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Internet in Australia

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Internet access was first available in Australia to universities via AARNet in 1989. The first commercial dial-up ISPs (Internet Service Providers) appeared in capital cities soon after and by the mid-1990s almost the entire country had a wide choice of dial-up Internet access providers. In present times Internet access is available through a range of technologies, chiefly Hybrid Fibre Coaxial Cable, Digital Subscriber Line, ISDN and Satellite Internet. The Australian government, in partnership with industry is planning to roll out a nation-wide Fibre-to-the-Node network.

History of Internet in Australia

Prior to connection to the greater internet, there existed an IP-based network linking academic institutions within Australia known as ACSNet, using the top level domain .oz. When Australia was connected to the internet, this domain was moved under .au to become .oz.au and still exists today.

The first permanent circuit connecting AARNet to ARPANet using Internet Protocol was established in May 1989. It linked the University of Melbourne with the University of Hawaii via a 56K satellite connection. Later upgraded to 256K, at which time the US end-point was moved to San Jose at a NASA facility.

In 1992 there were two commercial ISPs: DIALix providing services to Perth and Pegasus Networks out of Byron Bay, New South Wales. [1] By June 1995 this number had increased to excess of 300, attributing some fifth of all AARNet traffic. At this time, it was decided by the Vice Chancellors Committee that Telstra would be better positioned to lead the commercial push of the Internet into Australia, so all commercial customers were sold.[2]

In the late 1990's, Telstra and Optus both started their own separate roll-out of cable Internet services — this was limited to some areas of Sydney, Melbourne and Brisbane.

In 2000, the first ADSL services were made available via Telstra Bigpond, at speeds of 256 Kb/s/64 Kb/s, 512 Kb/s/128 Kb/s, and 1500/256 Kb/s. Telstra choose to artificially limit all ADSL speeds to a maximum of 1.5 Mbit/s downstream / 256 kbit/s upstream. They also sold slower speeds of 256 kbit/s/64 kbit/s and 512 kbit/s/128 kbit/s (the 512/128 offering is no longer available to new customers through Telstra's own ISP Bigpond, but continues to be offered to the wholesale ISPs who resell the Telstra product). As ADSL required access to the telephone exchange and the copper line — something only Telstra had — this allowed Telstra to be dominant due to the expense of rollout for other companies and Telstra's established customer base.

Resellers appeared soon after; first offering a re-sold Telstra service, then gradually taking over more of the delivery infrastructure themselves by taking advantage of regulated access to the unconditioned local loop. As well as significantly reducing costs, it gave the service providers complete control of their own service networks, other than the copper pair (phone line from the exchange to the customer).[3]

The first competition to Telstra's DSLAMs was provided by then Optus subsidiary XYZed, launching business-grade xDSL services from 50 exchanges in September 2000.[4]

Competition in the residential market began in 2003, when Adelaide-based ISP Internode [5] installed a DSLAM in the town of Meningie, South Australia. Several other service providers have since begun deploying their own DSLAMs. The presence of non-Telstra DSLAMs allowed the service providers to control the speed of connection, and most offered "uncapped" speeds, allowing the customers to connect at whatever speed their copper pair would allow, up to 8 Mbit/s. Ratification of ADSL2 and ADSL2+ increased the maximum to 12 Mbit/s, then 24 Mbit/s.

Competition is having an appreciable effect on Telstra, (who still has over 47% of the ADSL market share) as competitors have made some inroad into the territory of the previously monopolistic corporation. The 12 month period from the end of September 2005 to September 2006 showing a growth of 51 per cent, and "Other DSL" which includes wireless broadband growing 179.5% in the same period.

In late 2006, Telstra uncapped their retail and wholesale ADSL offerings to the full downstream capacity of up to 8Mbps, however with a limited 384kbps upstream. This has allowed many Australians access to high speed broadband, while the low wholesale rates that Telstra impose on ISPs to supply these speeds to end-users discourages competitive investment in infrastructure in most cases.

Wireless broadband in Australia is also thriving, with many point-to-point fixed wireless broadband providers such as Agile Communications and Cirrus Communications serving poorly-served regional and rural areas, predominantly with Motorola Canopy and WiMAX technologies. Telstra's 2006 introduction of the "Next G" HSPA network - which covers 99% of the Australian population (September 2008) with speeds of up to 14Mbps.[6], and stimulated investment in wireless broadband by competitors Optus, Vodafone and Hutchison Telecommunications, who are presently expanding their HSPA networks to cover 96-98% of the Australian population.[7][8][9]

In 2006 the top three ISP's stated that they did not discriminate between peer to peer internet activity and normal internet activity. Though peer to peer activity is counted towards the customers limit and if the customer exceeds that limit then they will have their account shaped. However Unwired and Iburst confirmed at the same time that they do shape peer to peer activity in order to "smooth the flow of data".[10] In 2007 Telstra and Optus change their policy so that uploads as well as downloads would be counted towards the customers limit. This has been seen as a move to curb the amount of peer to peer activity as other services which upload such as multiplayer computer games are not counted towards the limit if played through certain servers.[11]

Delivering competitive telecommunications services to regional and rural areas is a major issue, with Telstra often providing the only telecommunications backhaul transmission infrastructure. The large distance and small population means that ISP must invest large amounts of capital with low returns. Agile Communications is a pioneer of deploying cost-effective, competitive backhaul networks including their own microwave network in rural South Australia.[12] Internode has been active in increasing access in order to be accessible to more people, spending $3.5 Million. This expansion will include both "wireless and fixed line-broadband (ADSL 2+)". [13]

In June 2006, the Australian Department of Communications, Information Technology and the Arts (DCITA) under the then coalition government called for expressions of interest for discussion of how to invest up to A$878 million in funding under Broadband Connect program to provide greater access to broadband services in rural and regional areas at prices comparable to services available in metropolitan areas, $500 million of which was envisaged as being available to infrastructure projects.[14] On 2006-09-21, the government announced they would invest up to $600 million in broadband infrastructure projects in rural, regional and remote Australia under this program. Applications for funding were open until 2006-11-30.[15]

On 2007-06-18, in the lead up to a federal election, OPEL Networks was announced as the sole successful bidder, receiving the entire $600 million in funding under the program, as well as an additional allocation of $358 million. This was to be combined with $917 million to be invested by the OPEL Networks joint venture.[16][17]. The awarding of additional funding was met with some debate.[18]

The funding agreement was signed on 2007-09-09, which was dependent upon further planning by OPEL and confirmation that it would reach the agreed levels of coverage.[19][20]. The then federal opposition Communications spokesman stated that they would honour the agreement, a stance maintained after winning government two months later, despite their own competing National Broadband Network proposal.[21]

We have said all along, will honour existing contracts. There are a number of performance hurdles the OPEL contracts have to meet. That's all part of the contract.

— Stephen Conroy, Minister for Communications, Lateline Business, 2007-12-05

On 2008-04-02, it was announced that the funding agreement had been cancelled.[22]. The minister cited OPEL's failure to meet the terms of the contract[23], a claim refuted by the OPEL joint venture partners, who nevertheless stated that the project would not proceed[24][25].

As of March 2007, there were approximately 4.33 million broadband subscribers in Australia, well-exceeding the 2.09 million narrowband subscribers.[26]

Between December 2007 and June 2008 there has been a 90% increase in the number of wireless internet subscribers increasing from 433,000 to 809,000.[27] Connection speeds on 1.5M/bits have increased from 2.47 million (37% of total) in December 2007 to 3.10 million (43% of total) in June 2008.[27]

In the last federal election Kevin Rudd promised a $4.7 Billion national Broadband network which would give internet access to 99% of Australians. In April expressions of interest in the project where asked for by the government from interested parties however the response from the prospective parties has been hesitant due to the lack of details that have been released with the call for expressions of interest.[28]The government has now released further information on applying to build the broadband network and tenders must be submitted by the cut-off date of 22 August 2008, "or ten working days from tomorrow"(Suzanne Tindal).[29]

Internet Statistics

Broadband Type # Connections
Total Internet Services 7.228 million
Non dial up 5.661 Million 
*DSL : 3.936 million
*Wireless : 809,000
*Other(a) : 916,000
Dial up 1.566 million 
*Analog : 1.551 million
*ISDN/other : 15,000

[27]

(a): ISDN, Cable, Satellite and other non-dial up technology

  • Internet Service Providers (ISPs): 37
    • Very Large: 11
    • Large: 26 (June 2008)[27]
  • Country code: .au
Purpose of Internet Use at Home 06-07 respondants could answer multiple options
Personal/Private 98%
Education/Study 53%
Work/Business 52%
Voluntary/Community 12%
Other 11%

[30]

Internet Access and at use at home by age 06-07

Age group (years) Internet Access Internet Use
15-24 79.7% 76.5%
25-34 75.8% 71.8%
35-44 80.2% 72.6%
45-54 78.5% 66.5%
55-64 64.7% 51.7%
65-74 42.2% 28.1%
75+ 21.8% 10.5%
Total 69.5% 60.9%

[31]

Current state of Internet in Australia

Home broadband Internet access is available in Australia using ADSL, ISDN, Cable, Satellite and Wireless technologies. As of July 2008, almost two thirds of Australian households now have internet access, with broadband connections outnumbering dial-up two to one.[32] According to the recent ABS statistics the Non dial up services outnumber dial up services 3.6 to 1.

In Australia the major telephone company Telstra owns the majority of landline infrastructure, with Optus (a subsidiary of Singapore Telecommunications) owning the rest. Competitors often resell this, and some provide other options — such as their own ADSL networks over Telstra copper wiring with speeds up to 24 Mbit/s, a cable network at 30 Mbit/s, business fibre in city centres, and various wireless choices (these are all predominantly in large cities).

As of November 2006, Telstra's Internet service BigPond is offering ADSL speeds of up to 24 Mbit/s downstream. Most Australian ISPs traffic shape residential customers after a monthly download quota has been exceeded. However, on a global scale, Australian ISPs offer extremely expensive prices per GB and traffic is typically shaped to 64 kbit/s. This is due to Australia's small population, huge size and distance from the USA. Many other ISPs apply "per gigabyte" excess charges to downloads beyond the monthly download quota.[33]

Telstra Wholesale DSL

Telstra is obligated to give discounted price for its wholesale and network access to its competitors in order to prevent Telstra from creating a monopoly due to its control of most of the existing communication infrastructure. The ACCC has also allowed other providers to install some of their own equipment cheaply in Telstra exchanges. In particular, DSLAM's. This has helped lower the price of ADSL 2+ internet for Australians as ISP's must compete (offer lower prices, offer better packages) with each other in order to attract customers.

DSL 2+ network. [34] As a result many Australians, can only get ADSL 2+ connections through Telstra as other ISP's only install equipment in areas that give them a definite return. Telstra ADSL 2+ connections are slightly more expensive than ADSL 1 connections and thus many Australians have stayed with ADSL 1 unless they can get ADSL 2+ through another provider. Telstra wholesales ADSL 2 to other ISP's of it's own accord.. [35]

Faster broadband

Faster broadband speeds are available in Australia. Telstra & Optus both own separate cable networks capable of higher speeds (Telstra 30 Mbit/s, Optus 20 Mbit/s), though the network is limited and covers only parts of a few major cities (these are not sold wholesale). The government has regulated cheap access for competitors to Telstra's exchanges and their copper phone lines (local loop unbundling), and several ISPs have installed their own hardware DSLAMs — and now offer broadband speeds up to 24 Mbit/s.

ISPs who are installing their own DSLAMs include Amcm, iiNet, TPG, Internode, TPG Internet, BigPond, OptusNet, Primus, Netspace, Powertel, Adam Internet & EFTel. Most offer ADSL2+ (with speeds up to 24 Mbit/s), though in 2006 some still provide ADSL1 (with speeds up to 8 Mbit/s). Only Telstra (BigPond), Optus, Primus, & Powertel offer their own standard telephony services over these lines, other ISPs resell Telstra's phone services alongside their own ADSL or do not bundle phone services.

In 2005, Telstra announced it would invest AUD $210 million in upgrading all their ADSL exchanges to support ADSL2+ by mid 2006, though they did not say whether they would continue to restrict access speeds[36]. However, in 2006, they announced new intentions to substantially alter their copper phone network and setup a "Fibre to the Node (FTTN)" network. This was later scrapped, with Telstra citing regulations forcing it to provide cheap wholesale access to its competitors as a reason to discontinue the investment[37].

During the 2007 Australian Federal Election, competing proposals were put forward by both major parties for new broadband networks, including differing FTTN proposals. Following the election, the new government has proceeded towards their proposed model, now known as the National Broadband Network (NBN).[38]

3G/Wireless internet

Three phone networks provide 3G data connectivity: Telstra EVDO via CDMA & HSDPA via 3GSM, and Optus and Vodafone via 3GSM. Optus has experienced increased number of blackouts on their 3G network due to the unprecedented increase in demand due to the quick take up of 3G devices such as the iphone.[39] These problems have made the Federal government put a hold on the handing out of subsidies in order to assess the amount of money that would be expended on a 3G network.[40]

Wireless networks are provided by Unwired, and iBurst in several cities, and Austar has announced wireless plans for regional areas. Internode received state government funding for wireless in rural South Australia in places such as the Yorke Peninsula which have resulted in increases in social and economic living standards.[41] Wireless internet is better suited to the more rural areas of Australia due to the larger distances and lower population density which make traditional lines costly. New business models have been used in order to encourage the take up of wireless internet, prepaid a concept that has been seen in mobile phones is being transferred to wireless internet. The internet user pays either for a set amount of time (hours) or a limit (data-amount) these can be topped up the same as a wireless mobile phone.[42]

Internet in rural areas

Internet in Australia has great differences between urban and rural areas. With the March 2007 announcement of the Broadband Guarantee program, which will replace the Broadband Connect program, many long term projects to bring Internet to Rural Areas are under review. A week after the announcement, Internode suspended its programs to bring Broadband to the Country [43] and many others providers are having to follow suit as the cancellation of the Connect program has removed the financial incentive for ISPs to "supply higher bandwidth services in regional, rural and remote areas of Australia at prices comparable".[44]

Later in the month of March, the ALP announced a new policy, accepting the privatization of Telstra in order to fund a world class national broadband network.[45][46]

See also: Systemic Infrastructure Initiative § Network
See also: Broadband Internet access in Oceania

It should be noted however that due to Telstra's extensive use of Pair Gain technology for connecting home landlines from 1994 to 2000, some homes have been excluded from ADSL and are limited to a dialup speed of 28.8 kbit/s. [47]

Other developments

There are ongoing developments in Australia. This includes fibre networks offered by Telstra and competitors in major cities (eg: east-coast capitals by Powertel, and mid to west-coast capitals by Amcom). The federal government is financially aiding better rural broadband access, including encouraging competition where feasible as these are less profitable areas — with less customers, greater line lengths and a higher ULL wholesale line rental from Telstra, and higher rates from Telstra charges for data connections (backhaul) to the cities.

The future of Internet in Australia

There are several factors driving the growth of the Internet in Australia, not just in number of services but the bandwidth each service is requiring.

The main driving factor is like elsewhere in the world the requirement for self-education and being able to access the content of any subject, essentially following free will.

The next driving factor is the use of the Internet to download content for entertainment — this includes peer-to-peer downloading of music and video. This factor is also driving the bandwidth requirements of customers very strongly which has forced many of the inferior ISPs to introduce shaping of this Traffic due to lack of their own bandwidth and backhaul capacity, or pursuing high data charges.

The growing trend is also on content production, allowing anyone to produce their own video clips and publish online with services such as YouTube.

Another factor is the increased requirement of Video On Demand. VOD is a very heavy bandwidth user; typically, at good compression ratios, a 90-minute transmission requires around a gigabyte of data, with more and more set top boxes based on systems similar to Myth TV it is not unreasonable to expect the bandwidth to grow to an average of 120 gigabytes of data per set top box per month, particularly when the services are available in high definition.

The Main areas preventing Video on Demand have been the high cost of bandwidth and backhaul and of the high cost of licensing, however once any studio opens its library up for a flat monthly fee, this is one area which will quickly come to fruition.

New submarine cables

Both Telstra and PIPE Networks have committed to the construction of new undersea fiber-optic communications cables to Australia in the near future. Between these two an additional 3.2 Terabits(PPC1:1.92TBits, Telstra: 1.28 TBits [48]) of network capacity to the country. With PIPE Networks claiming "50% savings"[49] when compared with existing cables, this could substantially improve the value of internet connections in the nation.

National Broadband Network

The National Broadband Network is a proposed Fibre to the Node (FTTN) and/or Fibre to the Home (FTTH) network in Australia. The Australian Government has called for proposals to build an Open Access Network providing download speeds of 12 Megabits per second or more to at least 98% of Australian homes and businesses, for which it is offering to contribute up to A$4.7 billion, in the form of a public private partnership. It will be the largest single infrastructure investment in Australia's history.[50]

Main article: National Broadband Network (Australia)

IPv6

With the Asia-Pacific Network Information Centre's Geoff Huston stating that IPv4 addresses will be exhausted prior to October 2010[51], IPv6 is becoming increasingly important in the future of Australian Internet connectivity. Despite several companies having applied for allocations of the new addresses[52], presently only two organisations have provided IPv6 offerings to their end-customers, Internode[53] and AARNet[54].

See also: IPv6

References

  1. ^ [1] Origins and Nature of the Internet in Australia - Roger Clarke. Published 29 January 2004
  2. ^ [2] AARNet History
  3. ^ "iinet archives"Retrieved on 25 September 2008.
  4. ^ [3] Press Release — First competitive DSL network opens for business
  5. ^ [4] Details on Internode Coorong Network
  6. ^ "example of Bigpond plan"Retrieved on 25 September 2008.
  7. ^ "Znet Optus storyRetrieved on 25 September 2008.
  8. ^ "Vodafone news.com"Retrieved on 25 September 2008.
  9. ^ "Hutchison Telecommunications news.comRetrieved on 25 September 2008.
  10. ^ "Peer to Peer stances the Australian"Retrieved on 25 September 2008.
  11. ^ "Peer 2 Peer stance the AustralianRetrieved on 25 September 2008.
  12. ^ "Zdnet Agile backhaul changes"Retrieved on 25 September 2008.
  13. ^ "Zdnet Internode"Retrieved on 25 September 2008.
  14. ^ "Broadband Connect: Request For Expression Of Interest" (PDF). Department of Communications, Information Technology and the Arts. June 2006. Retrieved 2007-07-14.
  15. ^ "$600 million Broadband Connect program launched" (Press release). Minister for Communications, Information Technology and the Arts. 2006-09-21. Retrieved 2007-07-14.
  16. ^ "Australia Connected: Fast affordable broadband for all Australians" (Press release). Minister for Communications, Information Technology and the Arts. 2007-06-18. Retrieved 2007-07-14.
  17. ^ "Broadband Access and Choice for rural and regional Australia" (PDF). OPEL / Elders. 2007-06-18. Retrieved 2007-07-14.
  18. ^ Marris, Sid (2007-06-26). "Labor whips up broadband anger". Australian IT. Retrieved 2007-07-14.
  19. ^ "New OPEL Project Underway" (Press release). Minister for Communications, Information Technology and the Arts. 2007-09-09. Retrieved 2008-04-02.
  20. ^ "Optus 50 percent joint venture signs funding agreement with Government for rural and regional Australia broadband network" (PDF) (Press release). SingTel. 2007-09-10. Retrieved 2008-04-02.
  21. ^ Moore, Ali (2007-12-05). "Conroy discusses Australia's digital future". Lateline Business. Australian Broadcasting Corporation. Retrieved 2008-04-02.
  22. ^ "Canned: $1bn rural broadband Opel deal". Dow Jones Newswires with AAP via The Australian. 2008-04-02. Retrieved 2008-04-02.
  23. ^ "OPEL Networks Funding Agreement not to proceed" (Press release). Minister for Broadband, Communications and the Digital Economy. 2008-04-02. Retrieved 2008-04-02.
  24. ^ "Optus responds to Government's termination of OPEL contract" (Press release). Optus. 2008-04-02. Retrieved 2008-04-02.
  25. ^ "Government Advises Termination of OPEL Contract" (Press release). Futuris. 2008-04-02. Retrieved 2008-04-02.
  26. ^ [5] ACMA media release
  27. ^ a b c d "ABS 8153.0"Retrieved on 25 September 2008.
  28. ^ "The Australian national network"Retrieved on 25 September 2008.
  29. ^ "Zdnet national broadband network"Retrieved on 25 September 2008.
  30. ^ http://www.abs.gov.au/Ausstats/abs@.nsf/0/ACC2D18CC958BC7BCA2568A9001393AE?Open
  31. ^ http://www.abs.gov.au/AUSSTATS/abs@.nsf/Lookup/4102.0Chapter10002008
  32. ^ Broadband overtakes dial-up | The Australian
  33. ^ "broadband choice". Whirlpool. Retrieved 2007-10-19.
  34. ^ Telstra 'loses game of chicken' on ADSL2+ rollout: News - Communications - ZDNet Australia
  35. ^ Telstra u-turns on wholesale ADSL2+ exchange bounty: News - Communications - ZDNet Australia
  36. ^ "Telstra confirms ADSL2+ network upgrade". Whirlpool News. 10 March 2005.
  37. ^ "Telstra scraps broadband network plan". Australian Broadcasting Corporation. 7 August 2006.
  38. ^ "Date set for National Broadband Network proposals". The Department of Broadband, Communications and the Digital Economy. 2008-09-03. Retrieved 2008-09-06.
  39. ^ "http://apcmag.com/telstras_new_prepaid_wireless_broadband__be_careful_with_the_topups.htm"Retrieved on 25 September 2008.
  40. ^ "http://www.misaustralia.com/viewer.aspx?EDP://20080924000030345912&section=industry"Retrieved on 25 September 2008.
  41. ^ http://www.news.com.au/adelaidenow/story/0,22606,24387699-2682,00.html
  42. ^ http://apcmag.com/telstras_new_prepaid_wireless_broadband__be_careful_with_the_topups.htm
  43. ^ [6] Internode Announcement of (Temporary) Suspension of Regional Connect program
  44. ^ Broadband Connect - incentive program
  45. ^ Kevin Rudd (21 March 2007). "Building a National Broadband Network". Press Releases, Australian Labor Party. Retrieved 2007-04-24.
  46. ^ Gerard McManus and Ben Packham (22 March 2007). "Rudd's broadband plan". Herald Sun. Retrieved 2007-04-24.
  47. ^ SETEL
  48. ^ [7] Telstra Press Release
  49. ^ ISPs Get Slice of Guam Cable
  50. ^ Egan, Michael (2008-09-05). "A separate company for a broadband network". The Age. Retrieved 2008-09-07. {{cite news}}: Unknown parameter |coauthors= ignored (|author= suggested) (help)
  51. ^ Huston, Geoff. "IPv4 Address Report, daily generated". Retrieved 2008-06-08.
  52. ^ [8] IPv6 DFP visibility in Australia
  53. ^ [9] Internode launches national IPv6 service
  54. ^ [10] IPv6

See also

  • Whirlpool — "Whirlpool.net.au is a fully independent, non-commercial, community website, run by a team of unpaid volunteers, which is devoted to keeping the public informed about the state of broadband in Australia." Australian ADSL news, information, and forums.
  • The Reason Australia Lacks Unlimited Internet Plans — An article discussing the whys and wherefores of Australia's lack of unlimited Internet plans.


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