NBN scraps plans for 100Mbps to homes on fixed wireless component

NBN Co has scrapped plans to offer a 100 megabits per second service to homes on the fixed wireless component of the NBN.

Outgoing National Broadband Network CEO Bill Morrow at a Senate Estimates hearing today. Picture: AAP

NBN Co has scrapped plans to offer a 100 megabits per second service to homes on the fixed wireless component of the National Broadband Network (NBN), with the company’s outgoing boss Bill Morrow saying that the product is no longer on its roadmap.

Speaking to the Senate Estimates on Thursday, Mr Morrow said that delivering such a service over the fixed wireless 4G service would be cost-prohibitive

According to Mr Morrow, the cost of adding more bandwidth to a fixed wireless network is exponential.

“If you stay at a certain level it’s not a problem but the cost of that incremental capacity starts to double, even quadruple.”

“The ideal of offering a 100 mbps services means driving even more capacity into the network and the economics of that break apart to a point where it doesn’t make any sense,” he added.

NBN Co has so far spent $2 billion on the fixed wireless portion of the network, which will deliver no economic return. It flagged a 100 mbps wireless service in March 2017 but Mr Morrow said that making such a service available to all homes on the fixed wireless technologies would not be viable.

According to NBN Co, over 600,000 homes will be covered by fixed-wireless technology.

“If you want all of those users to have 100 mbps speed at the same time in the evenings, you would be blown away by the cost, it would be billions of dollars that we would have to invest into that, Mr Morrow said.

NBN Co does have a significant amount of premium 5G spectrum - over 75MHz of 3.4GHz and 3.5GHz spectrum but Mr Morrow said that NBN Co was not keen to use that spectrum to deliver higher speeds on fixed wireless.

However, In the metro areas, Mr Morrow said that NBN Co would be willing to give away or share it spectrum.

“There are some arguments that others can use the spectrum better than we can and that may be the case.”

“That’s why I don’t hold to own the spectrum in a way that on one can touch it, if there’s a better use for the spectrum and a case can be made for how we can migrate off of that and still support our customers, then let’s get it done,” he said.

“We have no intention of using the spectrum were we don’t already have a fixed wireless footprint design.”

On the wholesale pricing front, Mr Morrow has ruled out any further changes despite the recent push by the telcos, especially Telstra.

According to Mr Morrow, the new pricing model set to come online in October, which will see NBN Co charge telcos $45 a month for a 50Mbps wholesale service and $65 for a 100Mbps wholesale service, are here to stay.

“We have no intentions of pulling that off,” he said.

Meanwhile, the restart of the stalled NBN HFC services will be a slow but steady affair, according to Mr Morrow.

He said that NBN Co was prioritising customer experience over trying to recover ground lost because of the rollout suspension.

“The ramp up of the HFC network will begin slowly for us so we can monitor the changes that we have made and ensure that the service is of a quality our customers expect.

NBN Co has already put several thousand HFC premises back onto the market and will have around 40,000 ‘frozen’ premises for sale by the end of June.

From July onwards another 100,000 ‘frozen’ premises will be put back onto the market every month.

NBN Co pressed pause on the HFC rollout in November to fix the infrastructure after hundreds of thousands of homes received poor NBN services over the pay TV cable. The company said at the time that its primary focus was on improving service quality for the 370,000 HFC customers.

With work still underway to fix the HFC network, Mr Morrow said that NBN Co was taking a quality over quantity approach to the fibre to the curb (FTTC) portion of the network, with activations on that access technology proceeding slowly.

“We have taken a similar approach with our recently launched FTTC technology, early results are good but it’s important to remember that we are first network operators in the world deploying FTTC at this scale.”

NBN Co wants to connect just over a million homes over FTTC. The cost of delivering the technology is currently pegged at $2900 per home and Mr Morrow has ruled out any plans of adding more homes to the footprint.