[AusNOG] Aust Govt will build National Broadband Network, no company will be awarded the tender.

[Matthew Moyle-Croft]

Tim McCullagh wrote:

>
> The issue is not is FTTH a good idea.  The issue is "is there demand 
> and a need for it" and are consumers prepared to pay for it.  From the 
> industry point of view "how will it operate and under what rules, 
> costs etc etc that bevan eluded to".  Matthew have you ever dealt with 
> DBCDE.  If you have you will probably know why this is important.  
> They have no bloody idea about the industry and they will advise the 
> government on how to draft the regulations.
Yep - as an access seeker we've dealt with all kinds of bits of 
government and I agree with you about DBCDE.

I think that rather than assume failure, we need to at least, as an 
industry, start working hard on ensuring that the outcomes match what we 
want/need.   Are you a member of, for example, Communications Alliance?  
I'm certainly hoping CA can take a bit of a lead in standards settings 
etc in an NBN world.  If not CA, then some other appropriate body.

At the moment, because of history so far, we've ended up in a situation 
where TLS have dominated the scene (and will continue to do so really) 
and as such we haven't ended up with the competitor density to deliver 
alternative last mile networks in brown fields areas.   We've got some 
Optus cable, TransACT and a tiny bit with Bright.  None of which can be 
claimed to be roaring successes.   We're only now seeing a tiny bit of 
FTTP in some new areas.

So, the idea that commerical forces will create this network in the time 
frame we want, when, as you both claim, this NBN FTTP thing is not 
commercially viable, I think is being foolish.

The outcome I was hoping you'd both suggest is one where incentives are 
put in place to build alternative LMN (Last-Mile-networks) and balance 
TLS's vertical integration.   Many countries - Korea, Japan etc have 
made large tax-incentives (some similar to the R&D 150% rebates here) to 
ensure that the networks are built.  Japan has many more alternative 
networks, even though NTT there is just as scary as TLS here.
The issues, as you've both suggested are commercial not technical.  So, 
if the government had wanted to go down that path, they could have made 
the right economic tweaks to start that happening. 

The only problem is - GFC.   No one can borrow (see Bevan's issue with 
"a mere US$100m").  So, guess what - the government has put itself in 
play as the backer of the project so that it gets built! 

Governments have a place in looking toward the future and making 
decisions which (hopefully) set us in the right direction for the longer 
term (yeah, you can be cynical, but it is the role of government).   
Their current NBN decision is to try and set that infrastructure up and 
get it moving early so that when we want it (10 years out) it's built 
and ready.  

Deep down I want many LMN.  I want commercial reality to triumph and to 
have real infrastructure competition.   But the way the competitive 
market place in Australia has occured due to the way TLS was sold off 
has meant it either won't happen or it'll just take too long and affect 
the economic outlook of our country.

If the NBN tries to sell it's ports for too much then it won't work.  
The goverment needs the pricing to drive take up so it can get the 
economic outcomes it desires.  So, I think the government will take a 
bath on it.  It's the only way.
>
> I would rather be in Telstra's position than the NBN corporation, if I 
> was I could turn NBN into a huge white elephant even with the 
> government in the NBN corner.  That is not to say it won't hurt 
> Telstra and this the shareholders like yours and my super funds.  You 
> cannot unscramble an egg
You can't unscramble it, But you can cook it with parsley, milk and 
cracked pepper and it's tasty.

MMC
>
> regards
>
> Tim