Turnbull's Small Town Thinking

Malcolm Turnbull has criticised the NBN approach for ignoring the VDSL potential in areas currently slated for wireless coverage. When you look at the current ADSL penetration in these areas you can see, he has a point.

Small town Australian could be missing out under the current NBN rollout plans. As it stands, half a million premises will be hooked-up to the new network via fixed wireless connections, offering speeds up to 25 Mbps. That's better than ADSL2+, but not as good as Malcolm Tunrbull's proposed vectored DSL, which could deliver speeds up to 100 Mbps.

The criterion for wireless (and satellite) connectivity is, to an extent, determined by the size of the locality. Towns with more than 1,000 premises will get fibre to the premises. Less than that, residents will be connected by wireless or satellite, unless they are close to the NBN transit network. That includes some locations with less than 500 premises.

Yet the vast majority of localities with between 300 and 1,000 properties have their own phone exchange and, generally, ADSL2+ coverage. And you don't have to study too many coverage maps to realise the geographic spread of these towns is often constrained, so VDSL coverage could be attained with just a few of the infamous Turnbull cabinets in the streets.

Take Texas in Queensland, as an example. It has DSL2+ coverage for just 300 premises and a population of 640. As the map shows, many of the houses are built around a small number of centrally located streets. You'll find the same situation with most small towns the length and breadth of the country.

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The folks at Walla, 40kms north of Albury-Wodonga, have been protesting about the building of a 55 metre NBN wireless tower in the middle of their town. Walla is home to just 540 people (198 premises) and it too has its own phone exchange with DSL coverage. Surely upgrading to VDSL would prove more cost effective than building a tower (reported to cost $240,000) and having residents install outdoor antennas on their roofs.

Turnbull's argument becomes more pronounced when you consider that the copper has to remain active in these towns anyway. Telstra is getting paid $230 million per year to ensure the maintenance of a standard telephone service across the country, thanks to a 20 years agreement with the Telecommunications Universal Service Management Agency (TUSMA). A standard telephone service requires a fixed line, so in those areas slated for wireless and satellite coverage, copper connectivity will be around for a long time to come.

And it's not a small number of people we are talking about. Upgrading to VDSL could potentially see up to 800,000 Australians receive speeds faster than the proposed wireless solution. Possibly more. The graph below shows that more than 1 million people live in towns with between 100 and 1,000 premises. As the size of the locations reduces (below 100 premises) they become scattered, with many too far from a local exchange to support DSL technology. Even so, there are many towns with less than 100 premises (like Broke in NSW, Tullah in Tasmania, and Guildford in Victoria) that have their own exchanges, with at least ADSL1 deployed.

Image: Phil Dobbie/ZDNet

There would be some losers if wireless coverage was foregone for a VDSL deployment. Outlying properties, like farms, might be reduced from wireless to satellite coverage, with an increase in latency. But folks in town will see a definite improvement. It highlights one of the issues with the NBN. As iiNet CTO John Lindsay puts it, "There's a tendency to take away good service from some people to provide adequate service for all people, and that feels fundamentally wrong."

There's a further complication. Telstra, can continue to offer ADSL services over its copper in these small towns, even when the NBN wireless solution is active. So long as the copper isn't upgraded to deliver speeds faster than 25 Mbps. Introducing a new, faster service requires ministerial permission. That leaves the way open for Telstra to undercut the NBN. Consumers can choose price or speed. I wonder which way they'll go?


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