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July 12, 2006

Broadband bluff?

If we catch Stephen Bartholomeusz' drift, the alternative Fibre To The Node network proposed by the G9 is actually a telecommunications industry version of a straw man, and there's no chance whatsoever that it will ever be built.

The real point of SpeedReach, one suspects, is to influence the discussions the Australian Competition and Consumer Commission is having with Telstra over the FTTN network and the terms on which competitors would gain access to it. And to lay the groundwork for a challenge to the Australian Competition Tribunal if the ACCC signs off on an access regime and clears the way for the network to be built.
And according to telco analysts, the proposal doesn't make economic sense. Fascinating stuff. We can't wait for the next betting round to see who folds, and who ups the ante.

Posted by cw at July 12, 2006 12:15 PM

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Comments

I am sure it was on the Midday TV ABC news a few weeks ago, where Colin Goodwin from Ericsson Australia stated that what we need is 100MB Symmetrical to the home.

Then I am sure later the same day in the car a person from the AFR was quoted as saying the Telstra proposal would be great for the country.

Some commentators in the media regarding telecommunications can really make you wonder sometimes...

I want to hear MUCH more from people like Colin Goodwin at Ericsson and people who know what they are talking about.

Now if the ABC web site search actually worked I could find links to these stories...

If you happened to catch Inside Business on the 25th of June Alan Kohler talked to three senior executives at Telstra - David Moffatt, Justin Milne and Bruce Akehurst. Transcripts and the video are available here.

Posted by: Stephen [TypeKey Profile Page] at July 12, 2006 03:55 PM

Posted by: Ablaze [TypeKey Profile Page] at July 13, 2006 08:50 PM

Yes Ablaze, Ken gets it right again. A clear case of market failure and business politics that will cost the economy dear.

However there is no hope of this government abandoning its simplisitic but highly ideological committment to "competition" and "private" enterprise. Besides, it has too many friends who will urge it not to.

Given the position of state ALP governments on similar issues, and their own obsession with an empty debt sheet provided by the public private partnerships that deliver this ideological fig leaf of fiscal rectitude, the opposition offers no alternative. They too seem likely to continue this notion of public policy being about providing big profits to merchant bankers and finance brokers and any other corporation who can get a hold of the public teat. Yet the Federal Labor party does have some IT policy wonks, it would be good to hear from them.

This especially at a time when the Communications Minister can enact a bill to concentrate media ownership, simulataneously protect the free to air barons from competition, and claim she is actually doing the opposite and "freeing up" the media. Talk about believing six impossible things before breakfast...

Posted by: tflip at July 13, 2006 09:34 PM

i read your column in the green guide regularly and can't seem to find it in the age online does it still exist online? ie especially your most recent article 'nowhere to ride' I find this quite alarming!!! to say the least as I run my own small business and use a laptop dedicated to only do my online banking. Where can I purchase this object to make my transactions more secure or should I rely on phone banking instead? or is even this insecure? I'm not sure if this is the right forum for this?

Posted by: Bob Cvetkovic at July 13, 2006 09:58 PM

From ABC Inside Business Sunday 16th July

Alan Kohler: Just a question on Telstra, there's been the proposal from what's called the G9, the other telco companies for fibre to the node or somesort of fibre network, would you support and help pay for using the funds that have been set aside in the Budget for a fibre network that isn't owned by telstra?

Helen Coonan: Well my understanding is that the proposals that have been discussed with me were predicated on Telstra also participating. That could of course change and as you know I have put out a document calling for expressions of interest for innovative ways to access the $1.1 billion in total money that is available to ensure that Australia has first class broadband and other services in areas where there are difficulties delivering market outcomes. So I want to see what happens out of this expressions of interest process and then I'll be able to form a view about what will be the best way to design the grants process for this money.

Alan Kohler: Yes but would you allow some of that money to go to competitors to Telstra, infrastructure competitors to Telstra?

Helen Coonan: Well I think you would have to see the conditions under which it was proposed to be perfectly fair, conceptually, I'm very interested in competition in telecommunications and part of delivering competition in telecommunications means that you have to keep an open mind if other companies want to talk to you about infrastructure, but rather than make a commitment about that I would like to see precisely how it is proposed this would be rolled out and what point there would be to spending taxpayers moneys, money to assist the rollout.

Posted by: Stephen [TypeKey Profile Page] at July 17, 2006 02:08 AM

Thanks for the quote Stephen
translation into actual English of Coonan quote would read as follows

"I've absolutely no idea what you are talking about but I will stay on message about private enterprise and competition but of course I won't rule out giving taxpayers money to private enterprise."

sub-conscious subtext - I hope this gets me through, I do believe in private enterprise as the answer to everything, I really do. I'm glad I can see the world through such a simplifying lens and be rewarded for it. Thank god there's no competition in policy for my area.

Posted by: tflip at July 17, 2006 05:37 PM

Well, I've now read the G9 proposal, the Government's Broadband Strategy document of 2004 AND their action plan.

What a load of waffle.

So far as FTTN goes in general (what Telstra and the G9 are discussing), I believe that the wrong goal is being focused on. Broadly, FTTN is focused on pushing out the exchange closer to the home - essentially bringing as many people as reasonable to within 1.5kms of an exchange.

This is not necessarily the right objective.

The Government's strategy document makes an interesting statement around defining broadband in terms of what needs to be done with it, not its speed. I partially support this approach however I truly wish they had been a little more definite and associated speed with some real world consumer applications.

IMHO 10mbps is the base line. Why? Because HDTV can be transmitted using compression over 10mbps. Am I being simplistic? Perhaps, but at least I'm putting a stake in the ground and defining an appealing application. Additionally 10mbps is a whole lot more than power users of consumer broadband are getting now (generally 1.5mbps). Thus most broadband needs should be satisfied with 10mbps.

Unless there is some definition given to the word, "Broadband" then we'll go round in circles. If our government decided on a guaranteed baseline download speed then we can then start thinking of ways to achieve such a goal. They'd be a real goal to aim for.

Defining a broadband speed would most likely result in FTTN being discussed for situations where we want to bring exchanges closer to the home so that ASDL2+, VDSL etc. can be delivered. Having a discussion on FTTN alone is not going to achieve what I think are the government's real objectives: broadband for all Australians.

So c'mon Government, let's be brave and declare that 10mbps defines broadband. We'll then start making some real headway.

Posted by: Christopher Hunt at July 21, 2006 04:25 PM

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