NBN Co has “killed” off plans to offer 100Mbps services on its fixed wireless network so it can concentrate on meeting its minimum performance obligations.
The company “suspended” its examination of fixed wireless tiers beyond 100Mbps a month ago while it tries to fix congestion problems in parts of the wireless network.
CEO Bill Morrow said today that NBN Co has now formally scrapped the idea of offering speed tiers beyond 50Mbps on the fixed wireless network.
“We killed [100Mbps],” he said.
“Never say never, but it’s not on the roadmap any longer.”
NBN Co’s fixed wireless network has come under heavy scrutiny this year, as the extent of performance issues have become clear.
Last month, it revealed only 46.08 percent of cells “averaged wholesale access speeds during the busy hour … above 25Mbps”.
About a quarter of all cells see less than 12Mbps in the peak, but NBN Co only considers the cells to be officially congested once user performance dips below 6Mbps.
Morrow said today that the company is worried about raising all users up to meet the minimum service obligations for broadband set out by the government.
“Our SOE [statement of expectations] requires a 25Mbps minimum peak data speed, not 100Mbps, so therefore I don’t want to jeopardise [performance for] any other end users by offering a 100Mbps product to our residential communities,” Morrow said.
Morrow said that the capital cost of raising the fixed wireless network to support 100Mbps speeds would be “outrageous”.
“We have about 240,000 active users on the fixed wireless network today and expect it to go up to 400,000,” Morrow said.
“If you said for all those 400,000 users we want everyone to have 100Mbps speed to all use in the same concurrency levels in the evening, you would be blown away at the cost.
“It would just never happen.”
Morrow suggested it would run into the billions, on a service he noted is already “a loss-leading effort”.
“I don’t want to say $5 billion, $10 billion or $100 billion, but it’s cost prohibitive,” he said.
Morrow disputed that limiting the fixed wireless network to a maximum speed of 50Mbps would create a digital divide with city areas.
He said that regional Australia “had near nothing” when it came to pre-NBN broadband, and that what they had received so far “has changed their lives”.
“The divide has actually closed because this is universal access to 25Mbps,” he said.
“I think we have to acknowledge … [Australia’s] vast land [mass] is going to drive economics that likely mean regional users accessing broadband over this network are likely never to see the kind of bandwidth capability that will come in a city centre.
“You can already see it today: over 40 percent of the fixed line network can already offer gigabit speeds but you don’t see that in the regional areas and I can’t imagine a timeframe where that necessarily will be available to all the people in the regional areas.
“Maybe on a spot by spot basis there’s some fixed wireless towers using 5G that can go up to a gigabit service, but I can’t imagine a technology world where offering them all gigabit services would be feasible.”
Morrow said that his commentary was an “honest” assessment of broadband fortunes for regional Australia.
He also cautioned hysteria around the company’s tier decisions on fixed wireless.
“It’s really important before we get too worked up about that, that [we consider] what services demand [there is for] gigabit per second capability today,” he said. “There’s none.”
He also disputed the real need for 100Mbps-plus services over any access technology, let alone fixed wireless.
“We can look at where we have fibre - we don’t see 20 percent take-up of 100Mbps in fibre,” he said.
“I would not say there is a mass-market demand for 100Mbps services today, but who knows in the future.”
NBN Co had said as recently as January this year that it expected half of its fixed wireless footprint to be able to support 100Mbps speeds by the time the rollout was completed in 2020.
