Government must play bigger role in broadband takeup: IDC

Market researcher IDC has called for the government to take concrete steps to grow broadband adoption in Australia, arguing that public sector efforts were a crucial spur to the market overseas.

Landry Fevre, telecommunications research director at IDC Australia, said a new report had pinpointed seven steps Australia must take to move from broadband backwater to industry leader.

Government had played a crucial role in broadband uptake in places such as South Korea, Canada and the European Union (EU), he said.

South Korea had mandated a certain level of broadband penetration back in 1999. In Europe, France's broadband uptake was growing fastest -- a phenomenon also largely due to regulatory activity, Fevre said.

"Incumbent France Telecom is selling its cabling infrastructure and being challenged by the second biggest provider in a very big way," he said. "The regulator has put the price of local loop very low by OECD standards."

Fevre said Australia needed to remove the DSL network speed cap, cut Unbundled Local Loop (ULL) prices and benchmark them against other OECD nations, develop a national broadband initiative for local councils, get Telstra to sell Foxtel, adopt a strong policy on wireless in regional areas and sell off Hybrid Fibre Coaxial (HFC) infrastructure.

Those moves could be co-ordinated and controlled by setting up a broadband regulator with bite, he said.

"In Europe, I think in early 2000 they had e-Europe 2005, where the EU mandated every single state," Fevre said.

Government needed to play a much stronger hand if broadband uptake was to happen quickly enough to get the best market results, he said.

Australia was in an odd situation since it had both the Australian Communications Authority (ACA) and the Australian Competition and Consumer Commission (ACCC), he said.

Yet the ACCC seemed to take a very long time to get anything done, leaving the way clear for "near-monopoly" Telstra to marshal its legal forces for an effective counter-attack, Fevre said.

IDC has, however, revised its broadcast forecasts upwards as a result of this latest report.

By January, one out of four internet users would connect using broadband and that would become two out of four by 2007, IDC found.

Furthermore, Australia would have 1.5 million broadband subscribers and the market would be worth $1.2 billion by January and four million by 2008, IDC found.

Telstra reported it had signed up its millionth broadband subscriber this week.