I’m going to weigh back into the debate about the NBN after a few months not saying anything… To be honest, at the time of my last set of comments my employer at the time had a great deal of interest (financial and otherwise) at stake in the NBN, so my “point of view” could have potentially damaged that and so I kept quiet.
I’m no longer employed there and am now a free citizen so I get to speak my mind again!
The problem with the NBN is that it has become a trough of special interest and political point scoring and not a sensible technology project or government infrastructure program. I’d always had concerns that the way that the NBN Co was throwing its weight around in the marketplace and being backed by a Minister that could best be described as a “bully” was bad for the project. The government’s continual failure to deliver serious costings on the project made the whole thing smell even worse. The final nail in the coffin for me was shortly after doing her “deal” with Mssrs Oakeshott and Windsor it began to become apparent that prioritising “rural interests” and in particular their two electorates with the roll-out of the NBN was part of the deal.
Any time serious infrastructure projects, particularly expensive technology projects become parts of political horse trading at the highest level things are never going to go well.
I’m someone who favours free market economics generally. I think things tend to work out well when there is a profit motivation for companies to deliver services.
I’m also someone who likes a certain amount of socialism in my government. I like free universal health care. I’m in favour of paid maternity leave funded by the government for ALL women.
With that in mind I think sometimes it is important for the government to jumpstart certain infrastructure initiatives to ensure some level of equality that the free market is not inclined to deliver. In truth, the NBN should fall into that basic, but it doesn’t.
The fact of the matter is that politics have corrupted the NBN to the point where in its current form it is probably not salvageable. The NBN should be rolled out to the metro areas first, and not only the metro areas, but the metro areas with the highest incomes. Why? Simple, because those people have the money to pay an “early adopters premium” and ensure that the NBN is profitable from Day One! The network should then progressively be rolled out to the rest of the urbanites and we should start to see some economies of scale bring the price down while maintaining profitability.
This approach does two things: first, it gets the technology into the hands of the most people, quickly and with the best financial return. Secondly, it allows the NBN to build up a pool of funds to underwrite expansion into rural areas so that the Federal Government doesn’t get stuck wearing the full cost plus interest.
The NBN should also fall outside of the control of the Minister and be accountable to a senior bureaucrat appointed by the full parliament. If we’re serious about telecommunications infrastructure being critical, then it needs to sit outside the political machinations of single Minister.
The deal with Telstra should be scrapped. I agree with the idea, but the truth is, you can’t put rules in place that prevent competition like what the government and the NBN are doing. If Telstra wants to run their own proprietary cable and limit access to it, then its their dollar – may the market decide… So long as there is an open infrastructure program like the NBN in place. If Telstra want to build a parallel network, they should be entitled to and should be encouraged. Thinking about this longer term, if the NBN goes in and is the only game in town, what happens in twenty years when government neglect and lack of interest sees it looking like the Sydney Rail Network? No, if free enterprise sees and opportunity to provide a better product than so be it.
The most delicate issue of course is rural Australia. In any free market system they would have to pay outrageous rates to get decent service because frankly, it costs an astronomical sum to deliver them the services. I don’t really have an answer. I think the NBN should use profits from the metro regions to underwrite the roll-out but the ongoing maintenance is another issue. It is abjectly unfair to say that someone in a remote part of NSW should pay the same cost for broadband as someone in Surry Hills or Vaucluse. Should I have expensive broadband so that I can have cheap milk? Why can’t farmers just run profitable businesses?
Ultimately, the NBN has more questions than answers and is beginning to look like a train wreck waiting to happen. Unfortunately, the Gillard government can’t (because of their backroom dealings) stop it and nor does she have the political will to do anything about it. So eventually, we’re going to be sitting here in five years time doing a post-mortem of the wreckage of this government spending disaster which is a bit sad.
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