Eighteen months after missing the Turnbull government’s original rollout target, NBN Co has yet again backtracked after CEO Bill Morrow confirmed the company “killed” plans to deliver 100Mbps broadband to largely regional customers over fixed wireless broadband.
Hundreds of thousands of customers would potentially have had access to the fast services, but Morrow told a Senate Estimates committee that doing so would have required the “outrageous” expenditure of “billions and billions” of dollars.
The admission is the latest in a series of efforts by the company to revise targets and wind back complex parts of the network in order to speed its rollout.
Morrow said he is focused on meeting the government’s current statement of expectations (SoE), which were set in 2016 and mandate a 25Mbps minimum peak data speed with 50Mbps delivered to 90 percent of fixed-line premises “as soon as possible”.
The CEO, who recently announced his intention to retire at the end of this year, doesn’t want to “jeopardise” this target “by offering a 100Mbps product to our residential communities”, he explained.
NBN Co has repeatedly confirmed its confidence in completing the network rollout by its target of 2020.
Congestion grew 50% in a month
Just 12% of fixed-line NBN users are currently taking 100/40Mbps services, according to the company’s latest quarterly report.
This is down from 14% a year ago, reflecting a freeze on the number of 100Mbps-capable HFC services after technical problems and surging customer complaints forced the company to stop taking orders for those services last November.
The fastest-growing speed tier on the NBN is the 50/20Mbps plan, which had increased from 4% of services a year ago to 28% at the end of March.
Updated figures suggested this percentage had surged to 42% of homes and businesses by the end of April.
Yet that growth has come at a cost, despite NBN Co’s success in working with retail service providers (RSPs) to improve overall speeds and reduce congestion – from 6 hours 55 minutes per week in April 2017, to 12 minutes in January this year.
That figure increased by 50% to 18 minutes weekly during April – reflecting continuing growth in customer numbers and the surge in 50Mbps plans.
Fixed wireless reality check
Users of the company’s fixed-wireless connections – used predominantly in regional areas, where fixed infrastructure is either inadequate or too expensive – haven’t been so lucky.
Some 75% of services over the NBN’s 226,901 active fixed-wireless connections are being delivered at labelled speeds of 25/5Mbps, according to NBN Co figures.
Yet the actual speeds being delivered over fixed-wireless connections are much lower: monthly NBN Co figures, released in April, suggested that only 46% of the company’s approximately 7000 fixed-wireless cells were delivering average wholesale speeds above 25Mbps.
Around 29% of cells were only delivering between 12Mbps and 25Mbps during peak hours, while 18% were delivering 6Mbps to 12Mbps.
A cell must be operating at below 6Mbps before NBN Co considers it to be congested.
NBN Co has repeatedly rebalanced the mix of technologies used on its network, adjusting the technologies planned for particular areas as financial, technological and overall planning objectives changed.
Early last year, iTnews reported that NBN Co had changed residents in 62 towns from FttN to fixed wireless or satellite services.
The original fibre-to-the-premises (FttP) model, proposed by Labor when it announced the network in April 2009, would have delivered 100Mbps and faster speeds to all Australians.
NBN Co has progressively stepped back from those targets as the technical limitations of existing copper and HFC networks became apparent. However, the latest announcement suggests other issues have arisen because the fixed-wireless network is completely new.
Morrow was also hedging his bets on fibre to the curb (FttC), a 100/40Mbps access technology that has been embraced by NBN Co as an alternative to overburdened HFC networks and did not exist when the FTTP model was proposed.
Ever since the NBN was announced in 2009, Malcolm Turnbull – first in opposition, then as Communications Minister and architect of the current multi-technology model (MTM), then as prime minister – has pushed the argument that Australians don’t need 100Mbps speeds.
The Prime Minister attracted considerable scorn when he proved happy to pay for the premium speeds after they recently became available at his home.