The great high speed broadband debate

I don’t normal talk politics on this blog, but this time politics is mixing with technology and the internet, so I will make an exception. For those of you outside of Australia or have been ignoring the news for the last couple days, the labour opposition has promised high speed broadband to 98% of all Australians. Note this is not fibre to your home, just fibre to the node (ie your local telephone exchange).

The Government has two problems with the proposal:

  • That infrastructure should be built by private enterprise and
  • that money should not come from the future fund

The Government idea that private enterprise can create a major public telecommunications infrastructure has a couple of problems:

  1. Telstra and the other communications providers have already said, they will not build it without changes to legislation and the Government has said no changes to telecommunications law until 2009 and;
  2. If Telstra builds the network they will want to exclude other carriers from using their network, requiring other service providers to build their own, meaning the cost for two, three or more networks being be passed on to the consumer.

Seriously if the Government gets their way, Australia will end up with a third world communications network not unlike America, with good but relatively expensive service in areas where the companies can make a profit and limited or nonexistent services elsewhere. The advantage of the Labour proposal is one network any service provider can access to provide services to the majority of Australians. It may not be fibre to every home, but it is a start and will allow for the provision of innovate services to almost all Australians.

The idea that money should not come from the future fund is an illogical scare tactic. The future fund was setup when the Government decided it could not sell all their remaining shares in Telstra without damaging the market. So they setup the future fund to cover the expected cost of public employee superannuation, a problem that had been ignore by successive Governments of both persuasions. Unfortunately the future fund is heavily invested in Telstra and nothing else at the moment. It would make financial sense to diversify the future fund investments. Even if the diversification is to invest in a company that builds a national broadband network and makes it’s income from selling access to other telecommunication companies, even if it appears that the new company maybe a competitor to Telstra.

The Government’s response so far has just been illogical, the don’t seem to get the need for a good high speed internet network, unlike the Korean, Singaporean and other Governments. Australia needs a high speed broadband network to be competitive and the Labour proposal of a single network that all service providers can access is the most logical and cost effect solution.

3 Responses to “The great high speed broadband debate”

  1. Ben Buchanan Says:

    Sadly none of it is really surprising given this country’s government’s record with telecommunications, perhaps still not topped by the ongoing black comedy that was Alston (the world’s biggest luddite).

    Still, one has to be impressed at the sheer level of shortsightedness required to think high speed network access has no part to play in the development of a supposedly first-world nation. Why on earth would we want to keep up with a technology that allows fast and easy access to traditional web, media (movies etc) and VOIP.

    After all it’s not like the population is paying high prices for low quality as it is….

  2. Rosemary Says:

    Interesting piece Nick and I now feel a bit more “up to speed” with the various issues. I saw a Telstra flyer about this and was surprised/curios about why Telstra was wanting to garner grass roots support from technically minded folk.

  3. broadbanduser Says:

    The building of the Internet infrastructure have been so far behind other developed countries, it is so amazing. This reminds me of one thing. Why the Liberal government have been so keen to sell Telstra?

    Until now I have not cared about the political rows around the sale of Telstra. Recently, I have noticed that the federal government has been reluctant in pushing broadband. This can be associated with Liberal’s enthusiasm for selling Telstra.

    The Howard government just wants to sell Telstra at higher price, to prove how correct it is and how beneficial it is to sell Telstra.

    Without being pushed by the government and the markets (because of Telstra’s monopoly position), they can expand the present infrastructure slowly hence making their profit figures look more attractive and then the Howard government can sell at a higher price.