Elon Musk muscles in on NBN’s turf

The National Broadband Network (NBN) is facing competitive threats on all fronts.

Telstra, Optus and TPG are currently rolling out comparatively affordable, fast 5G wireless broadband to compete head-to-head with the NBN.

Telstra, for example, already offers a lightening quick 4.2 gigabits per second (Gbps) on its emerging 5G network, which is around four times faster than the quickest NBN plan currently available to households.

Now billionaire Elon Musk’s space venture SpaceX / Starlink is muscling in on the NBN’s turf, taking pre-orders for Australian addresses, with estimated coverage expected from mid-to-late 2021.

According to its website, Starlink “users can expect to see data speeds vary from 50Mb/s to 150Mb/s and latency from 20ms to 40ms in most locations over the next several months as we enhance the Starlink system”.

Musk also promises to “launch more satellites, install more ground stations and improve our networking software, data speed, latency and uptime”, which will improve the service.

Starlink preorders cost $139. And when the service goes live, customers will need to pay $809 for hardware (satellite dish + shipping) and a $139/month service fee.

While Starlink’s cost is rather expensive, it could be enticing for regional NBN users suffering poor speeds and performance.

In any event, Starlink is another competitive threat that will cut NBN’s revenue and market share, especially across regional areas. It also comes on top of the likely loss of market share to 5G across Australia’s capital cities.

Australian consumers face both benefits and costs from these developments.

On the one hand, consumers will get to enjoy greater choice in internet services, alongside falling plan costs – major benefits.

At the same time, every consumer is also a taxpayer. Thus, with reduced subscriber targets and lower profits (or bigger losses), the NBN’s “fair value” (or saleable value) will also be shaved, ultimately resulting in a heavier federal budget write-down from the NBN’s already skinny $8.7 billion valuation (which was less than one-third of the federal government’s equity investment).

Unconventional Economist
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Comments

  1. Telstra, for example, already offers a lightening quick 4.2 gigabits per second (Gbps) on its emerging 5G network, which is around four times faster than the quickest NBN plan currently available to households.

    a couple of questions….

    1) What are the congestion rates on their 5G network like at the moment…
    2) Is this 4.2Gbps like all other Telstra speed offerings, i.e. best case yet completely unachievable and not guaranteed?
    3) Do they offer an unlimited plan for this that doesn’t require selling your first born in to slavery?
    4) What is the peak speed achievable by 5G? With normal fibre to get higher speeds you only need to change the transceivers on each end. Current transceivers are capable of terrabits/s. admittedly the fibre offering currently used by NBN is likely not capable of this due to the choice of fibre but the point is NBN is upgradeable as technology improves…. Once the 5G network is rolled out we are stuck with its upper limits until the entire infrastructure is replaced.

    Also, for the Starlink solution is that $139 a month unlimited?

    • ” admittedly the fibre offering currently used by NBN is likely not capable of this due to the choice of fibre but the point is NBN is upgradeable as technology improves”
      Given the choice of fibre for our house was legacy copper, it is mighty hard to get those laser transceivers working, and to upgrade it is effectively start from scratch and do it again. Thanks Malcolm, you legend……

      • Yeah, I know there are “mixed mode” solutions in play here but mentally I struggle to admit they are there……

        Also…as There are no gigabit solutions available on the copper carriers so I didn’t make the comparison..

        And yeah… Thanks Malcolm… But it wasn’t just him…..

  2. An PHY over an uncontrollable medium (the air) is always significantly more inferior then a controlled medium, so no matter much you develop things like LTE they will never catch up to a fixed network.

    • In theory, yes, in Australia, no.

      The government has a PHY wired monopoly and will charge more, fir less, while the free market runs the airwaves at higher bandwidths.

      So this is a valuable lesson to you in how the rules of Physics are trumped by the rules of Economics.

  3. BoomToBustMEMBER

    5G has beam forming tech, they will know where you are to within 6 feet of your precise location. Its not enough to know what tower you are near, they now want to know your exact location.

  4. Elon Musk and his Starlink can get fukced .

    Filling the night sky with rubbish so crew can play video games …..Christ almighty

      • There’s more to life and the world than internet access and speed . Musk has no mandate from the people to pollute the sky with his fantasy. Hurry up and fck off to Mars Elon.

        “Another concern is that the satellites are very bright, outshining 99 percent of all other satellites in the night sky.

        Because of this, astronomers have reported that the satellites are hampering their ability to study the universe. The satellites can appear as bright streaks in telescope images, ruining observations of galaxies and stars.

        With many more satellites set to be launched, astronomers have raised concerns about the number of satellites that will be visible in the night sky.

        By some estimates, hundreds of Starlink satellites could be constantly visible in the night sky from any location on Earth. This could ruin the natural beauty of the night sky, and make astronomy much more difficult.

        Currently there are no laws or regulations that protect the aesthetic of the night sky. But some people are looking to change that, and potentially take legal action against SpaceX.“

        • Good glad someone is ready to take action against more satellite pollution of our skies and light pollution as well. I yearn for snappy white stars in an inky sky, Aus has the most beautiful night sky if away from cities. Nothing much in northern hemispheres, think our star view should be part of wonders of the world.
          That said pollution by satellites and debris is an emerging recognised problem. Very difficult to leave earth into space with the junk in the way, I am not interested in Aus having any part in funding the cleanup lying ahead. Add in Bill Gates and Harvard dumping material in the high atmosphere to block sunlight. No word from Greta as Europe faces another year of -20 degree long winter.

  5. Starliink despite being horrible sky pollution is still 3 times faster than my NBN thanks to the crippled product the LNP rolled out in the end. Someone will have to rip most of it up and eventually install fibre to peoples homes as the current system is stuffed.