vodafone

NBN’s mobile backhaul service launching end of next year

Kenneth Tsang 1 Comment

Cell Access Service will allow mobile carriers like Vodafone to use the NBN’s network to connect mobile towers.  But has this come too late?

Vodafone has long campaigned the company building the National Broadband Network, nbn, to open its fixed-line network to mobile carriers like itself to quickly and relatively cheaply connect mobile towers.  Vodafone and nbn had begun trialing such a service since mid-November in 2013.  According to the latest Integrated Product Roadmap released this month, nbn intends to continue trialing the service until the end of 2016 when it expects to officially launch its Cell Access Service product:

The Cell Site Access Service will provide connectivity between cell sites and nbn Points of Interconnect.

The Cell Site Access Service will provide connectivity between a network operator’s mobile cell-sites and nbn’s Points-of-Interconnect and also nbn’s fixed wireless ‘hub’ sites where they are connected to the nbn Points-of-Interconnect by fibre. The service will initially be offered within the FTTP and FW footprint, with the potential for it to be expanded to include other parts of the Multi Technology Mix network in the future.

But is it too little, too late?  Earlier this week however, Vodafone and TPG announced that as part of a $1 billion dollar deal — TPG will provide fibre for the mobile carrier to connect its mobile network towers for the next 15 years.  It’s unclear if this is an exclusive deal where Vodafone must only use TPG as their only backhaul provider, but it may significantly reduce nbn‘s prospect in profiting from such a service.

Last month, I wrote about how NBN could transform the mobile transit market.  While it may still ring true — with Vodafone now seemingly out of the game for NBN-based mobile transit — one must wonder how much nbn could realistically expect from its new product offering.

Mobile Broadband is fast becoming the new printer industry

Kenneth Tsang Leave a comment

Dirt-cheap printers, sky-high ink costs. Australia’s prepaid mobile broadband market is replicating the printer industry’s business model.

When you compare monthly mobile broadband plans with the starter kits you can get at your local supermarket or technology store, you would find an unfortunate truth.  Starter kits, often including a Wi-Fi 3G modem, are comparatively cheaper than your monthly access cost.

Last month, I saw an excellent deal.  I bought two Vodafone 3G Pocket Wi-Fi + 3GB SIM (with a bonus 8GB SIM with 90 day expiry) for a mere $38 from Harvey Norman.  That’s 22GB over a total of 240 days.

Compare that with the closest prepaid plan in terms of cost: the $40 Vodafone Mobile Broadband recharge — which will only give me 4.5GB over 40 days.

The 22GB offer Vodafone currently provides online is $200, albeit with an expiry of 365 days.  That’s a whopping 5x more expensive!

Invoice summary showing my Vodafone 3G Modem + data purchase. 22GB for $38!
Invoice summary showing my Vodafone 3G Modem + data purchase. 22GB for $38!
Purchase option Total data Expiry Total cost Cost per GB
2 × Vodafone 3G Pocket Wi-Fi + 3GB (+ bonus 8GB) 22 GB 240 days $38 $1.73
1 × Vodafone $40 MBB Recharge 4.5 GB 40 days $40 $8.88
1 × Vodafone $200 MBB Recharge 22 GB 365 days $200 $9.09

We haven’t even accounted for the cost of the Wi-Fi modem that comes with the starter pack.  A Huawei-made Vodafone Pocket WiFi R207.

Original packaging of the Vodafone Pocket WiFi 3G
Original packaging of the Vodafone Pocket WiFi 3G

This is perhaps one of the most extreme cost differential examples — however, this same phenomenon is replicated across all major carriers.  Telstra and Optus both have the same tactic of selling mobile broadband dongles for below-cost and bundled with a generous one-off data bonus.  Sounds awfully like a printer company, am I right?

What’s the catch?

The business model that the major carriers are using promotes the mass purchase of SIM cards and mobile broadband devices.  What’s the problem?

Firstly, Australia is fast running out of mobile phone numbers with the ACMA projecting phone numbers will be exhausted in 2017.  If each person in Australia simply buys new SIM cards with new phone numbers to take advantage of these deals, the depletion of mobile phone numbers further accelerate.  Luckily, the 05xx number range has been reserved for future expansion — nonetheless, getting new numbers for each new SIM purchased is unsustainable.

Secondly, it’s an account management nightmare.  Each new SIM would need a new account login on the mobile carrier’s website to check and keep track of data usage.  It would be a pain to have to change this every month.  Also, Australian’s are expected to declare how many phone services they have active under their name — this could be massive if we end up buying new SIMs every month.

Lastly, we have the same environmental issues as printers — we’ll end up with far more mobile Wi-Fi modems that we’d possibly need.  Personally, I’m currently in posession of 5 mobile broadband modems while I’ve been taking advantage of these deals — three Telstra modems and two Vodafones.  Most of these — I don’t use and to be honest, I’d be happy to give away.  It just goes to show how much waste there is in electronics these days.

And the printer…

Yes. I also bought a printer. Harvey Norman was also selling a multi-function inkjet printer for $17 that I couldn’t resist but buy.

Harvey Norman selling the HP Officejet 2620 All In One Printer for $17
Harvey Norman selling the HP Officejet 2620 All In One Printer for $17

The printer even has clicky buttons, an LCD screen, fax functionality and a document-feeder scanner.

I’m yet to use any of its ink, I bought it purely for its document-feeder scanner to move towards a paper-less environment.  I think I have broken their business model.