Vocus calls for backhaul component to mobile black spot program

Network operator Vocus says that the government should consider funding carrier-neutral backhaul as part of its mobile black spot program.

The federal government in 2015 launched the mobile black spot program, and as of 20 March this year 683 base stations partially funded by the initiative had been activated. 

In total the government has put $760 million towards the program’s four rounds, helping fund 1047 base stations in parts of Australia areas that are judged to lack adequate mobile coverage.

Last month the government said it would support two additional rounds for the program.

Infrastructure built as part of the program is co-funded, with contributions from federal, state, and local governments, businesses and communities as well as Optus, Telstra and Vodafone.

Most of the base stations receiving funds from the government are operated by Telstra, with Australia’s largest telco successfully applying for co-funding for 780 sites.

“The mobile black spot program has undoubtedly been a great success delivering new mobile coverage to regional communities, and it could be even more successful with a fresh approach to the program’s design, which could deliver both coverage and competition to these areas,” Vocus Communications’ head of product and marketing, Charlotte Schraa, told the Comms Day Summit, held earlier this month in Sydney.

“With the introduction of a carrier-neutral, wholesale-only backhaul provider, the program would incentivise mobile network operators to focus their investments in towers and radio equipment, with a neutral party providing backhaul to these sites.”

“This would avoid the competitive downsides of a vertically integrated tower and backhaul model, and be another big step to introducing more competition in regional Australia,” Schraa said.

The Vocus executive cited as an “indisputable success story” the Regional Backbone Blackspots Program. The $250 million RBBP was launched in April 2009 by the former Labor government (the program was announced alongside the government’s decision to establish a company, NBN Co, to build a national broadband network).

Nextgen Networks in December 2009 was announced as the successful tenderer for the RBBP, with the network operator rolling out 6000km of fibre links in regional parts of Western Australia, the Northern Territory, Queensland, South Australia and Victoria. The final link was completed in December 2011. (Vocus in 2016 acquired Nextgen Networks.)

The 2011–12 Regional Telecommunications Review concluded that Nextgen’s network was “providing significant economic benefits for communities covered by its backhaul”. Vocus is contractually required to offer access to the RBBP fibre on open and equivalent terms and conditions.

The RBBP “used targeted government subsidies to deliver backhaul competition in areas which would never be commercially viable in their own right,” Schraa told the Comms Day event.

“Vocus is proud to be the operator of this program, as we have introduced competition to key parts of regional Australia for the first time,” she said.

“It’s a perfect example of how backhaul competition is lowering costs and improving people’s lives in regional Australia, and it is part of the reason why Vocus is perfectly positioned to help deliver 5G in these areas.”

“5G simply cannot be delivered without fibre, and in regional Australia where operators already struggle with low population-densities, the business case for delivering 5G is made all the more difficult by the cost of connecting fibre tails to geographically remote sites,” Schraa said.

“That’s why we see a clear role for a carrier-neutral fibre provider like to Vocus to help make the numbers stack up for 5G in regional areas, where efficiencies of scale can exist for multiple operators sharing tower and backhaul costs.”