets," Smurthwaite said.

The government is also seeking cooperation from local councils to streamline application processes for tower approvals. Smurthwaite said that while the government will go through the appropriate processes for getting approvals for new towers, he admitted that if the towers proposed face resistance from locals, then that site might miss out.

"We totally accept that this is a risk to the program. We need to respect the planning processes that are in place," he said.

"The option for us is to move to the next site on the list, frankly. That will happen. You can't expect that every one will go through unscathed."

He said the government would also be focusing on new coverage locations, rather than beefing up the coverage of Optus and Vodafone to compete against Telstra.

"We are trying to find the balance, but I want to make it clear we are about finding new coverage," he said.

Vodafone's corporate affairs director Dan Lloyd, however, insisted that the blackspot program could be used to bring mobile competition to regional areas and serve a portion of the public that hasn't had any choice other than Telstra for mobile coverage.

"We can bring competition to probably 20 percent of the Australian population that hasn't had competition to date," he said.

Applications will open in October, and will close in February 2015, before the government announces the winning locations in April 2015.