[AusNOG] NBN Legislation

[Mark Smith]

On Sat, 27 Nov 2010 11:11:50 +1100
Dmitri Kalintsev <dek735 at gmail.com> wrote:

> Bevan et al,
> 
> My reading of this says that the intent appears to be to ensure that:
> 
> - If you're building new infrastructure, it will need to be capable of
> providing L2 service (for example, you can't buy a wholesale L2 over HFC
> today);
> 
> - If you've re offering a high-speed L2 service, it meets at least base set
> of requirements (which are to match those of NBN Co, and judging from the
> technical product descriptions they have released to date, this should not
> be very hard);
> 
> Also, it appears to me that you're free to offer however complex and
> advanced L2 services *in addition* to the said "base bitstream L2 service"
> and price them as you wish. Here's your differentiation - differentiate
> away, as longs as you *also* offer a base service, at a regulated price
> point. I think this might actually help innovation, rather than hamper it.
> 

It discourages and prevents innovation, because it prevents people
offering a cheaper and less capable but quite acceptable service to
the target market. As an analogy, imagine if the government in the 1940s
mandated that all restaurants needed to provide seating, cutlery and
porcelain or glass crockery. That would have prevented the innovations
of drive through service, take away and fast food restaurants. I'm sure
most of us have utilised those "lower quality services" at some time or
other.

If the government had mandated that phone services must be PSTN quality
and availability, then we'd be unlikely to have mobile phones, because
when we have and use a mobile, we trade off quality and availability of
service for the convenience of mobility. Fortunately they didn't.

Innovation needs to be able to happen in both directions - value add,
at an increased cost, and value "reduce", at a reduced cost, which
provides a product or service to a market that formally wasn't catered
to, because it was being overshot.

http://books.google.com.au/books?id=SZQnfdM9O7wC&lpg=PP1&ots=ZjhdT5CUp6&dq=seeing%20what%20is%20next&pg=PA4#v=onepage&q&f=false



> Then again, I'm not a lawyer either.
> 
> Regarding Bevan's example with fibre in the basement - if my interpretation
> is correct, then you're free to add a switch and provide a service, as long
> as in doing so you're *also* establishing an ability to provide a "new
> world-compliant" service to a potential wholesale purchaser, wishing to
> serve somebody (else?) in the same building with a "universal bitstream L2
> service" which he then would be able to buy from you at the regulated price.
> 
> -- D
> 
> On Fri, Nov 26, 2010 at 10:33 PM, Bevan Slattery
> <Bevan.Slattery at nextdc.com>wrote:
> 
> > On top of that - ACMA/ACCC will be deciding on what products and technical
> > standards everyone will use (loss of innovation) and everyone must offer
> > non-discriminatory pricing even though the competitive infrastructure
> > providers have 'risked' their capital to build these networks.  Pricing
> > regime will also be regulated along with any volume discounts.  You can go
> > to any provider and get the same vanilla service as determined by the
> > Government and NBN Co..  So with innovation and product differentiation
> > removed, those that have the cheapest cost of equity/debt will win.  And
> > it's not hard to guess who that is.
> >
> > This is simply economic and technical communism.  Welcome to the new world
> > order.
> >
> > [b]
> >
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