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The Australian: contradications « Previous | |Next »
January 1, 2011

This is a visual representation of The Australian's picture of the Gillard Government. What is surprising is that the national broadband network is missing from the cartoon. This is surprising, given that the NBN is central to the Gillard Government's understanding of national politics and that 2010 was the year of the NBN.


No matter. The editorial---A New Year wish: more digital visionaries---plugs the hole. It acknowledges that the internet/digital revolution is transforming the economy, that this revolution will affect the jobs and economic wellbeing of Australians, that digital technology destroys and creates, and that this carries huge economic potential as well as challenge.

It argues that instead of the Government trying to protect us from the forces of globalisation the job of government is to put the macro settings in place to give business the flexibility to respond to rapid change.The market will determine the direction.

Then the hammer comes:

The $35 billion NBN is seen by Labor as "important infrastructure" that "will change our way of life", yet it is being rolled out without proof that it will improve productivity. The government touts the health and education services to be delivered by the NBN, but the project is not commercially viable and it is far from certain that it will generate the new businesses its advocates claim. Labor has put all its policy eggs in the NBN basket, but it is at best a risky response to such a huge challenge. Australia needs more digital visionaries, not cable-laying nerds, to truly exploit the digital revolution. We need broad thinkers, not just more broadband.

Surely it is up to business and the market entrepreneurs to respond to the disruption of the media industry with innovation---new entrants offering a mix of telephony, broadband and video services? After all, that Hayekian idea is a central meme of The Australian's conception of a market society, despite it's determined attempts to try to block the building of the NBN.

In The Australian's own words "the job of government is to put the macro settings in place to give business the flexibility to respond to rapid change." This is a central tenet of The Australian's defense of classical liberalism and free-market capitalism against what it claims are the horrors of socialist and collectivist thought that lead us to the road to serfdom as sure as night follows day. In Hayek's view:

the role of government should be limited to ensuring that markets work, and to providing a parsimonious level of welfare. Governments which intervene in markets are heading down what Hayek described as the slippery slope of totalitarianism, for the only freedom worthy of the name is market freedom. The only institution to be quarantined from the market is the family, though Hayek gives no justification for this view and his definition of ‘family' is confined to a small group separated from the wider world. When we step outside the white picket fence we leave behind values such as compassion, friendship and solidarity. All transactions are market transactions; there is no point in doing anything for anyone else, unless it's part of a market exchange.

So it is the entrepreneurs in the self-regulating market who are the visionaries. Entrepreneurs are often at the forefront of innovation. They possess a unique set of skills that lends itself to inspired invention and driven change. Innovation is the driving force of capitalism and economic growth and entrepreneurs are the heroes of capitalism.

Consequently, the finger can be pointed at The Australian for its lack of vision. But The Australian is not noted for self-criticism is it.

| Posted by Gary Sauer-Thompson at 10:12 AM | | Comments (5)


The Murdoch empire's objection to the NBN is consistent with their stake in existing high-bandwidth infrastructure: foxtel.

Bandwidth (like diskspace and freeways) only have one capacity: 95% full, and one of the key class of providers of that bandwidth would be competitors to Murdoch.

Those competitors of news analysis and entertainment will meet with similar strident attacks as bloggers have, but Murdoch realizes it's easier to prevent the formation of the competition by blocking the infrastructure that would allow it.

Note: the NBN is about the only significant difference between tory and alp policies these days. Short of complaining about poor management of policy implementation, what else can the Oz attack the ALP about?

I am not sure that the end result of NBN will change our lives but the roll out will change all those peoples lives that are connected with the building of it. The NBN will create many jobs and its clear that while Labor has backflipped and postpone many things they are perservering with this for that reason.
True too that after its all finished other system of delivering broadband may have evolved to equal or even better the NBN but that is no reason not to build it.
The Oz and other critics will poopoo things always as this is their role.

you'd think that Foxtel would welcome the competition that will emerge with the NBN --the new entrants offering the triple play of telephony, broadband and video services. This triple offering has been on offer in Europe for seven years and in the US for five years so News Ltd knows what is going to happen.

This bundle of services is being offered by Internode and iiNet now. Presumably Foxtel can offer this triple service to extend its consumer reach beyond Telstra's limited cable network.

What may result is the splintering of Telstra from Foxtel as the former is offering the triple play through its T-Box service? Sport is the key content for many consumers and the NBN is going to cause dramatic change in sports broadcasting.

RE: "I am not sure that the end result of NBN will change our lives"

Probably not, but it is sure going to shake up the telecommunications media industry. For instance, the NBN poses a threat to Australia's commercial free-to-air television networks because of the competition for eyeballs from the competing providers of the triple services---telephony, broadband and video services. (eg., Fetch TV offered by Internode and iiNet )

So the commercial free-to-air television networks will try to lock in sports broadcasting---which is expensive.

Yes free to air networks may change and develop a system to charge for some content. This would enable them to compete better for the sport.
Providers like Foxtel will also probabaly move to more Ad breaks to ensure 2 money streams.

The thing to remember about the NBN is that it wont be completely rolled out and then in 10 years someone will throw a big switch and it will all work. It will be rolled out gradually and those parts will then work. So it can be stopped being rolled out at any stage if something as good or nearly as good and a lot cheaper comes along.
Also CSIRO are in the initial stages of developping a system of transmitting the internet through the free to air television network which may throw a big spanner in the works.
Will be interesting to see how it all plays out.