Wireless vs Wired

The Wireless Debate (Fibre vs Wireless)

Throughout the last few years, a number of commentators have asked the question “why not just create the NBN using only next-gen wireless technology?”

NBN Co chief Mike Quigley discussed this possibility at the CommsDay summit. “Quigley presented a scenario … where NBN Co would have access to the entire spectrum allocation to be vacated in the analog-to-digital TV switchover – known as ‘the digital dividend’.

“To get a committed rate of 5 Mbps, you would need 80,000 cell sites,” Quigley said.

“We have 16,000 today so we’d need to multiply today’s wireless networks by five to get a committed information rate of 5 Mbps to 60 percent of premises.

“And of course if you have 80,000 cell sites around the country, what do you connect them up with? Fibre. So you still need ubiquitous fiber.”

Computerworld did an article which compares fiber and wireless solutions in the context of the NBN. The articles discuss the two major 4G technologies WiMAX and LTE and their potential to replace a fiber NBN.

“WiMAX as it currently stands in Australia is untenable as a nation-wide broadband network, and certainly isn’t capable of delivering the committed 100Mbps speeds that the Federal Government proposes to deliver for at least 90 percent of Australians.

Unlike optic fiber-based network technologies, the WiMAX technology’s greatest asset is also yet to make a strong appearance in commercial reality. 802.16m WiMAX, otherwise known as “WiMAX 2?, purports to deliver peak speeds of 300Mbps and lower latency than previous generations to make applications like Voice over IP (VoIP) easier to deliver over the network. However, the specification is yet to be finalized and, while reports earlier this year pointed to 2011 as the beginning of the standard, the timeline has since been pushed back to 2012 according to Intel.

The other major 4G technology, Long Term Evolution (LTE), has been marked as the direct successor to current HSPA services by industry body 3GPP, with greater capability for VoIP and telephony services under an all-IP network.

LTE sees a shift in the way most broadband and telecommunications players operate. LTE’s all-IP technological foundations essentially require operators to switch off existing 2G and ultimately 3G networks. While this is inevitable at some point, it also means a potentially massive shift with similar repercussions to the shutoff of the Australian CDMA network in 2008.”2

As the above graph shows in the real world LTE provides much slower speeds, Verizon “…estimates that a real connection on a populated network should average between 5Mbps to 12Mbps in download rates and between 2Mbps to 5Mbps for uploads … The speed is significantly less than the theoretical 100Mbps promised”34

“If Mike Quigley is right, and Australians demand speeds of up to 1Gbps by the year 2020 … fiber can meet those needs; current and foreseeable wireless broadband technologies can’t.”5

However, there is another component to this debate; a number of commentators have also claimed that the growing “…popularity of 3G wireless broadband services has the potential to cannibalize National Broadband Network subscriptions.6”

In January 2010 Exetel boss John Linton commented that people “…want mobility and are content with speeds at 10 percent of what’s being proposed under the NBN.”7 His comments came after an ACMA report which showed a 162 percent increase in the uptake of mobile broadband services.

One of the issues with this claim is that although the mobile wireless internet is increasing at a fast pace so far ABS figures have shown that it is not at the expense of DSL. The following graph shows that the number of DSL subscribers is actually increasing albeit more gradually.

In response to Linton’s post-Conroy commented that “The growth in wireless services does not have to be at the expense of fixed broadband, or vice versa. At a more technical level, wireless and fixed broadband technologies are complementary”.8”

Conroy’s statement is mirrored by the latest ABS statistics. While the statistics show wireless subscribers are steadily increasing, they also show the amount of data downloaded with DSL is increasing and conversely the amount of data downloaded over wireless appears to be shrinking en masse.

Clearly, DSL has jumped massively in the amount of data downloaded… zooming in on wireless for a moment:

One would assume this shows wireless is a complementary technology, even with the increase in subscribers the amount downloaded with wireless is decreasing. This shows that people continue to turn to fixed lines for heavy lifting, DSL averages 33GB per connection whereas wireless averages only 3GB. A report released by the ACCC in March 2010 supports this statement.

While we see the increasing popularity of wireless and mobile platforms as encouraging, the degree of substitutability between the technologies needs to be considered in context. The demand shift towards mobile and wireless services is generally confined to those consumers requiring voice-only services and/or low data usage. Technical restrictions due to backhaul capacity from mobile base stations and spectrum limitations pose significant barriers for mobile and wireless platforms. Therefore, while we will keep the matter under consideration, our present view is that these platforms are unlikely to be closely substitutable for the fixed platform in the provision of the full range of services offered on the fixed network.9…