NBN Co to spend circa $1 billion on satellites

Two KA band satellites will supply around two per cent of NBN capacity

The NBN Co will spend up to $1 billion on two KA band satellites to deliver National Broadband Network (NBN) services to Australian households unable to access coverage via fibre or wireless.

The plan, announced at the Committee for Economic Development of Australia’s (CEDA) recent 2010 ICT Review conference in South Australia by NBN Co chief executive officer, Mike Quigley, will see two satellites launched to deliver around two per cent of the total capacity of the NBN.

“We will cover the whole country with satellite,” he said. “The fact is even within 40 or 50 kilometres of Sydney and Melbourne there are places you can only get to with satellite. Fibre is too difficult to get to them and the terrain is such that you just can’t get propagation of the wireless signal effectively and get a reliable service.”

Outlining the plans for satellite services under the NBN, Quigley said the decision to spend up to $500 million each on two satellites was prompted by a current lack of viable satellite services.

“There is simply nowhere near enough the capacity in today’s satellite services over Australia to provide the sorts of services we are talking about – that is, close to the wireless service of 12 Megabits [per second] at peak and be able to do a lot of bandwidth,” Quigley said.

The news may come as a surprise to some in the Australian satellite industry, notably NewSat, which earlier this month argued that it could deliver broadband speeds of “better than” 100 Mbps to the seven per cent of Australia not covered by the NBN’s fibre network and for an equivalent cost.

According to Quigley, having two satellites would allow for the NBN Co to provide redundancy as well as maximise capacity and speeds.

“You could potentially do it with one [satellite], but the trouble is if we have some 200,000 premises on a satellite -- they take roughly four years to design, build and launch into orbit -- and so if one of them … gets hit by a piece of space junk, I don’t want to wake up one morning and find that 200,000 people without a service and it will take four years to restore it,” he said.

NBN Co was also investigating technology which would allow premises receiving satellite broadband to automatically switch over coverage between satellites to get the best possible speed, and also in the event of a failure in one of the satellites.

“We are dimensioning the capacity on the satellites,” he said. “With the new generation satellites you can get capacities in the 30s, 40s, even approaching 100 Gigabits.”

Wireless being overhauled

Commenting on the role of wireless technology under the NBN, Quigley said the NBN Co was currently investigating the reuse of around 2000 cellular sites around Australia to maximise limited spectrum available to the NBN Co.

“What we are trying to do is make sure we overcome some of the issues you do have with normal mobile networks,” he said. “Because we have to use that spectrum, because it is so expensive to get it out these distances, we do need to modify the [wireless] product slightly. Clearly we can’t do 100 Megabits per second – it has to be dimensioned a little differently.

“If you are in the wireless coverage area it should not be variable, in terms of the performance speed. The performance you get at the edge of the cell should be just about the same at the centre of the cell.

“We will be dimensioning this network almost an order of magnitude more traffic than what a mobile carrier does today.”

NBN’s business case

The NBN Co boss also gave one of the strongest indications that the National Broadband Network was never meant to have a business case supporting its existence, stating that he, and fellow private-sector staff at NBN Co, were in the process of reorienting themselves to the NBN’s raison d'être.

“Our job is not to necessarily maximise the bottom line,” he said. “The job is to implement government policy as quickly and as efficiently as we can.

“This is not a normal commercial venture. A normal commercial entity would not do this job. What they would do, is what all of us would do if we were running a business and trying to maximise the bottom line: we would go and pick off those areas where there are high densities and customers who can pay [the most].”

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