Sunday, August 15, 2010

The Election and the NBN

I have been following the progress on the Governments negotiations with Telstra and the other powers that be over the new plan for Fibre to the home. All along, if they'd bothered to follow Marconomic principles they'd know full well that the idea is to separate infrastructure elements from the applications, data plans, and the selling of the information itself. The infrastructure would then be owned by the federal government and the rest would be allowed to have market forces at play and essentially be privately run. It appears that the Labor Government had finally achieved this with the go ahead, budgeting and rollout starting - The NBN would be a government run company that would own the new fibre. Private organisations, including Telstra would then pay for capacity on these to sell plans to consumers and to run new applications on etc. This, once built would fix the constant conflict of interest of Telstra owning infrastructure that competitors need to compete with Telstra. There is just no way of making it fair without separating infrastructure from the marketable aspects of the capacity of the infrastructure.

What the Labor Government had come up with should have always been bipartisan. This would have neutralised the issue in voters such as me. Having seen the alternative plan of the Liberals, which although vague in specific ownership details, gives the impression that government investment will be more wasteful than private investment, regardless of whether it is long term or short term investment.

Telstra and land developers can not be trusted to have appropriate cabling in place even in new suburbs. So often (our suburb included) developers have opted for the cheapest possible cabling because to them it is a cost without any visible gain in land prices. Concern that the whole suburb has to be inefficiently dug up again to upgrade the lines down the track is not on their radar or their balance sheet.

It is less efficient to regulate standards of cable (fibre) speed that has to be laid, then for the Government to own it in the first place, and their shouldn't be the pressure on geting a short term return on the investment either. As it is with roads, power cables, railways, airports and sewerage pipes it should be with data transmission - the Government should own the infrastructure - pure and simple.


Chris Fellows said...

Two assertions:

* Wireless is/will be better so the network will be a huge piece of superfluous corporate welfare.

* Regular humans do not need to move data any faster than it can be processed by human senses which existing networks are able to do perfectly well almost everywhere already. Companies and government agencies that need to move huge amounts of data tend to be clustered in technology parks or CBDs which can be linked with a much smaller network. The only reason for having a hyperfast network to everyone's house is so Ozsoc can transmit all the real-time video footage from everyone's house to their pattern recognition software to pick up thoughtcrime. I would think such a network would be a good investment if I were Ozsoc, but the whole 'boot stamping on a human face forever' vision of the future never held much appeal to me.

Marco said...

Assertion 1: *Buzzing sound* wrong

The constant rule of thumb (as opposed to that which varies over time due to improving technology) is that wireless is good for *mobile* applications and those that are "very" remote. By remote we are talking Urandangi remote, not Ingham/Ayr remote. While cable is better for things that don't move (homes, buildings, etc.) and a no brainer for the major Metropolitan areas. Politicians don't seem to get this, but every technician or engineer that I talk to says "like Duh."

Assertion 2: *Buzzing sound* wrong.
The data speeds that we thought were adequate yesterday is not going to be adequate for tomorrow. I can think of 10 discrete points in time when I thought that the data speeds I had available to me were enough for all my uses, and then new applications came up. Your non-sequiter of Ozsoc is meaningless because we as individual house-owners own and run the applications that we decide to - and they are provided by companies large and small with plenty of motive not to seem or be Big-Brotherly. The privacy we give up we tend to do in exchange for features, with eyes on security.

Chris Fellows said...

Your non-sequitur of Ozsoc is meaningless because we as individual house-owners own and run the applications that we decide to - and they are provided by companies large and small with plenty of motive not to seem or be Big-Brotherly.

We don't, you know. We run applications provided by oligopolies that continually download new features they think we want. These companies have plenty of motive to collaborate with whatever totalitarian nonsense is going. A broadband network under government control is a powerful tool for totalitarianism and therefore has to be viewed with pitchfork-wielding fear by all sane people.

I don't believe in any 'constant rule of thumb'. Technology has a way of disrupting constant rules of thumb. If cable is so crash hot, why are major metropolitan areas full of wi-fi networks?

Anyways, you win, I'm too cranky to think or argue about anything. Farewell.

Chris Fellows said...

Sorry. I feel better now. Those buzzing sounds just really get on my nerves. :(

Marco said...

I have been thinking about this issue again, and the cable vs. Next G (Wi Fi is actually cable to the building, Wireless from the box deceivingly making wireless seem as fast, convenient and cheap as needed) is not as important an issue as separating the long term (infrastructure) investment with short term (end use equipment and applications) ownership. The way Australia has been doing this (making private enterprise ( Telstra Optus etc.) build the infrastructure and then regulating how it is used - including price regulation almost as if it was Government owned) is what is most important to change. Regulation is an unsatisfactory replacement for Government ownership as it common leads to unnecessary duplicity of infrastructure in some cases, and eggs in one basket reliance on Telstra lines in other cases. If the Liberals had included as part of their plan to overtake Telstra's current wireless and cable infrastructure, and publicly own the new faster combinational infrastructure as it is being built, it would probably neutralise the issue in my mind.

Chris Fellows said...

I agree with you completely about the foolish way Telstra was privatised... much better to have the physical infrastructure in gvoernment ownership and a relaxed regulatory framework for its use. I have been thinking about how governments originally came to own infrastructure such as roads and railways and wonder if the 'bailout' model might be a better one... let the speculators build the turnpikes, railways, fibre networks, etc., in the boom times, then buy them at a discount with taxpayer money when times are tough.

Marco said...

I have looked at this when I looked at Managed Investment Schemes (MIS) in the forestry and other tree industry. The trick with MIS is that to entice investment in long term assets (in this case trees, but it works similarly for infrastructure) one just needs a big tax break as incentive. As with the railways, a lot of trees get planted in a relatively short time with no way of knowing whether there will be a glut of the product or whether the returns won't be there for other reasons. However the Government is in a way investing via the vehicle of foregone tax income. From what I remember of the railway boom in the US, there was a huge tax break incentive. With the bust up of a lot of the MIS schemes it may make sense for the Government to now own the trees by default, pay for their maintenance for the remaining years until maturity, then charge leasing fees to harvest the crops.

Chris Fellows said...

Well, it looks like we'll have an NBN for Armidale, Port Macquarie, and Mt. Isa, at least. :P

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