NBN Co's Wireless Coverage Gap Will Cost Over $1 Billion To Fix

Malcolm Turnbull warned that this could happen. The NBN's Fixed Wireless and Satellite network is in strife, and it's going to cost over $1 billion to make it right.

Image: Getty

The National Broadband Network Company has gone cap in hand to the government today in a new report, asking for up to $1.4 billion to fix a dramatic underestimation of its fixed wireless and satellite capacity.

The fixed wireless and satellite component of the NBN was designed to give those outside of the fibre-to-the-node footprint access to internet speeds at a minimum of 25/5MBps.

Initially, the NBN Co had provisioned $3.5 billion to build around 1400 cell towers and launch two satellites to cater for the demand. That demand had been estimated at around 230,000 premises. Nope.

The review into the fixed wireless and satellite network found that NBN Co underestimated the demand by around 400,000 premises, meaning that 2900 towers will now be required, and possibly a third satellite.

This means that NBN Co will need up to an extra $1.4 billion to solve the shortfall, depending on which of the four options it selects as a solution.

Option one would involve the company rolling the missing premises into the FTTN network, provided that the copper infrastructure around them meets certain criteria. Second would be to split the build between more cell towers and more FTTN. The third would see NBN Co build a third satellite, despite the fact that less than half of its capacity would be used (we assume, NBN Co redacted it in its report). The fourth is to rent a third satellite.

You can read the full report here.



    Hands up who thinks the budget will include some sort of scaling back or delaying of the NBN? Anyone?

      It won't, because the budget is based on recurrent spending.

      The NBN is capital spending where the government borrows money now, to sell the network back to private companies at a later stage (10 years after completion if i remember right).

      I hope TPG buys it.

    Sigh... 12, not 25 and the units are megabits per second (Mbps), not megabytes per second (MBps) as written in the article. But hardly anyone will notice or care...

      We care! Notation mistake, sorry -- it's changed to Mbps now. And apparently it *is* 25, as detailed in the new report (exhibit 1-1) -- I'll defer to Luke to go into more detail.

      pedantry is never easy to ignore either

        The difference between bits and bytes is not a matter of pedantry.

      The original plan guaranteed access to the 12/1 tier for all premises (with 25/5, 50/10 and 100/20 reserved for the FTTP areas), but in February 2013 the plans were changed, evidently on the basis of positive results from the initial test rollouts, to make the 25/5 tier available to the fixed wireless and satellite areas also.

    Why can't any federal or state governments get anything right the first time? This is the people's money they're throwing around willy nilly. I know it's NBN Co asking for it, but it's still our damn money.

    I can only imagine any politician in charge of anything goes to their mate in that sector and gives them blank cheques. Even then that's still not enough money apparently.

    Last edited 07/05/14 3:22 pm

      I agree that it would be great if federal and state governments got it right the first time, but I think it is important to acknowledge that the private sector at least sometimes makes quotes that are at least this far off (and sometimes much more). However, we tend not to hear about it from the private sector because it doesn't need to become public.
      (I am not aware of anyone having done a systematic comparison of the difference in accuracy of private vs public sector estimates for infrastructure, but it could exist).

    This should have been a priority anyway, and it would have cost extra anyway...

    I love how much is redacted in that original sourced report.

    I'm sorry Luke but this article is pretty much hysterical hype. NBNCo. already planned for this extra $1.4 billion within their initial $41 billion CAPEX (contingency) . This a minor course correction that had contingency built for, not a 'blowout'. And if anything, all it proves is how much Australians need better broadband in regional & rural areas as WELL as urban. And now the Coalition are going to scratch the urban part down to barebones.

    I wish people would read the history of this stuff before shooting off click-bait headlines.

      So they have to cover twice as many premises as the original plan called for, and they need more money for this? Wow!

      Indeed, it simply proves how under-served consumers are by the status quo.

      Are you able to please provide a source showing this was already planned for in their initial CAPEX? Thanks.

        A 3rd satellite was planned in the original $41B. The increase in wireless coverage was noted as a distinct possibility in the final Senate Committee report on the NBN before government change. NBNCo. said either contingency would have to be used or other planning would have to take place based on uptake.

        It simply wasn't reported because of all the campaign bastardry.

    You couldn't have picked a more ghastly photo, Giz.
    That greasy smug grin makes me want to puke.

    I love how we are confronted with announcements that Country X has just rolled out gigabit fibre to region Y while we languish over an incompetent and short sighted political system that cant even put together a 25 megabit solution

    Way to look like the ass-end of the tech world that we are perceived to be

    Last edited 08/05/14 7:49 am

    Whats this "perceived to be" you speak of!! You mean we arent?

    So NBN fixed wireless constructed during the reign of Queen JuLiar and King Kruddy falls short of the mark. New government comes in under the Mad Monk Abscess has to spend money to fix it. How is this the new governments fault?

      I don't think the article does suggest it is any Governments fault, in fact the first sentence is that the current Comms Minister predicted this.
      Not really relevant, but am interested that Julia is still referred to as a liar for introducing a tax that she said she wouldn't. Will be interesting to see if Tony's new tax qualifies him as a liar too.

        Perhaps you can ask Andrew Wilke from Tasmania if he thinks Julia is a liar? Or Slater & Gorden on why she was sacked, oops, mutual parting of the way. Or Vicpol fraud squad on the AWU fraud investigation.

        It's one thing to break a promise in a changing political climate (she didn't need to bow down to the greens anyway but stupidly did) and another to promise an independent member pokie machine reforms, but renege when you no longer need his vote. She is a grub, and it showed. Even her party agreed.

        So when an incoming government finds a fiscal disaster (iceberg) it should just stay the course and not avoid a long term shipwreck? Only an idiot would think so. If only labor weren't such morons and blow our money, we wouldn't be getting the thumbscrews from this current mob. Alas, it has always been this way. Some people never learn.

    Be nice to actually start seeing more of the promised towers especially in the Central Tablelands where they were supposed to be already built and up and running.

    1. Change the laws to stop morons from blocking them especially in areas where they already have mobile phone towers which put out more radiation then the nbn towers.

    2. Adjust the law to prevent someone suing due to there so called vision/view being obstructed or made worse by a tower. It is called progress get over it.

    3. Get them bloody well built

      4. Change the laws to stop people who cant spell from getting an internet connection.

    So will Joe Hockey find the fixed wireless towers 'offensive' and a 'blight on the landscape'?

    Just out of curiousity. Did the number blow out because suddenly people who were 'going to get fibre' now couldn't and thus started the over-subscription of the other services? Curiousity. I haven't checked.

    hmmm, the article has no mention of Tony Abbott yet we still managed to get an unflattering photo of him.

    Sadly, stupid politicians listen to the moron minority that just want to stop progress just for the sake of it. Don't they realise the majority put them there to do the job, not pander to hippy dole bludgers? Country Victoria went up in flame in 2009 because idiot councils pandered to the greenies, and not do fuel reduction. And people died. Thanks to the greenies. Proof that fringe dwelling pot heads, should be ignored completely.

      please explain

      Actually it seems the moron minority is now in government...

    I think a revolution in this country is needed.

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