Govt explores $100m mobile network investment

The federal government is canvassing options to invest $100 million augmenting mobile phone networks.

A discussion paper (pdf) issued by the Department of Communications is seeking feedback on three options, including giving all the money to a single operator or consortium, or allowing multiple operators to bid for portions of the money.

The government's proposal includes funds in two tranches — $80 million to improve coverage on major roads and in regional communities, and an additional $20 million for locations considered 'blackspots'.

The department said in order for a single operator to take the full $80 million, it would be required to reveal — in confidence — its rollout plans for the next three years. The Government indicated it would not fund base stations that were already on an operator's three-year roadmap.

Locations put forward for government funding "would need to be in addition to locations already planned to be built in the next three years by the bidder," the discussion paper states.

However, among the department's concerns with a 'winner takes all' approach is that it may not lead to "competitive tension for the available funding".

"We want to drive this money as far as we possibly can, which means maximising competitive tension between bidders," parliamentary secretary to the Minister for Communications, Paul Fletcher, said.

A second option would divide up the $80 million into smaller pockets of work. One of the problems with this approach, according to the Government, is that the federal funding is unlikely to go as far, because smaller pockets of work mean less economies of scale in the build process.

The third option would allow a third party to build a base station network and let mobile telcos to co-locate their own equipment on the towers.

Submissions are being sought until the end of February next year.