Paul Fletcher on ABC Radio National Bush Telegraph, 7 October 2014

HOST:

Poor or no mobile reception. It’s one of the biggest gripes for many people in rural and remote Australia. For some, it even rates above bad internet services or poor roads as their biggest frustration. Well today the federal Government is revealing some details of a $100 million program that hopes to improve mobile phone coverage in some parts of rural and remote Australia. Parliamentary Secretary to the Communications Minister, Paul Fletcher, has more detail and joins the program now. Thanks so much for coming in, appreciate it.

PAUL FLETCHER:

A pleasure, Cameron.

HOST:

What’s the update? What are you actually announcing today?

PAUL FLETCHER:

Today we are releasing a database of the nominations of locations that Australians have put forward where they say that there is inadequate mobile coverage. So the way this program works is, we asked Australians to come forward with locations that don’t have adequate mobile coverage, and the mobile phone carriers – Telstra, Optus, Vodafone – will be asked to draw on that list in putting forward their proposals as to base stations they would build and that they would seek funding for under this $100 million Abbott Government program to improve mobile coverage in regional and remote Australia. So what’s happened is that this database has been built up based upon the locations that have been nominated by Australians. About 6,000 locations all around the country have been nominated as ones which Australians are saying do not have adequate mobile coverage, and they’re proposing should be considered as part of this program.

HOST:

So there’s 6,000 locations that are nominated. Can you give me a feel or a sense of how many of them are rural and remote versus outer metropolitan? Because both groups, or all three categories, are lumped in in this announcement.

PAUL FLETCHER:

Look, that’s right, and there’s a pretty good spread, and in fact it’s sometimes difficult to draw an exact dividing line between outer metropolitan, regional and remote. Let me give you an example. Putty Rd, for example, which runs north from Sydney, is effectively an alternative route north to the Hawkesbury. Now that starts in a metropolitan area, but very quickly becomes quite isolated, runs between national parks. And so it’s hard to draw an exact dividing line between outer metro, regional and remote. There’s certainly heavy representation of regional and remote locations in the database.

HOST:

So based on the process, if a carrier – your Telstras or Optuses of the world – if they don’t put forward their wish to build a station, that eliminates an area straight away, does it – you won’t proceed; they’re out of the picture?

PAUL FLETCHER:

That’s right, and the reason for that is we’re expecting the carriers to come forward with funding as well. So the $100 million will go a significant way, but we also expect to leverage about another $100 million from the carriers, and from potentially other sources including state governments and local councils. And so therefore it is important that the carriers have some involvement in the choice of location, but we did want to make sure that we started with a database of locations nominated by Australians, and that’s what the carriers have to choose from. We didn’t want to go first straight off the bat to the carriers and say, ‘You tell us.’ We wanted to go to the community first and say, ‘You tell us the locations which you think don’t have coverage.’ That becomes the starting point that we then take to the carriers.

HOST:

Would it be fair to assume that the carriers are going to look at those areas are going to look at those areas that have some commercial benefit to them, and they’re more likely to, say, bid or tender for a station in a coastal town with a lot of traffic than, say, somewhere along the Oodnadatta Track or Birdsville Track that services a handful of cattle stations?

PAUL FLETCHER:

To some extent, but the key point is that the carriers will put up their list, and then the government will choose which sites get funded.

HOST:

Yes, but if they don’t put those up on the list to begin with then that’s the end of the story for those phone areas?

PAUL FLETCHER:

That’s true, but bear in mind there’s competition here. There’s competition in two ways: competition between the sites, but also competition between the carriers. So the carriers might put up a list which looks great from their point of view but they can’t be sure what the other carriers are going to do. So the intention here is to bring, to have some competition operating. Now it is important that the sites are ones which the carriers are prepared to keep operating on an ongoing basis because there won’t be an ongoing subsidy. It’s also important to make the point that the carriers are spending substantial amounts of money each year already upgrading their networks – Telstra over one billion dollars. But this is about sites that would not be commercial without the subsidy the government’s putting in becoming ones that are viable for the carriers to propose.

HOST:

So from a government point of view, do you look at this and say there’s a minimum amount of mobile traffic that is needed to justify the public money, the subsidy?

PAUL FLETCHER:

We effectively say this is an issue that the carriers are best placed to judge. They’ve got the expertise in which locations deliver traffic. What we want to do is have a competitive process that is informed by the nominations that the community has put forward to say, these are locations which are important, where there’s a need for coverage, where the carriers are not planning to go anytime soon under their own steam, but if there’s a public subsidy here, then these locations – some 250 to 300 locations around Australia, we estimate – will have a base station operational a lot sooner than if it was just left to the ordinary course.

HOST:

If I can just take an example from the submissions, and there’s a lot of them. I was interested in the Isolated Children’s Parents’ Association in Queensland, that suggested that new mobile phone services, there should be a priority given to communities where schools have no other access to reasonable internet speeds. So they’re saying we need the mobile coverage for the public need of educating the kids. Is there any way that that can be made a priority under this program?

PAUL FLETCHER:

Certainly there’s a whole lot of factors that we need to weigh up in determining where to spend this money to get the maximum positive impact. Now I’ve talked about things like number of kilometres of road that would get coverage that don’t presently have it, number of premises that will get coverage. The specific factor you’ve mentioned is not one that’s included in the guidelines, although I’m confident that there will certainly be instances of schools that get coverage that don’t have it today. I mean, to give you a couple of examples – and I’m certainly not saying that these ones are necessarily going to get funding, but just to mention ones that I’ve been to – a school at a place called Clarke Creek, which is about an hour north of Rockhampton. It’s the centre of the local community, and there’s been a lot of community activism there about could we get a mobile phone base station here, and indeed they’ve succeeded in securing a commitment for 100,000 dollars from a local mining company and that’ll all be sort of put into the mix. It will then be up to the carriers to decide whether that’s a location where they’ll want to build at, or for example –

HOST:

 – so what,  the carrier looks at the other sources of revenue or the other, the in-kind support or the other financial contributions the community may have sourced.

PAUL FLETCHER:

That’s exactly right. So one of the things we’ve done is we’ve gone to around five hundred councils, we’ve written to the five hundred councils covering the areas that are eligible under this program and said to them, do you have resources that you are able to put in, and in a handful of cases councils are in a position to put in some quite significant cash, and in a larger number of cases they’re willing to offer in kind assistance such as, for example, bulldozing an access road or doing some earthworks towards that. There are a number of instances around the country, not massive, but certainly a number, where a mining company or another local business has an appetite to potentially contribute because of course a base station, once it’s there will provide benefit to different groups of people. A mining company might well say, as one or two have said, if there’s a base station on this road which leads to our mine, that’s a safety benefit for our employees on the way to work for example.

HOST:

Would it be fair to say that the most remote, the most remote Australians, cattle stations is [sic] the most obvious example that have blackspots around the paddock, they’re probably not going to be the ones that benefit from this program. It’s more likely to be your regional towns, your communities, your outer metropolitan areas?

PAUL FLETCHER:

Look I think it’s a bit early to say. It’ll depend on the outcomes of the competitive process, but what we’ve sought to do in the way that we’ve developed the guidelines for this program, is use effectively a points scheme to weigh up different factors as we assess the location of a proposed base station. Those factors as I mentioned will include things like number of premises that will get covered. Now that will tend to favour less remote, more densely populated areas, bearing in mind the threshold is it has to be an area that doesn’t have coverage now, so we’re not talking about terribly densely populated areas. But then, the next thing is number of kilometres of road. So, a remote area, particularly as you get west of the divide which tends to be flatter, a remote area is more likely to be in a situation where you’ve got 50 or 80 kilometres or 100 kilometres of road that has no coverage at all and therefore if you stick a base station in the middle of that you could get quite a lot of coverage. There will certainly be instances where in terms of the amount of traffic on a road that is of interest to the carriers. So it is actually quite difficult to say upfront, which is why we’re going through this process. We’re saying okay, these are the factors that we’ll weigh up. This is the amount of money the Commonwealth is putting on the table. This is the list of locations that Australians have nominated saying we don’t have adequate coverage. And then we’re saying to the carriers, okay here it all is and by the way, here’s a list of local councils who’ve said they’ll provide some assistance in terms of some earthmoving and in few cases some cash. We’ve said to the carriers, okay, now come forward, give us your list of locations. You tell us the dollars you need from the Commonwealth for each location. On the basis of that, we’ll then make the choice of the ones that deliver the best value for money for taxpayers and deliver the best outcome in terms of additional coverage provided.

HOST:

Will there be any imperative for, say Telstra builds, wins the tender, and builds a base station, will they have to provide access to your Vodafones and Optuses as well?

PAUL FLETCHER:

That’s an excellent question because one of the things we want to do is use this public money to stimulate competition. So the answer to that is yes. If a particular carrier wins the funding for a base station it will then need to go to the other two and say are you interested in being on this base station. If they say yes it needs to work with them on the design of the tower, because it’s a lot cheaper to design a tower upfront for what’s called ‘colocation’ rather than designing it to meet the needs of one first then trying to fit the other two in later. Additionally, the rules of the program will say, if you get the funding for the base station then the pricing that you charge to the other two for access to that base station must reflect the value of the public subsidy you’ve received.

HOST:

Okay, so when is it likely that the community will actually see a list of areas that will get better mobile coverage than they have now?

PAUL FLETCHER:

The timeframe we’re working to is, as I say, within a matter of weeks the competitive selection process will be underway. That’ll go on for some period of time. The intention is that during the first half of 2015, we’ll be in a position to announce the base stations, the locations of the base stations which are going to receive funding. The intention is that the first of those will start to roll out in the second half of 2015 and the rollout will continue over about a three year period.

HOST:

Well it’s an issue that a lot of rural and remote Australians are taking great interest in. Paul Fletcher, thanks for coming in today and explaining what’s happening.

PAUL FLETCHER:

No worries, that’s alright.

HOST:

Parliamentary Secretary to the Communications Minister, Paul Fletcher, you’re listening to Bush Telegraph, you’re on RN.

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