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Wednesday, 23 September 2020 10:39

Coalition's fibre backflip no Damascene conversion

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Paul Fletcher: the man with a plan. Paul Fletcher: the man with a plan. Courtesy YouTube

While many people are rejoicing over the Coalition Government's backflip on its NBN policy and its announcement that it will spend to get fibre delivered to up to eight million subscribers in all, nobody should for a moment think that this is some Damascene conversion.

No, it is just that NBN Co fears it will soon become irrelevant in the overall scheme of things as private companies come up with their own offerings to gain customers, ignoring the NBN altogether.

It was laughable to see this statement from Communications Minister Paul Fletcher: "From the outset, the plan set out in our 2013 Strategic Review was to get the network rolled out as quickly as possible – and then deliver upgrades when there was demand for them."

Really? So the Coalition had this cunning plan? This is a mob that specialises in announcements, and announcements about announcements. It then tries to drive home the mantra that it is focused on outcomes. Sure. And I am focused on becoming the king of Jordan.

But then Fletcher cannot tell Australians the truth, that this entire backward-looking policy — remember Richard Alston's comments about people wanting broadband so they could look at porn easily? — is driven by ideology.

Now, however, after the government has sunk $29 billion into the NBN and owns what may well become a white elephant, he has had to get up from his slumber and react.

Having a government monopoly would have suited the Coalition admirably, despite its oft-stated goal of supporting private enterprise. Had there been no challenge to the NBN Co and its antiquated approach to anything and everything, all the whinging by the public would have been so much water off a duck's back.

The NBN has never become an election issue – and political parties will only react if they see victory at the polls being threatened. Remember how John Howard got David Hicks back to Australia pronto when it started looking like his detention by the Americans would damage him in the polls?

As it stands, without all the gathering competition, the NBN Co has been finding it tough to get its average revenue per user to levels which would enable it to break even. There is always talk of light around the corner, of becoming cash-positive in some year in the future. It is all a tactic to buy time.

But now the barbarians are at the gate. Optus has a decent 5G home offering that rivals what the NBN can give – and at a lower price. Aussie Broadband has gone its own way with its own fibre. Telstra has a decent 5G hotspot (so I'm told, they just won't send me one for a review) and the newly merged TPG Telecom (TPG + Vodafone) will soon join the band.

Plus there are numerous smaller players like Launtel in the mix and nobody really nurtures any good feeling towards the mandarins at the NBN Co.

There is angst among the telcos, and rightly so. Many of them (except Telstra) will have to shell out much more to build their 5G networks, now that Huawei has been banned.

Had there been genuine evidence of security issues with the Chinese firm's gear, then there would be no anger. But that simply isn't the case.

As it was in the days when Telstra was the 800-pound gorilla and squeezed everyone else in the telco business, so too NBN Co would like to be the boss man.

But unless it can make its offerings affordable, no retail service provider is going to bother reselling the product. Nobody wants to gain market share and make a loss.

The government must now be wondering if it waited too long to try and sell NBN Co. The road ahead does not look smooth and by the time the traffic has fallen to reasonable levels, the value that can be derived from a sale would be very little.

But maybe Fletcher has another cunning plan.


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Sam Varghese

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Sam Varghese has been writing for iTWire since 2006, a year after the site came into existence. For nearly a decade thereafter, he wrote mostly about free and open source software, based on his own use of this genre of software. Since May 2016, he has been writing across many areas of technology. He has been a journalist for nearly 40 years in India (Indian Express and Deccan Herald), the UAE (Khaleej Times) and Australia (Daily Commercial News (now defunct) and The Age). His personal blog is titled Irregular Expression.

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