NBN Co chair warns on coalition policy

 

Defends monopoly.

NBN Co chairman Harrison Young has publicly attacked the Coalition's proposed broadband policy as a potentially more expensive and slower option than the existing National Broadband Network.

Young told a Committee for the Economic Development of Australia lunch yesterday that the Coalition's plans to pare back use of fibre-to-the-home technology in favour of fibre-to-the-node or use existing hybrid-fibre coaxial infrastructure would simply slow down the network's rollout.

"If you retain Telstra infrastructure as part of the National Broadband Network, even just the last bit, you will not have accomplished the separation of wholesale from retail that was a major objective of Project NBN," Young said.

Using a greater portion of Telstra infrastructure, he argued, would require more and slower negotiations with the incumbent, while introducing more legacy IT from Telstra.

Such infrastructure "could only be navigated with Telstra's help, turning code into bottleneck infrastructure and giving Telstra ineradicable advantages", he noted.

"There are always trade-offs to be made. Some of them live inside the engineering task, while some live in the realm of policy. And from time to time, they will change their spots," he said.

Where shadow communications minister Malcolm Turnbull has marketed the Coalition's alternate policy as sufficient for Australia's current needs, Young said stripping NBN Co of its monopoly would have dire consequences.

"If the richest people in the country have broadband that is only 'good enough', someone — Telstra, Optus, a new entrant? — someone is likely to offer those households a 'superior' service, overbuilding the now NBN Co-owned HFC footprint with fibre, again sucking profits out of NBN Co, and undermining NBN Co's ability to offer uniform national wholesale prices," he said.

He also defended NBN Co's decision to sign agreements with Telstra and Optus that would see the migration of their respective cable broadband customers off the network and onto the NBN.

The Optus agreement was criticised as contrary to economic logic after it was approved by the competition watchdog earlier this year.

Young said failing to neutralise a source of potential competition like Optus' and Telstra's cable networks would also threaten the cross-subsidy NBN Co was tasked with providing between built-up and regional areas.

"I haven't done the math, but this is an issue any Government would have to wrestle with if it elected to leave the HFC networks alone," he said.

"So what happens if you decide to make NBN Co the owner of those HFC networks and instruct it not to overbuild them?

"Depending on technical issues I am not competent to discuss, you could have the ironic situation that the wealthiest suburbs have the lowest-quality broadband in the country."

Turnbull said Young had failed to take into account the Coalition's plan, much of which is yet to be made public.

"Not only do we prefer competition to government monopoly, but we believe that subsidies should be explicit and transparent," he said in a blog post on Monday.

"We are thoroughly committed to providing access to broadband to regional and remote Australia at city prices — so there is no discrimination by reason of geography — but the cost of doing so should be transparent.

"And there is plenty of precedent for that. What, after all, is the [Universal Service Obligation]?"

Young said NBN Co would not become involved in pet projects or "covert mission creep" — the latter a point of criticism from NewSat.

Instead, it would seek to use any additional profits to lower wholesale prices over time, a measure he assured would be passed on by competing retail service providers.

"Project NBN makes the crucial assumption that there will be vigorous competition at the retail level, which will drive down prices and deliver value to end-users," he said.

"But what if that doesn't happen? I've asked that question of a lot of friends and colleagues. Most of them answer that of course there will be competition. Look how many retail service providers there are, they say.

"Telecom is a sexy industry, full of entrepreneurs. I tend to agree."

Copyright © iTnews.com.au . All rights reserved.


NBN Co chair warns on coalition policy
 
 
 
Top Stories
Frugality as a service: the Amazon story
Behind the scenes, Amazon Web Services is one lean machine.
 
Negotiating with the cloud email megavendors
[Blog post] Lessons from Woolworths’ mammoth migration.
 
Qld govt to move up to 149k staff onto Office 365
Australia's largest deployment, outside of the universities.
 
 
Sign up to receive iTnews email bulletins
   FOLLOW US...

Latest VideosSee all videos »

The great data centre opportunity on Australia's doorstep
The great data centre opportunity on Australia's doorstep
Scott Noteboom, CEO of LitBit speaking at The Australian Data Centre Strategy Summit 2014 in the Gold Coast, Queensland, Australia. http://bit.ly/1qpxVfV Scott Noteboom is a data centre engineer who led builds for Apple and Yahoo in the earliest days of the cloud, and who now eyes Asia as the next big opportunity. Read more: http://www.itnews.com.au/News/372482,how-do-we-serve-three-billion-new-internet-users.aspx#ixzz2yNLmMG5C
Interview: Karl Maftoum, CIO, ACMA
Interview: Karl Maftoum, CIO, ACMA
To COTS or not to COTS? iTnews asks Karl Maftoum, CIO of the ACMA, at the CIO Strategy Summit.
Susan Sly: What is the Role of the CIO?
Susan Sly: What is the Role of the CIO?
AEMO chief information officer Susan Sly calls for more collaboration among Australia's technology leaders at the CIO Strategy Summit.
Meet the 2014 Finance CIO of the Year
Meet the 2014 Finance CIO of the Year
Credit Union Australia's David Gee awarded Finance CIO of the Year at the iTnews Benchmark Awards.
Meet the 2014 Retail CIO of the Year
Meet the 2014 Retail CIO of the Year
Damon Rees named Retail CIO of the Year at the iTnews Benchmark Awards for his work at Woolworths.
Robyn Elliott named the 2014 Utilities CIO of the Year
Robyn Elliott named the 2014 Utilities CIO of the Year
Acting Foxtel CIO David Marks accepts an iTnews Benchmark Award on behalf of Robyn Elliott.
Meet the 2014 Industrial CIO of the Year
Meet the 2014 Industrial CIO of the Year
Sanjay Mehta named Industrial CIO of the Year at the iTnews Benchmark Awards for his work at ConocoPhillips.
Meet the 2014 Healthcare CIO of the Year
Meet the 2014 Healthcare CIO of the Year
Greg Wells named Healthcare CIO of the Year at the iTnews Benchmark Awards for his work at NSW Health.
Meet the 2014 Education CIO of the Year
Meet the 2014 Education CIO of the Year
William Confalonieri named Healthcare CIO of the Year at the iTnews Benchmark Awards for his work at Deakin University.
Meet the 2014 Government CIO of the Year
Meet the 2014 Government CIO of the Year
David Johnson named Government CIO of the Year at the iTnews Benchmark Awards for his work at the Queensland Police Service.
Q and A: Coalition Broadband Policy
Q and A: Coalition Broadband Policy
Malcolm Turnbull and Tony Abbott discuss the Coalition's broadband policy with the press.
AFP scalps hacker 'leader' inside Australia's IT ranks.
AFP scalps hacker 'leader' inside Australia's IT ranks.
The Australian Federal Police have arrested a Sydney-based IT security professional for hacking a government website.
NBN Petition Delivered To Turnbull's Office
NBN Petition Delivered To Turnbull's Office
UTS CIO: IT teams of the future
UTS CIO: IT teams of the future
UTS CIO Chrissy Burns talks data.
New UTS Building: the IT within
New UTS Building: the IT within
The IT behind tomorrow's universities.
iTnews' NBN Panel
iTnews' NBN Panel
Is your enterprise NBN-ready?
Introducing iTnews Labs
Introducing iTnews Labs
See a timelapse of the iTnews labs being unboxed, set up and switched on! iTnews will produce independent testing of the latest enterprise software to hit the market after installing a purpose-built test lab in Sydney. Watch the installation of two DL380p servers, two HP StoreVirtual 4330 storage arrays and two HP ProCurve 2920 switches.
The True Cost of BYOD
The True Cost of BYOD
iTnews' Brett Winterford gives attendees of the first 'Touch Tomorrow' event in Brisbane a brief look at his research into enterprise mobility. What are the use cases and how can they be quantified? What price should you expect to pay for securing mobile access to corporate applications? What's coming around the corner?
Ghost clouds
Ghost clouds
ACMA chair Chris Chapman says there is uncertainty over whether certain classes of cloud service providers are caught by regulations.
Was the Snowden leak inevitable?
Was the Snowden leak inevitable?
Privacy experts David Vaile (UNSW Cyberspace Law and Policy Centre) and Craig Scroggie (CEO, NextDC) claim they were not surprised by the Snowden leaks about the NSA's PRISM program.
Latest Comments
Polls
Which bank is most likely to suffer an RBS-style meltdown?





   |   View results
ANZ
  21%
 
Bankwest
  9%
 
CommBank
  11%
 
National Australia Bank
  17%
 
Suncorp
  24%
 
Westpac
  19%
TOTAL VOTES: 1455

Vote