Launceston is Australia's first city with gigabit NBN

Tasmanian telco Launtel is calling Launceston "Australia's first gigabit city", following its launch of gigabit National Broadband Network services for businesses in the area. Using NBN's fibre-to-the-premises technology, Launtel says it's able to deliver 1Gbps speeds - ten times as fast as the top NBN connection commonly available - to 100% of business premises in the city for approximately $1,000 per month.

"With speeds that match the world’s fastest countries such as Singapore, Hong Kong and Japan, Launceston businesses can expand by trading with the world," said Launtel CEO Damian Ivereigh.

"Fast communications will facilitate business with any of the developed countries, without having to leave home. For instance, gigabit speeds will allow a local business to control robots overseas through virtual reality."

While $1,000 per month isn't cheap, it's still potentially more affordable than the cost of a fibre connection in a city such as Sydney or Melbourne. 

Fibre-to-the-premise is currently the only NBN technology capable of delivering gigabit speeds, though future upgrades to the underlying tech may allow HFC and fibre-to-the-curb (also known as fibre-to-the-distribution-point) connections to get close.

What about the rest of us? 

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Earlier this year, NBN CEO Bill Morrow came under fire for claiming Australians wouldn't use gigabit speeds even if they were offered to them. Following a bit of a beat up, he clarified that over 1.5 million premises could connect at gigabit speeds, but that no retail internet service provider had chosen to sell these.

"This is, in our opinion, because there is still minimal consumer demand for these ultra-fast speeds – especially at the prices retailers would have to charge for them," said Morrow on NBN's blog.

"Our own data shows that 83 per cent of people on services powered by the NBN network today are ordering retail services based on the two lowest wholesale speed tiers 25/5Mbps and 12/1Mbps."

Morrow suggested that the small demand for such services comes down to cost: given Australia's geography and population density, the company can't deliver gigabit fibre connections for the same kind of price as in city states such as Singapore, where such a service can be had for as little as $49 per month.

Boutique telcos such as SkyMesh have started going past the typical 100Mbps speeds commonly offered by Australia's major NBN providers, and are now offering NBN connections with download speeds as fast as 200Mbps. These are however only available to buildings with a fibre-to-the-premise connection, and can cost upward of $300 per month.

In addition to the costs internet service providers have to pay NBN for access to and capacity on the network, they also need to ensure they have sufficient backhaul - connectivity to the rest of the internet - to ensure consistently high speeds. The high cost associated with top tier NBN connections is a result of these three factors.

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Read more about fast NBN plans here