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April 8, 2009
Surprise surprise. The Rudd Government has decided to scrap its previous plans for a high-speed national broadband fibre-to-the-node network funded by the private sector with the government tipping in $4.6billion and gone for a fibre-to-the-home network costing $43billion.The Government will set up a company in which it will hold a 51 per cent stake and will invite the private sector to invest in the remainder. It's a nation building project
Since the proposed new network will be a wholesale product open to all telecommunications carriers and so provides a solution to the problem created by the Keating and Howard governments when Telstra was privatised a decade ago when it was still holding a monopoly on network infrastructure and dominating the retail market.That was the big mistake.
The solution means that there is no need to compensate Telstra since the new cable will be laid alongside the old copper phone lines. The ISPs will be able to lease capacity from the government-owned NBNCo without having to deal with Telstra. That is good news because Australian business and consumers have been under-served by broadband speeds and overcharged as they have helped to prop up Telstra's near-monopoly profits.
It is about time as the copper wire telephone network is old technology that made Australia an also ran in the international broadband world. Now there is the opportunity to build a new network based on the realisation that wireless broadband is not a replacement for fixed-line digital mega-highways, but rather a supplement. Though fibre to the home would boost upload and download speeds, and decreases the time taken to transmit the data through a network, it will not address the lack of bandwidth on the fibre links between Australia and the rest of the world.
Another other issue is funding. Can the Federal Government fund the $43 billion cost of the National Broadband Network? Will there be private sector investment? If so, will it be the $21 billion envisioned?
In a discussion paper released on the same day as the NBN announcement, countenanced regulatory measures that the Government could introduce as the NBN was being built. These included beefing up the Australian Competition and Consumer Commission's power to regulate other companies' access to Telstra's existing network, some form of separation of Telstra's retail and wholesale arms and forcing Telstra to sell its HFC high-speed cable network and its stake in Foxtel. So are the consequences of the Trujillo/McGauchie strategy.
To enjoy speeds of up to 100Mbps, internet service provider Internode says users would be charged a monthly cost of $99.95. I pay around $80 per month for ADSL 2+. Internode should know, as they already offers the same internet access technology -- fibre to the home -- as the Government's yet-to-be-built broadband network.
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Seems to me that this new plan comes straight from the "Department of Grand Announcements" and wont actually come to fruition.
But it is nice to know that all Australians will get the broadband they deserve. Well 90% is the new 100% don't you know.
Nice one "Credit Card Kev"