SWEDISH network equipment maker Ericsson has bagged a $1.1 billion deal to build and operate the fixed-wireless portion of Labor's National Broadband Network.
The 10-year deal is the largest local contract for Ericsson since 2005, when it built Telstra's Next G mobile network.
Ericsson will supply a range of radio gear to build a Long-Term Evolution-based, fixed-wireless network that will supply broadband services with minimum peak download speeds of 12 megabits per second and upload speeds of 1Mbps to the 4 per cent of the population outside the NBN's 93 per cent fibre footprint.
The remaining 3 per cent of premises will be served by next-generation satellite services.
LTE, the successor to 3G mobile technology, can provide average speeds of 70Mbps and peaks of 150Mbps at the centre of a cell.
However, unlike the fibre build of the NBN, which can deliver committed bandwidth to a household no matter how many customers are using it, LTE and wireless networks must share bandwidth among users, meaning it slows as more people use it.
So-called fixed-wireless networks require antennae to be installed in customers' houses.
To deliver wireless services, NBN Co will use wireless spectrum acquired in early February from regional pay-TV operator Austar for $120 million.
That spectrum will allow NBN Co to service most of the 4 per cent in the fixed-wireless footprint, but additional spectrum will be needed for Western Australia and the Northern Territory.
The network builder expects to begin construction of the wireless portion of the network by the end of this year, with the first commercial services scheduled for delivery by the middle of 2012.
NBN Co will wholesale the wireless service to a range of retail providers.
The project is expected to be completed by 2015, which is the same deadline as the completion of NBN Co's satellite network.
"It's only right that those parts of the country with some of the poorest access to high-speed broadband should be among the first to receive the National Broadband Network, either via satellite or the fixed-wireless solution we are announcing today," NBN Co corporate services head Kevin Brown said.
The agreement requires Ericsson to design, build, operate and maintain NBN Co's network end-to-end, including business support systems. This includes service activation, management and assurance as well as network performance and capacity management.