Will 5g roll-out cut NBN’s lunch?

By Leith van Onselen

NBN Co CEO, Bill Morrow, last year warned that Australia’s National Broadband Network (NBN) faces damaging competition from the upcoming 5G network, and called for a levy on mobile broadband services, which was thankfully rejected.

Today, The AFR reports that one-in-three households are looking at 5G wireless services for their home internet connection, thus threatening NBN’s rollout of fixed-line broadband:

One in three Australian households is interested in subscribing to 5G wireless services for its home internet connection… 41 per cent of households would use 5G wireless services to either replace or supplement their fixed broadband, according to the Telsyte Australian Mobile Services Market Study FY2018.

5G, the technology that is expected to replace the 4G networks at Telstra, Vodafone and Optus during the next few years, is capable of speeds of up to 20Gbps, much faster than the 100Mbps that most NBN customers are limited to…

A figure of one in three households using 5G instead of fixed-line broadband is roughly in line with Telstra’s prediction that the advent of 5G will increase the number of wireless-only households from 15 per cent at present, to 25-30 per cent in coming years.

The situation is probably not as dire for the NBN as suggested above. While mobile internet is growing strongly – and will likely continue to do so – the ABS’ internet usage data shows that while mobile wireless has grown strongly:

Data downloaded via fixed line broadband (3.7 million Terabytes) accounted for 96.8.% of all internet downloads in the three months ended 30 June 2018:

Thus, fixed line broadband will likely remain the dominant choice.

Still, any additional competitive pressure on the NBN will only compound its losses, driving an even bigger writedown for the federal budget.

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  1. It’s literally physics.

    Wireless will never be able to match the bandwidth that a fixed line connection can offer.

      • Yep – fit for needs. This was always going to happen with the NBN. Same reason we don’t have high speed rail – uneconomic for the users.

      • correct. but who knows what scientists will develop in 15-20 or 30-40 years time. There will be a point where wireless will replace cables in the consumer market.

      • Yes – and fibre is literally MILLIONS of times cheaper than mobile – is MILLIONS of times faster – and will be cheaper and faster until we have a quantum telecommunications for mobile phones – sometime around 2150 .

        A single strand of Fibre can communicate the entire global consumer internet data requirements over a single strand upto 3,000 kilmoters. Petabytes over a single strand.

        Do we need it ?

        Considering Netflix is just starting to hit Australia with 4k and the experience in other nations has been to max out their internet – it would crush 5g.

        Considering most houses now have at least 5 screens – each one on its own would crush a wireless connection at 4k – 5 of them ?

        Now consider that 8k is being adopted. Double your requirements.

        But this is NOTHING.

        I was speaking with a supplier to of radio parts and routers for Telstra mobile who was saying that Fortnite updates and crashing the national network. This is just ONE kids game. The success of Fortnite means there are going to be dozens of these things – each updating every week.

        I was in Lorne when an update came through – the town literally shut down. Lorne is on the NBN. imagine on mobile……holy smoke.

        People advocating 5G as a replacement for Fibre or NBN literally do not understand anything at all about tech. There is no discussion on this – its a complete and utter Luddite squabbling with Tim Berners-Lee.

        That said yes there will be some people who will go for 5G – just like there are some people who use firelighters to cook their food. Are firelighters a replacement for a 5 burner stove with wok, convection oven, hot water service, ducted heating and pool heater ?

        Yes if you think 5G is a replacement for NBN.

        Are firelighters all you need for you and your family to heat your home, cook your food, heat your water ?

        Yes if you think 5G is a replacement for NBN.

        This sounds like an absurdist, ridiculous, outlandish comparison – but to anyone who understands the very basics of 5G and Fibre and technology in general – this is exactly how absurdly ridiculous you sound.

      • Hyperion

        A lot of people are more than happy with Netflix at 720p.
        Frankly, it’s hard to tell the difference between 720 and 1080 on your average 40″ TV.

        BTW, spent the better part of 20 years in IT/Telco. I’m inside a telco, at work, right now.
        No one gives a crap what tech is behind anything. Only whether it works good enough for what they want at the price they want to pay.

        Fibre isn’t cheaper by a long shot. It’s better in every measurable technical way, but it’s not cheaper.

        It’ll only take 20-40% of lazy gen y/z’s who cbfd dealing with the additional expense to ruin the economics of the NBN and cause prices to rise similar to the way “off the grid” is potentially a death spiral for power.

    • True – but it is also about economics and politics. We went for a copper and not a fiber network. NBN co is charging too much for backhaul.

      Optus already offers 4G 200GB for $60 a month. It works and satisfies the needs of most NBN users at a similar speed and price.

      Fixed wireless will kill the NBN in its current form.

      The laws of physics and mathematics don’t apply in Australia anyway, according to Turnbull:

      “The laws of mathematics are very commendable, but the only law that applies in Australia is the law of Australia,”

      • Vivid isn’t available in most places, including where I live. Plus, last time I looked at it, it was pretty severely speed-gated as the lowest priority traffic in an area, if you’re in an area with lots of traffic. I live in a touristy/daytrpper area, so there’s lots of mobile phone use here.

        The speed-gating to the poor end of NBN performance levels isn’t really what many households who want to access streaming and online gaming are after.

    • My concern is the lack of concern around the potential health impacts. There is significant evidence of the negative effects of EMR and especially 5G which has been used for Smart Meters. Almost makes you wonder if they sabotaged the NBN technically or are they just incompetent.

  2. Depends on the price and real world performance.

    $50 for 200gb at 20mbit average would meet most average Netflix and Facebook users needs and represent a significant threat.

    • Yes, it would, but will the small-opoly, high-entry-cost-market telcos actually OFFER 5G at that kind of pricing? I bet not.

      • Most people have smartphones with big data plans, you you take advantage of that. This is what I have with my wife: (kids are on Telechoice)

        #1 – Optus $110 = 200GB data
        #2 – Optus $110 = 200GB data
        #3 – Optus $10 = 3GB data

        total payable $230

        This gives two iPhone XS 64GB, which I sold for $1400 cash each. Plus both mobiles work overseas with 2GB roaming data. The third SIM goes into a Cat6 4G modem ($100 on Gumtree), and we both use iPhone 6S (has the headphone jack).

        Selling the phones ($2800/24) = -$116 when amortised over 24 months, taking monthly payable amount to $114. For that we get 400GB data at 35/20 speeds (could be better if I had cat9 modem instead of cat6). NBN is not available here, so its definitely better than 2.5/1 ADSL we used to have.

      • @myne, vivid isn’t available everywhere (not for me, for example), and when I’ve known people who’ve had it, they’ve gotten rid of it for unusable performance nowhere near 12/1 and lag unacceptable for streaming and online gaming.

        @Jonno88a Looks like you’ve found something that works for your family’s purposes. Good for you, and best wishes to your bank account when you hit overages unless postpaid plans have gotten a lot better about instant cutoffs the minute you go over your total transfer allowance. I’m prepaid wireless ONLY, because I’ve been stung for double-monthly-cost too many times due to overages. My other issue with postpaid plans with other than Telstra is that you just can’t depend on them working everywhere. For a renter such as myself, that adds a degree of risk in signup commitment.

        From my perspective, wireless plans still have a LONG way to go in availability and pricing at acceptable performance levels.

      • The average family – 2 parents 2 kids watching about 4 hours of Netflix / night ?

        HD Netflix is 3 GB / hour.

        That works out at 4 hours per night = 1500GB / Month

        @Jonno88a – what are you doing with your data ? Playing Pong ?

    • Can you even get a 4G wireless plan for your household for that price at the moment ?

      Let alone telcos needing to recoup costs of capital investment, network upgrades etc

      • Hyperion
        You’re missing the point. Read the NBN rollout plan and the business case it depends on. It was ~70% uptake to be profitable IIRC – and that was before all the delays and changes adding to the final cost.

        If it’s been pushed up to 80 or 85% break even, anything less than that = prices rise.

        Prices rising = a few more marginal low-mid end browse and stream occasionally users drop off and live with 4/5G only.

        I’m in no way saying wireless is BETTER, but it is FIT FOR PURPOSE for possibly enough people that it’ll cut into the business case of the NBN.

      • I agree with Myne,
        there are still plenty of Internet users that would be lucky to crack 20G / month limit and dont watch much / any online video. Sorry but for these people wireless 4G/5G will work just fine.
        Now IF this demographic is greater than 20% of the total market than NBN’s whole business case falls apart.
        If competition is allowed to cherry pick the best customers than NBN’s business case falls apart
        IF NBN can’t deliver average users 1TB / month for a reasonable price than NBN’s business case falls apart.
        Can you see a trend developing, a whole lot of things need to go NBN’s way for the business to be profitable yet stumble even a little and we could see alternative technologies take off and eat their lunch.
        Sure there is a limit to 4G/5G data rates per wired hub node but that just suggests that wireless guys will be installing Picocells, honestly what’s the real difference between Picocells on every lamp post and WiFi hubs inside every home with NBN service….technically the only real difference that I can see is the asymmetry RF field strength you inside with hub inside vs you inside with hub outside. But that is easily compensated for with appropriate Tx power controls on the mobile unit (user compensation for typical CDMA Near Far problem)

    • Remember Optus’ problem during the World Cup broadcast? As more people use it, the speed will suffer. which is the problem with mobile broadband.

  3. My view is yes it will. The NBN for some users will be fine and be able to sustain more bps, but for the vast majority 5G is the way to go, and as we’ll see before long Ghz Mesh systems. The only thing to slow 5G will be lack of network cells to support the data rates as more users connect to any given cell, or if your mobile as the number of users per cell rises and this will happen for IoT 5G; most new cars, autonomous cars/trucks. Plus all the other tracking devices that are coming as part of IoT.

    Not many people will be at home all day on the NBN, but they’ll be mobile on 4G/5G and Mesh eventually IMO.

  4. Wireless broadband is still basically unaffordable compared to fixed-line unless you do basically no video streaming during a month. That’ll keep fixed-line broadband in the market for years.

  5. I’d just be happy with something beyond 90’s tech. Currently stuck on ADSL at 3.5 / 0.3 Mbps, yet NBN FTTN rollout was completed in my street in June 2016. Effectively half the internet is dead (uploading & backup) is dead to me. Nothing on the horizon, silence from NBN, my local Federal member, perhaps I might get 25Mbps by 2021.

    • See my comment below. This NBN thing never coming to my joint… it’s a unicorn cross troll type of animal. It doesn’t exist but still f#$ks with you…

  6. 5g needs a large amount of small base stations (femtos) connected to a high speed wired backbone for it to reach the goal of using mm wavelength as its primary delivery.

    NBN compliments 5g not competes against it

  7. The data downloaded via fixed-line should be provided by the NBN. Someone should order the disclosure of that info.

    I think there is no need to link fibre to 90% of the houses. Just 50% will do and the other 50% can piggyback using WiFi.

    • If you’ve already run the fibre down the street, that is the main cost. Using the existing lead-in conduit and the old phone line as a pull through is a piece of piss.

      • I went from ADSL to FTTN – nobody needs to be home to upgrade from ADSL to FTTN. I am pretty sure people have to be home to get FTTP and get a few extra holes drilled into the wall because unlike copper phone lines, fibre carries no electricity.

        Granted, I know not how much extra 90% FTTP costs compared to 50% FTTP but building 90% FTTP is still time consuming compared to 50% FTTP.

      • If you are already doing a truck roll in the street, the cost saving to half-arse it would be minimal. While doubling the failure domain for every other residence.

  8. Right now in the US Apple, Google and others are battling over new spectrum (old spectrum revisioned) the FCC wants to release. The bandwidth wars have only just begun. Australia need not apply, there is nothing of value we produce that needs to go anywhere that doesn’t fit in a bulk container.

  9. JamesTheBearMEMBER

    5G is definitely a huge leap forward and for areas without NBN FTTH may well be compelling, but there are real problems with 5G, no least of which is that performance indoors really suffers, it doesn’t like walls much. In built up areas you get around that by having lots of cells, not so easy in rural areas. And congestion effects will will probably be worse on 5G than on NBN as you share the cells backhaul with every concurrent user on that cell. I expect some disappointed early adopters here…

  10. I have seen a lot of statements that Wireless 5G is the future and almost all of them are explained with the equivalent statements as ‘ Coz it Good Mate’. No where yet have I seen the actual specs of available bandwidth been suggested and no real world actual through puts have been seen yet. 4G was promised to deliver 100MB/s and for 95% of the population cant deliver a reliable 30MB/s.

    Wireless, even 5G suffers from a scale problem, the more users the more congested the spectrum becomes. It doesn’t make a lot of difference regarding more towers as each tower shares the spectrum and interferes with each other. At the moment the towers shift to separate channels within the spectrum to avoid this but this approach suffers conflict as the number of towers increases. The bandwidth available to each individual client in contact with the tower is a factor of the potential bandwidth, how many clients are active at any one point in time and the spectrum interference.

    All this and we are seeing the release of 400Gb/s fibre optic standards. Telstra have even had 1Tb/s connections between Sydney and Melb. Fibre suffers from losses due to attenuation over distance but on a point to point basis does not suffer conflict. Wireless suffers both attenuation and conflict.

    Both technologies are only capable of delivering the throughput that the backbones are capable of delivering. They just have different use cases. I dont see why streaming videos is a priority when commuting to work, at work, at school or in the Cafe with friends…. I do all that in the secrecy of my own home and I clear my browsing history regularly.

    As far as I can see the only reason 4G is not a lot cheaper and as a result lower throughput is due to the butchering and subsequent pathetic rollout of the NBN.

  11. I have NBN fibre into my apartment. I refuse to pay the $300 infrastructure charge to connect. I have unlimited data over 4g for $89/month. Netflix, iview etc steam fine. Looking forward to 5G. Lots of newer building dwellers in the same boat.

    • You know it always cost that much to get a 2-pair copper phone line connected to a new premises right?

      • No not being cheap. If I had ex Telstra copper being replaced I don’t have too pay the 300 to get NBN. They just need turn the fibre on a they get my business. They have to physically conect the ex telstra copper line to NBN for no fee. Doesn’t make sense.

  12. The 5G rollout that doesn’t exist yet?
    Have they managed to even agree what the 5G standard is yet?
    The 5G that doesn’t go through walls all that well?
    The 5G that would need ugly mobile phone towers every few blocks?
    That is experiencing significant resident backlash overseas and significant extra site charges because of all the extra tower density?
    The 5G that is likely only economic in very high population density areas?
    The 5G that will not fill the needs of most business users?