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Risk of competing goals ‘negatively impacting’ NBN quality, affordability: Infrastructure Australia

If the National Broadband Network (NBN) can’t meet all of its stated goals and obligations once the rollout is complete, the ability for Australians to access affordable and high-quality services over the network may be “negatively affected”.

This is according to the Australian Infrastructure Audit 2019, published on 13 August by the nation’s independent infrastructure advisor, Infrastructure Australia, the independent advisory body tasked with strategically auditing the nation’s key infrastructure.

The audit report, which covered areas such as transport, energy and water, delivered a mixed report card for the country’s telecommunication landscape, identifying several challenges relating to Australia’s fixed-line broadband offering, rural and regional availability, pricing and the NBN’s technology mix, among other things.

Unsurprisingly, the report’s telecommunications section focused heavily on the NBN, as one of the country’s largest infrastructure projects. One of the challenges highlighted in the audit report was an “inherent tension between the NBN’s strategic goals”.

It suggested that this tension will ultimately require potential trade-offs between the NBN achieving user outcomes and delivering a return on the capital investment made by taxpayers.

“If all goals cannot be achieved, the ability for Australians to access affordable and high-quality NBN services may be negatively affected,” the report authors said.

Moreover, the report suggested that these tensions raise the question as to whether or not the network will be sold and, if so, how exactly the assets would be divested and therefore how the market will be structured.

“A proposed eventual sale of the NBN to the private sector raises challenges in striking the right balance between realising its value for shareholders and achieving long-term goals for users,” Infrastructure Australia noted. “Decisions about restructuring and sale can affect both short- and long-term service delivery and outcomes for users.”

Another challenge relating to the NBN noted centred on its technology mix having been diversified, meaning that different users will receive different types of connections.

“This change will deliver varied outcomes for users, and some may shoulder higher costs or receive lower-quality services,” the report authors added.

As such, according to Infrastructure Australia, a range of NBN process and performance issues have arisen as the rollout has proceeded and users have migrated to the network, some of which are being dealt with by the company behind the rollout, NBN Co.

In addition, the independent infrastructure advisor flagged the risks that 5G network rollouts in Australia might present to the long-term competitive position of the NBN.

“Looking forward, risks for the NBN include competition from ongoing fixed line services and 5G fixed wireless substitution,” it said. “There is also the possibility of competition in remote locations from emerging low Earth orbit satellite technologies and other satellite technologies.”

However, the report also pointed out a potential silver lining, noting an opportunity for the NBN to leverage these technologies to deliver better services in its existing fixed wireless and satellite coverage areas.

Rural and regional Australians still missing out

Infrastructure Australia’s examination of the services offered to people in rural and regional areas was somewhat tempered by the existing limitations of the various technologies available, even with the NBN rollout underway.

“NBN’s use of fixed wireless and satellite technologies limits the choice of available broadband speeds and download quotas, particularly for remote areas,” it said. “However, these services are often the only option for regional Australian consumers and businesses.

“Although NBN is launching business-grade NBN services, these do not currently extend to [its] fixed wireless and satellite access technologies,” it said, noting NBN Co’s plans to deliver a business-grade satellite service this year.

More generally, however, Infrastructure Australia identified a range of issues with the current telecommunications services available for consumers in rural and regional areas, and for some minorities.

“The specific needs of rural and remote users are often overlooked in upgrades to national telecommunications infrastructure,” the report authors said. “Income, age, disability, education and Aboriginal and Torres Strait Islander status are all factors that influence levels of digital inclusion.”

“Geography also matters,” it said. “In rural and remote settings, the cost of providing telecommunications infrastructure increases and the returns reduce as population densities decline. In some cases, this limits the scope for universal coverage by commercially-focused private sector operators, without government intervention.”

“While Australia’s mobile footprint includes over 99 percent of the population, it covers only one-third of total landmass, meaning there is limited service in particular rural and remote areas, for example along transport corridors,” it added.

However, the audit report also cautiously identified opportunities to improve the telecommunications services for the digitally disadvantaged, and for rural and remote communities and businesses.

“5G mobile technology provides a potential step change in mobile telecommunications infrastructure for Australia, offering huge benefits including faster mobile data, minimal delays and the ability to separate services on the same network. However, the cost of rolling out 5G is high, and without a change in prioritisation, existing issues may be exacerbated in rural and remote areas,” the report authors said.



Categories: Broadband, Fibre, National, NBN, Networks, Satellites, telco

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