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Big three telcos make their call on mobile black spots

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The three big mobile network companies have all put in proposals under the federal government’s $100 million Mobile Black Spot Programme, which aims to improve mobile phone coverage in outer metropolitan, rural and regional Australia.

Telstra, Optus and Vodafone have all nominated locations where they want to build new base stations or upgrade existing ones. The location of these base stations and the successful contractors will be revealed at the end of June.

Paul Fletcher, Parliamentary Secretary to Communications Minister, said funding would be allocated individually to each base station and was not a “winner takes all” process.

‘The process is designed to maximise competition in two ways – between locations, and between bidders – to get as many new base stations as possible for the money,” Mr Fletcher said.

It is anticipated that around 250 to 300 new base stations will be built under the four-year scheme.

The Government will now begin assessing proposals for each proposed base station against the criteria, which includes: the number of kilometres of highway that a new or souped up base station would cover; the number of business and residential premises covered and the number of square kilometres in area that would benefit and whether a base station would deliver 4G.

One of the program’s aims is to “maximise the choice of mobile service provider for consumers’, so applications from mobile network operators to co-build and co-locate will be looked upon favourably and given extra weighting.

Mobile phone coverage is a subject close to many Australians’ hearts. Last year, the government asked the public, community representatives, businesses and local and state government to nominate areas with poor mobile phone reception and more than 6,000 locations were nominated.

Victoria notched up the most reports – 2,029, followed by NSW with 1,780, Queensland with 897 complaints and Western Australia with 523. ACT-dwellers were by far the happiest with their mobile reception with only four complaints while the Northern Territory registered only 25.

But the federal government is not giving the other two levels of government a free ride. It expects in-kind and or cash contributions from state and local government.

So far NSW has pledge $25 million to improve mobile coverage and WA has offered to kick in $35 million and Victoria had said it will support a bid for funding under the program. But Local councils in remote and regional areas have been particularly critical of the expectations placed on them to chip into the program, especially given that those most in need of better mobile phone coverage are likely to have the lowest rate base.

Australian Local Government Association (ALGA) Chief Executive Andrew Beresford-Wylie previously told Government News that although remote local councils viewed improving limited mobile phone coverage as imperative they were ill-equipped to meet match-funding demands.

“Rural and remote councils are generally the least capable financially of providing co-contributions for projects,’’ Mr Beresford-Wylie said.

“These communities are currently without mobile service because of the prohibitive cost of deploying the service and are financially struggling themselves.

“The challenge is how to deliver services under the Mobile Coverage Programme, within the limited funding available, to those regional communities where it would otherwise be non-commercial and uneconomic for carriers to do so (otherwise it) may bypass many of these non-commercial communities.”

A number of local councils have offered cash or in-kind contributions. In-kind contributions can involve access to land, power or existing infrastructure; help with civil works; planning approval or providing leasehold to a base station free or at minimal cost.

According to the Department of Communications’ Mobile Black Spot Programme Guidelines, in-kind or cash contributions (they are not separated in the table) have been received from: 36 NSW Councils, 2 in the Northern Territory, 33 in Queensland, 10 in South Australia, six in Tasmania, 17 in Victoria and 29 in WA.

Proposals from MNOs had to include the in-kind/cash contributions the company was willing to make as well as any expected contributions from government or local communities.

The Department of Communications has said before that the government’s $100 million investment is expected to generate at least matching funding from industry, state and local governments and communities.

Three delivery options are being discussed under the program: the first where a single mobile network operator or a consortia of MNOs builds and contributes “significantly’’ to the cost of building base stations; the second where multiple MNOs bid for a portion of the $80 million funding; or the third option where one or more companies build, own and operate a base station or a group of base stations and allow a number of MNOs to install their network equipment.

Labor has criticised the program, claiming that only 1,000 of the 6,000 mobile black spots nominated would be covered by the 250-300 new base stations slated to be built and saying that the greatest need is where there is no incentive for the market to invest.

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One Response to Big three telcos make their call on mobile black spots

  1. Mary Limbers June 30, 2015 at 9:44 am #

    Hi Marie,

    In this article you say that “Telstra, Optus and Vodafone have all nominated locations where they want to build new base stations or upgrade existing ones.” And that “The location of these base stations and the successful contractors will be revealed at the end of June. ”

    Could you tell me if the locations have been announced yet?

    Mary Limbers

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