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Australia’s high-speed future: Where 49Mbps is all you need

In 2026, the Australian government says we'll only need broadband speeds of 49Mbps. Over in New Zealand, they're clocking 20 times that speed in 2018.

A tangled network cord plugged into a laptop

By 2026, the world will be generating more than 160 trillion gigabytes of data. We'll be connecting cars and robot surgeons, sending a million minutes of video across the internet every second and using 25 billion internet-connected devices around the globe.

But in 2026, Australia will apparently only need broadband speeds of 49Mbps.

That's the assessment of a new report released by the Department of Communications on Australia's future internet needs, which looked at expected bandwidth demand eight years from now.

The issue of speed and bandwidth has been at the heart of the NBN debate. While the broadband network was initially slated to connect the majority of Australians with high-speed fibre to the premises, the coalition government switched to a "multi-technology mix" in 2014 to complete the network sooner. Although the inclusion of copper (fibre to the node) and HFC technologies was designed to reduce costs, it also had an impact on speeds.

But with the release of the "Future Trends in Bandwidth Demand" report, the government insists Australians will be "well served" by its current NBN rollout.

According to the report, "peak bandwidth demand" in Australia is forecast to reach between 20 to 49Mbps in 2026.

The report clarifies that 98 percent of households will actually demand less than 49Mbps, and only 2 percent of households will demand more.

According to a spokesperson from the Bureau of Communications and the Arts Research (the Department group responsible for compiling the report), the figures factor in changes in household types and developments in technology expected over the coming eight years, as well as "the physical limits on the number of devices that a household can use at any one time."

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The need for speed

But the figure of 49Mbps has industry leaders puzzled, with one academic saying the report has "vastly underestimated" the needs of future Australians.

According to University of Melbourne laureate professor and director of the Institute for a Broadband-Enabled Society, Rod Tucker, 100Mbps is the figure we should be looking at for 2026. At the minimum.

"Many people, especially the government, underestimate the need for speed and the fact that the requirements for speed will increase over time," Tucker told CNET. "Many people would argue that we need 100Mbps now."

Tucker pointed to research from 2014 out of the Eindhoven University of Technology (TUE), showing demand was "expected to grow exponentially" in the lead up to 2020. The report found that by the end of the decade, internet users in Western Europe will require an average of 165Mbps.

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That's a figure more than three times the Australian prediction, and it comes six years earlier.

Power users, defined as the top 2 percent of the population in the TUE report, are expected to demand gigabit speeds (1,100Mbps).

Those gigabit speeds are already being experienced across the ditch by Australia's friendliest competitor, New Zealand.

Auckland-based Vaughan Baker, group director of government and corporate relations at MyRepublic, says the demand for speed is already high for many internet users, and it's only growing.

"Here in New Zealand, in some regions, we've got all our customers on gig connections," he said.

In New Zealand, Chorus is the telco responsible for building the bulk of New Zealand's Ultra Fast Broadband network (similar to our NBN Co). According to figures from June 2017, 69 percent of Chorus customers using fibre were on plans of 100Mbps or higher.

"People may say New Zealand doesn't need that speed, but what will bear out is whether New Zealand will benefit from it," said Baker. "[Australia] can't just wait and see what New Zealand goes and achieves with it."

So what about Australia? Is 49Mbps really going to cut it in eight years time?

"In 2026 we're going to live in automated homes... We're not going to configure our devices in such a way that they're going to take advantage of our slow-speed internet. They're just going to do what they want to do, when they want to do it," Baker said.

"The conversation should be around what experience I want, rather than looking at all your devices, adding up the bandwidth and thinking, 'This is all I need'," he said.

The magic number

Baker and Tucker are not alone in questioning the Department of Communications report. Industry sources we spoke to say the figure is low. So why are we expecting Australians to use what would pass for a midrange speed in many countries, eight years into the future?

Some say it could be a matter of politics.

Late last year, NBN Co cut the wholesale price of its 50Mbps speed tier by 27 percent to encourage more Australians to take up higher speeds (more than 80 percent of the market is currently buying plans of 25Mbps or less, according to NBN's 2017 annual report).

But MyRepublic criticised the move at the time, saying the 50 tier was being sold as the "hero" speed, "only because the majority of the network can get 50Mbps." That's because the government's move to a multi-technology mix for the NBN means 100Mbps speeds are out of reach for many.

A number of telcos have already been slammed by the ACCC for selling high-speed plans to customer on FTTN technology (for example, the "technical limitations" of FTTN copper meant 21 percent of Optus customers couldn't even get 50Mbps download speeds).

Now, industry figures are questioning whether Australians of the future will only need 49Mbps, because that's all our network will be able to provide.

"49Mbps?" Tucker said over the phone from Melbourne. "Is that because it's less than 50?"

NBN Co declined to comment.

First published Feb. 28, 5:00 p.m. AEDT.

Update, Mar. 1 at 10:50 a.m.: Adds comment from the Bureau of Communications and the Arts Research.

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