Ownership matters on broadband

If the whole debate on broadband teaches us anything it is that ownership and control matter. For Telstra, they own what is still the critical bottleneck in broadband, the link out of the home. Given that, apart from letting Telstra own the rest of the network we need regulation in order to have a hope of diversified ownership.

This issue is not lost on Google who today advocate models giving households the ownership of the link from their home.

This may all sound rather abstract, but a trial experiment in Ottawa, Canada is trying out the consumer-owned model for a downtown neighborhood of about 400 homes. A specialized construction company is already rolling out fiber to every home, and it will recoup its investment from individual homeowners who will pay to own fiber strands outright, as well as to maintain the fiber over time. The fiber terminates at a service provider neutral facility, meaning that any ISP can pay a fee to put its networking equipment there and offer to provide users with Internet access. Notably, the project is entirely privately funded. (Although some schools and government departments are lined up to buy their own strands of fiber, just like homeowners.)

Two years ago I proposed that Australia could have achieved this easily by instead of selling off Telstra, by just handing back the copper-pair into homes back to the people. Post-privatisation that appears not to be a viable option but who knows. In any case, if I wanted to build fibre out of my home and to a node, surely I should be able to do it. This is especially the case after my government spends taxpayer money on a fibre to the node network.

Of course, it is possible that wireless mesh might overcome this bottleneck too. Nicholas Gruen points me to Meraki who is proposing and rolling out just that. However, even doing this requires regulation at the exchange and a meeting with Telstra.

4 thoughts on “Ownership matters on broadband”

  1. Last December I wrote a letter to the Canberra Times advocating this in the context of the government’s difficulty in dealing with Telstra. http://cscoxk.wordpress.com/2007/12/07/letter-to-ct6th-dec-07-broadband-rollout/

    The approach of allowing people to buy back the last mile that they have already paid for would still work today in getting Telstra to start to provide decent broadband that is still not available to many of us. I have had to give up on using the copper to my home even though I know it has been connected to fibre about 200 meters away for the last ten years. Telstra refuses to allow another supplier to use the connection and they will not do it themselves. If I owned the copper then I could theoretically get someone other than Telstra to connect the copper to the fibre which would be an incentive for Telstra to do the same.

    As an aside I now use a broadband wireless service and in my small protest against what I consider to be Telstra exploitation of their position in relation to me, have stopped using any Telstra service for any of my other communications needs even if it costs me more. I have only just realising this when writing this comment. What I have done is a classic example of what happens in real life trading systems where we attempt to punish those we think exploit us even it harms ourselves because transactions have more dimensions than the monetary value. The book Moral Markets is a fascinating read where it explores some of these issues.

    Giving the end consumer control over resources for a service is an example of the idea of “Rewards” where we provide services from the bottom up rather than providing the service from the top down. It is the basis of things I have been suggesting in comments on your blog such as MediSave and Energy Rewards and AussieMac. That is, if we provide choice (with some directional bias) at the transaction level in the provision of community services then other desirable system properties that we desire (such as high speed broadband for least cost, or efficient use of public funds for health car, or a solution to the housing inflation problem) will emerge as a result of directional bias. We can implement bias by putting information onto money or tagging money we use to conduct transactions.


  2. Stewart (Stuart?) Fist, who used to write (or still does? I don’t read it any more) in the IT section of tuesdays Oz, argued for years that the copper from the home to the exchange should have been sold to home-owners, instead of privatising Telstra…


  3. To use Meraki in Australia (as a home user and there are quite a few of us) you shouldn’t need regulation at the exchange and a meeting with Telstra. The mini has C-Tick approval and the ACMA management approach for 2.4 GHz relies on the ‘public park’ concept that applies to standard wireless access points.

    Agreed, if 802.11s was to take off here we may be able to side step the Telstra monopoly causing the ‘critical bottleneck in broadband’.



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