Optus puts rural folk in the loop

By PETER GRIFFIN

Australian carrier Optus has begun selling a satellite broadband service that will appeal to rural internet users left out of the broadband loop. But it comes with hefty set-up and data costs.

Optus hopes to repeat the success it has had in remote parts of Australia - where hundreds of schools beyond the reach of the DSL (digital subscriber line) services of Telstra and Optus are receiving distance learning materials via satellite.

Data from New Zealand would be bounced off the satellite to the Optus hub in Sydney and out to the internet from there.

The service allows a download speed of up to 200Kbps (kilobits per second) with an upload speed of 77.6Kbps nationwide.

Most people will require a 1.2m satellite dish to access the service. In hard to reach places a 1.8m dish will be required.

But those wishing to buy their own dish will have to stump up around $8300. A $95 per month download fee would then be charged.

Leasing would cost customers $371 a month for a 36-month contract or $288 a month for 60 months.

All of the plans come with a relatively restrictive download cap of 250MB of data a month. Extra downloads were charged at 18c per megabyte.

Optus' country manager for New Zealand, Tony Hill, said a handful of customers, including a Government department, used the service. Hill put the high cost of the service relative to DSL down to the inherent costs of operating the satellite. The service would not be suitable for supporting VoIP (voice over internet protocol) phone calls.

An option to cut down costs would be for communities or clusters of businesses to share a satellite link, splitting the cost of buying the dish and the monthly data charges.

Optus was keen to facilitate that, but the networking of PCs sharing the one connection would be left up to the customer.

Auckland company Niche Media International has been recruited as a reseller of the service.

Niche would sell the service but it also had a contract with Sky to roll out a number of local TV channels that would soon become available via satellite.

Niche spokesman Nicholas Samitz said the company would start with a channel tailored to the rural community that would be available free to air to Sky subscribers.

Niche offered a "rapid file distribution" service which would simultaneously send copies of files to remote offices throughout New Zealand and Australia.

Hill said Optus was involved in tendering for business as part of the Government's Probe project to get high-speed internet to all schools.

But splitting the tendering by region would not make Optus the most cost-effective option in some areas.

Optus would also struggle to meet the Government's data speed requirements.

"We would love to win all of the schools, but realistically, we are more effective in servicing the last percentage [that is hard to reach]. That would be where we have a distinct advantage."

But Optus was no stranger to providing broadband via satellite to the education sector - and working with the Government to do so.

Across the Tasman, the carrier is using Federal Government finance to provide interactive distance learning services for the schools, reaching 3700 students.

Live video streaming, application sharing, full duplex audio and two-way data transfer was possible via satellite servicing remote areas of the Outback.

Last March, Optus won a A$7 million deal to deliver high-speed internet access via satellite to all public schools in the Northern Territory connecting 4000 computers which are used by 35,000 students.

The Australian schools had aggregated their broadband requirements to secure better rates from Optus.

"In places like the Northern Territory, the schools have bought a chunk of bandwidth between them and they're getting speeds a lot higher than 200kbps as a result," said Hill.

Yet another satellite operator, Thai company Shin Satellite, would look to offer a satellite internet service when it launched its iPSTAR-1 satellite to service the Pacific region in late 2003.

Shin had also expressed fleeting interest in the rural broadband tenders.

Shin consultant John Humphrey said the structure of the tenders did not suit a national satellite service. Timing had also been an issue.

"The first generation gateway installation in Australia has not been finalised yet and we are unable to provide the required pricing for the RFI response in time," he said.

Shin would consider establishing a satellite earth station in New Zealand in preparation for iPSTAR-1's launch.

The gateway would cost around US$2.5 million to build.

Satellite access devices were forecast to cost around US$1000 next year, with prices dropping to US$750 within two years.

Users would have true high-speed internet with a maximum download speed of 8Mbps and an upload speed of up to 4Mbps.