NBN: The Politics of Broadband

The 2013 election, be it early (before 30-June), or in August/November, is going to be the third election  on the trot where Broadband will be a major issue.

Peter Reith, in his Report to the Liberals on the 2010 Federal election, says

 Labor’s only real policy advantage was on the NBN.

Will the Coalition go to the 2013 election with a single new Broadband policy, or like 2010, just tweak the last one insignificantly: 2010 Libs Policy?

Computerworld, for the 2010 election, provided a very good comparison of the three major Party policies. The areas covered were:

• Fast broadband infrastructure
• Internet filtering
• Telecommunications reform
• Distribution of IT responsibilities
• E-health
• Government 2.0
• ICT innovation and industry advocacy
• Computers in schools

Far too often in that piece, the Coalition had no Policy position.

These were the 2010 Coalition Policy points:

1. Establish a National Broadband Commission
2. Prepare a National Broadband Database
3. Establish a Fixed Broadband Optimisation Programme
4. Commit up to $2 billion of Funding for New Fixed Wireless Broadband Networks
5. Fund new satellite services for the remaining three percent of the population not covered by other technology
6. Break the backhaul bottleneck by establishing a new national fibre optic network to deliver competitive ‘backhaul’
7. Implement Pricing and other regulation to support competition and Broadband
8. Provide a way forward to a higher bandwidth, more fibre-intensive Australia
9. Conduct a major review of the Universal Service Obligation
10. Review greenfields estates
11. Support consumers
12. Maintain Do Not Call Register but oppose extending it to business phone numbers
13. Target mobile phone coverage blackspots

The ABC summarised the Policy was for $6.3B spending:

• 97% of homes would have access to networks (Fixed Wireless being the fallback) which would deliver broadband at speeds of between 12 Mega bits per second (Mbps) and 100Mbps by 2016 through a combination of technologies.
• 3% remaining homes covered by Satellite.
• $6.3b of investment to get a private sector network up and running speeds of between 12Mbps and 100Mbps
• another $2.75b to extend the fibre-optic network
• $750m to improve DSL services
• $2b for improved rural regional and metropolitan wireless networks

Starting from this position, how will Mr Turnbull achieve his Policy tag-line: "Better Broadband: Cheaper, Sooner, More Affordably"?

Which I regard as code for:

• "Cut the waste"
• Extend the life of existing technologies as long as possible
• Reuse as many technologies as are available
• Push the limits and lifetime of the Copper Customer Access Network as far as possible.
• Monopolies Are Bad:
• Competition is the only way to achieve good infrastructure services
• at best possible quality/speed/range and
• at best possible prices
• The Coalition have decided NBN Co must be a monopoly because:
• they've defined Points of Interchange and Technical Standards of Interconnect and
• Legislation, whilst allowing competitors, requires they offer "Open Access" to all Retail Service Providers on the same basis as NBN Co: at PoI's, Layer 2 'bitstream'.
• I'm uncertain if NBN Co pricing is an upper ceiling for competitors.
• The NBN Co fibre connection fee, as "provider of last resort" is (apparently) $800/premise versus $1500/premise for commercial installers.
• Only Private Sector Businesses can be "Efficient"
• All Government Businesses are seemingly deemed to be inefficient by the Coalition.
• Only "The Free Market" is capable of providing Telecommunications services.

Of the 2010 Policies, what will be left after NBN Co has finished deployment of 12Mbps Satellite and Fixed Wireless in mid-2013?

1. Establish a National Broadband Commission (questionable)
2. Prepare a National Broadband Database  (questionable)
3. Establish a Fixed Broadband Optimisation Programme (questionable)
4. Commit up to $2 billion of Funding for New Fixed Wireless Broadband Networks
5. Fund new satellite services for the remaining three percent of the population not covered by other technology
6. Break the backhaul bottleneck by establishing a new national fibre optic network to deliver competitive ‘backhaul’
7. Implement Pricing and other regulation to support competition and Broadband  (questionable)
8. Provide a way forward to a higher bandwidth, more fibre-intensive Australia
9. Conduct a major review of the Universal Service Obligation  (questionable)
10. Review greenfields estates  (questionable)
11. Support consumers  (questionable)
12. Maintain Do Not Call Register but oppose extending it to business phone numbers  (questionable)
13. Target mobile phone coverage blackspots (maybe, considering the Telstra 4G rollout)

Or from the ABC Summary:

• 97% of homes would have access to networks (Fixed Wireless being the fallback) which would deliver broadband at speeds of between 12 Mega bits per second (Mbps) and 100Mbps by 2016 through a combination of technologies.
• 3% remaining homes covered by Satellite.
• $6.3b of investment to get a private sector network up and running speeds of between 12Mbps and 100Mbps
• another $2.75b to extend the fibre-optic network
• $750m to improve DSL services
• $2b for improved rural regional and metropolitan wireless networks

If voters didn't like the 2010 Coalition offer of "let's throw some money at the Private Sector to upgrade DSL, Mobile and extend Data-over-Mobile" I can't see why they'd like it even as much when the NBN roll-out is moving into high-gear.

Especially, the Coalition is ideologically committed to selling NBN Co into private hands as soon as it can - well before it has completed its network, established itself in the market, ensured the completion of the Telstra Structural Separation Undertaking (SSU) and, most importantly, denying access to Federal Government borrowing and significantly increasing the demanded return (3.5% above the RBA reference rate: approx 7%p.a.).

None of which makes good business sense: it seems you can't define a better strategy to destroy value of NBN Co and its network and to undermine its economics and abort the Telstra SSU.