Broadband policy


There are two alternative policies for broadband internet in Australia.

  1. use government money to build the NBN using fibre to the home; or
  2. restructure Telstra and leave it to the market.

The government’s policy is the first of these. The coalition’s policy is neither. And that is the coalition’s problem.

To simply invest in some fibre backbone and fill some gaps in rural and regional Australia achieves almost nothing. But this seems to be the coalition’s broadband policy. Telstra will still own the copper for ADSL, the main cable network used by Foxtel and the biggest and best 3G mobile network. This means that the ACCC will have to keep regulating Telstra and the problems of the past 20 years of telecommunications will not be addressed.

Under a non-NBN solution, at a minimum, separation of the cable and the copper is needed. This has underpinned broadband competition in the US. Telstra may also be required to divest its mobile business to improve competition between fixed line services and wireless services.

There is still a week and a half before polling day. Perhaps the coalition can add an addendum to their broadband policy to get it back in the ball park.

2 Responses to "Broadband policy"
  1. Stephen – I think it’s worse than you think.
    Building more backhaul will not ‘fill in gaps’ – because Telstra already has lots of fibre all over Australia. The problem is that the fibre is expensive – long runs of under-utilised fibre covering not much population, and no competition. Economic regulation could help with the second problem, but not the first. Duplicating the fibre could also help with the competition problem, but it likewise cannot fix the high cost problem. In fact, it will be worse than regulating because existing infrastructure can easily cope with demand and duplication will be socially wasteful.

  2. First, we all agree need to invest in the Internet. But the problem with Labour’s proposal is that they plan to spend $43 billion on the NBN, but it is not worth $43 billion once its built! It certainly will not result in a $43 billion Techonlogy Effect so why choose this path?
    I just watched Malcolm Turnbull describe the Coalitions policy on Lateline and I think it is much better (forgive me if I take the word of a man who made $100 million off the Internet over yours). What is wrong with investing in fibre as and when needed?
    I can understand fibre to the door in say, apartment buildings. But surely the farmer out in rural Australia does not need much beyond STP or satellite? In any case other countries with much higher broadband penetration (like Japan) seem to be doing just fine with (V)DSL.
    Labour’s NBN is a crock and the lets-filter-the-Internet thing is positively antediluvian.

%d bloggers like this: