Optus to operate NBN Co satellites

Australia's second-largest telecommunications company has been picked to operate NBN Co's long term satellite for up to 15 years.

Optus, Australia's second-largest telecommunications company and a significant satellite operator, has been tapped by NBN Co to control NBN Co's two long-term satellites for up to 15 years.

Image: Josh Taylor/ZDNet

The AU$620 million Ka-band satellites are due to be launched next year on the back of two 777-tonne rockets by French company Arianespace . The satellites will provide broadband services to approximately 200,000 premises across the Australian mainland, as well as Norfolk Island, Christmas Island, Macquarie Island, and the Cocos Islands.

Services on offer will be up to 25Mbps download, 5Mbps upload for premises that sit outside of NBN Co's fibre and fixed-wireless footprint.

Optus and NBN Co have announced today that they have signed an initial five-year agreement to operate the satellites once they have been launched. The contract has the potential to be extended out to 2030 — 15 years after the launch.

Optus will check the telemetry, and track and control the NBN Co satellites from its satellite ground station in Northern Sydney .

Optus is already supplying interim satellite services for NBN Co on its existing satellites, and has five satellites in orbit today, with another planned for launch later this year.

The contract was won after a competitive tender process, NBN Co has said, and comes just months after Optus had considered selling its satellite business , but decided to continue growing the business. At the time, Optus would not rule out a future IPO of the satellite division.

"As a leader in the provision of satellite services, Optus looks forward to working with NBN Co to fly these satellites and assist it in meeting the significant demand for high-speed broadband services in regional and remote Australia," Optus' vice president for satellite Paul Sheridan said in a statement.

The deal with Optus does not address the ongoing issue of customers looking to access the interim satellite service before the launch of the new satellites next year. At the end of last year, NBN Co hit its capacity on the interim satellite services, with 48,000 having ordered a service on the interim satellites. The company has ceased taking orders on the satellite service while the government is mulling its options.

As of last week, NBN Co had 44,447 premises on the service. The maximum monthly download is 9GB per month, while on the full satellite service, NBN Co users will be able to download around 60GB per month.

NBN Co had not responded to questions on the value of the deal, but is expected to invest around AU$2 billion in the long-term satellite service. Originally, the plan to launch the satellites instead of utilising existing capacity was deemed to be the "Rolls Royce" approach by then-Shadow Communications Minister Malcolm Turnbull, but, now in government, Turnbull has committed to keep the satellite launch running, and visited Loral at the construction site for the satellites during his recent visit to the United States.