Home internet users are set to benefit from a price war as 5G fixed-wireless products go head-to-head with the NBN’s fixed-line offerings.
Telstra on Wednesday launches its $85 per month 5G Home Internet plan, with the company saying it should deliver typical download speeds between 50Mbps and 300Mbps.
The 500GB of data plan is for now only available to a targeted, invitation-only customer base, but Telstra says more consumers will be able to join over the next 12 months as it scales up, especially when mmWave becomes available.
The short-range, high-frequency network technology offers more bandwidth, and licences on the mmWave spectrum will be available to multiple carriers under an auction expected to begin in late March 2021.
Optus is already offering a $75 per month 5G fixed-wireless service with unlimited data, guaranteeing download speeds of at least 50Mbps but claiming an average of 214Mbps.
IBISWorld telecommunications analyst Liam Harrison said consumers would benefit from fierce competition in the space as mobile network operators expanded their 5G fixed-wireless service to capture poor-performing NBN regions.
There was great disparity in NBN quality, which gave telcos a great opportunity in under-serviced suburbs, he said.
“Mobile in general, not just 5G fixed-wireless, is becoming somewhat of a threat,” Mr Harrison told NCA NewsWire.
“Australia is unique in that situation because we have such fantastic mobile internet infrastructure – I think we’re in the top 10 in the world for internet speeds – but we’re very low down for fixed-line internet.
“Part of that is because trying to roll out such an expansive project across such a large landscape is very difficult.”
Mobile data rates and fixed-line data rates were roughly the same, he said, so if NBN Co didn’t take action, 5G could overtake on average speeds and become the more attractive alternative.
It has reliability drawbacks, however, as bad weather can interrupt the radio waves.
“But if it offers reliability, say, for 99.8 per cent of the time versus quite low reliability rates for some NBN connections, for example 95 per cent in some cases … some people will make the switch.
“This is where this war between fibre and 5G is really going to come in: It’s about trying to say ‘not only do we have good speeds, we’re consistent and we’re cheaper’.
“NBN is going to have to move very quickly to cut that off.”
Mr Harrison said 5G fixed-wireless could technically deliver speeds up to 400Mbps while NBN 1000 plans claim speeds of up to 1Gbps in some cases – but they come at a price and not many homes are eligible.
The base price of home internet jumped when ADSL switched to NBN, and 5G fixed-wireless offered the opportunity to bring back cheaper plans for low income earners, he said.
“That low end of the market hasn’t been well taken care of,” Mr Harrison said.
NBN Co last week announced it was bringing forward the next phase of its planned network investment, which Mr Harrison believes is partly in response to the 5G fixed-wireless threat combined with the Federal Government trying to boost economic recovery.
In its 10th Measuring Broadband Australia report released on Tuesday, the Australian Competition and Consumer Commission (ACCC) said fixed-line NBN broadband speeds were broadly maintained in May and June despite unprecedented demand as many schooled and worked at home.
However, NBN Co’s decision to offer their telco customers 40 per cent extra network capacity for free until November 30 had been vital to the sustained performance, ACCC chair Rod Sims said.
Average download speeds had dropped before the move.