Telstra has thrown down the gauntlet on 5G – and NBN Co has picked it up. After months of foreshadowing a move into fixed wireless, the big operator unveiled its first 5G home service three months ago, promising to progressively expand its availability.

With downlink speeds of between 50Mbps and 300Mbps at around A$85 ($65.60), it's highly competitive against the copper-centric NBN (see Telstra launches 5G fixed wireless).

Now it's signaled it will double down. Regulator ACMA will hold its first mmWave auction in April, allowing each bidder to acquire up to 1GHz of the 26GHz band.

Nikos Katinakis, Telstra's head of networks and IT, said the operator plans to bid for the full 1GHz. "That amount of spectrum is huge compared to what we have today," he told the Australian Financial Review. "From our thinking, it should be important that we maximize the utilization of that spectrum. With so much spectrum and the 5G capabilities, we are going to deploy the network that allows us to truly use all of it."

High society

What's driving Telstra is not, as you might think, Australia's vast, lightly populated spaces, but its unique broadband economics. Telstra and its rival retail operators have long been bristling at NBN's high wholesale prices.

For NBN Co and its owner, the national government, these are essential to pay for the A$51 billion cost of the network, which has just been completed, roughly four years behind schedule. For operators the margins are awfully thin.

"Telstra is perhaps suffering the most as they have the largest residential market share of NBN customers and the margin on the NBN service is extremely low. But equally, everybody else in the industry is suffering as well," wrote analyst Paul Budde.

5G promises a better performance than the xDSL NBN and a better return. Telstra chairman John Mullen has said as much as 30% of NBN's customer base is vulnerable to 5G. Katinakis said Telstra would target areas where the NBN network "does not provide what the customer wants."

Bad connection

There are a few of those.

NBN promises a minimum 25 Mbps download, but it acknowledges that 238,000 homes don't receive that. Then there' another 35,000 homes that for one reason or another can't get connected at all. In response, it is planning some network investment of its own. In September it announced a A$3.5 billion ($2.5 billion) fiber expansion, promising to triple the number of FTTH premises to around 6 million. (See After seven years of copper, Australian NBN pivots to fiber).

Want to know more about 5G? Check out our dedicated 5G content channel here on
Light Reading.

That will take time and will still leave a chunk of the market on the basic NBN.

Last week, NBN Co announced it had achieved a world record for "long-range 5G transmission using mmWave." It says it reached nearly 1Gbps over 7.3km, double the distance recorded three months ago.

That looks like a message meant for Telstra – it's not the only one thinking about mmWave 5G.

Related posts:

— Robert Clark, contributing editor, special to Light Reading