Choosing a vote: as easy as O-E-C-D?

Choosing a vote: as easy as O-E-C-D?

Summary: Well, here we are. After years of bluster, measured progress and loads of annoyance, Australia's broadband users head to the polls on Saturday with a score to settle.

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Well, here we are. After years of bluster, measured progress and loads of annoyance, Australia's broadband users head to the polls on Saturday with a score to settle.

The real question, of course, is with whom is the score to be settled? With John Howard, who some say has failed to guide Australian telecoms to its potential? Or with Kevin Rudd, who has been quick to criticise the government but seems to be lacking more constructive options?

If you're voting on Saturday and haven't yet made up your mind, put on a blindfold and grab your dartboard. If you'd like to get a bit more scientific, consider the age-old question that I have always used to choose whom to vote for: are we better off than we were when [insert politician's name] took office?

Howard's term has seen major changes in the telecommunications industry in Australia and out of it. Broadband Internet, wireless Internet, HDTV, 3G, MP3s, Windows 98 and even Google were just twinkles in the eyes of some fresh-faced creative types when he took office, but all now play a significant role in Australia's day-to-day functioning.

None of this is contentious: what is contentious, however, is the debate over how best to bring Australian broadband to world standards. Figures from the OECD are often touted by one political party or another as either a commendation or a condemnation of Australia's broadband policy.

In the name of answering the question of whether we are in fact better off now than we were before, I thought it would be instructive to look at some of the OECD figures that weren't seized during lame attempts at positive spin.

Broadband penetration (long-term growth)
Then: In 2002 (Q2), Australia's broadband penetration was 1.31 per 100 homes. This ranked Australia 19 out of 30 countries with less than half the penetration of the OECD average (3.82) and just six percent the broadband density of champion Korea. That's down from 13, where Australia ranked at the end of 2000.
Now: Australia ranks 12 out of 30 countries, with penetration of 22.66 per 100 homes.
Relative to the world: This is above the OECD average of 18.76, and two-thirds the ranking of champion Denmark. Australia's penetration is now 17.3 times what it was in 2002; that's more than three times the growth of the OECD overall during this time, a whisker behind the 18.6-fold growth in the UK, and represents the second-highest growth in broadband connections amongst "first-world" OECD countries since 2002.
Verdict: Australians love their broadband: since 2002, our broadband growth has outpaced Canada, the US, Japan, Germany, Finland, Norway, and yes, even New Zealand. Clearly, we've been more than ready to accept new services.

Broadband penetration (current growth)
In percentage terms, Australia's per-capita broadband penetration grew 5.7 percent from 2006 to 2007 -- fourth out of 30 OECD countries behind Ireland, Germany and Sweden.
Relative to the world: Only Ireland, Germany and Sweden are growing faster.
Verdict: Enough Australians still don't have broadband that demand is continuing to grow strongly. Availability of so-called mobile broadband services, which have flooded the market in the past year, may play a role here.

Fibre Internet
Then: Fibre connections are for telcos.
Now: Australia is one of 19 countries that rated a zero in the percentage of fibre connections to total subscribers chart.
Relative to the world: Canada, Finland, France, Germany, Spain, the UK and others don't have fibre either, so at least Australia isn't alone.
Verdict: Fair enough; fibre connections are relatively new across the OECD. And just because Iceland and the Slovak Republic have fibre-to-the-home, doesn't mean we should expect the same.

Pricing
Then: With dial-up plans in the AU$30 per month range, ADSL and cable broadband debuted closer to the AU$100 per month mark.
Now: Australia has the 12th most expensive broadband in the OECD countries, with a price range of US$21.66 to US$108.45 per month (of course, if you're on a plan with per-megabyte excess charges, this could go much higher)
Relative to the world: Australia is at the high end of a cluster of countries where pricing starts around the US$21 mark, but of other well-established economies only Canada, Italy, and South Korea have more expensive broadband.
Verdict: Pricing of Australian broadband hasn't really changed that much, although low-priced entry-level services have given more and more people the chance to lower their expectations from broadband. Overall, Australia is squarely in the middle of the pack, which isn't great and it's not terrible.

Speed
Then: Back in the late 1990s, most of use were using dial-up modems at 56Kbps and businesses had 64Kbps or 128Kbps ISDN lines.
Now: Australia ranks 11th in advertised speed with a peak speed of 20,480 Kbps Relative to the world: Denmark and Italy have the same peak speed, which is half that in the US; one-fifth the maximum speed in Finland, France, Korea and Sweden; and a fraction of the 1Gbps services in Japan.
Verdict: This is the hardest category to judge, since real performance is subjective and advertised maximums are technology based rather than real-world based. Based on technology, Australia is yet again in the middle of the pack, which is consistent if not extraordinary.

By my eye, Australia has more or less held its position towards the top of the middle third of the OECD countries, in most categories, for the better part of this decade. Is this good enough? Not necessarily. Should we really be aiming to knock Japan, Denmark and the like out of the top spot? Not really. But does broadband policy need tweaking? Most definitely.

The election's potential role in this tweaking remains to be seen. Could a Labor government improve our world rankings by making broadband faster, cheaper, and more popular? Can Australia really top the broadband charts, or should it even expect to? And if we did, would we know what to do with our superconnected selves?

Whichever party wins on Saturday, it will inherit a telecommunications industry that has, despite obstacles (many self-imposed by Telstra) enjoyed significant progress over the past eleven years. A change of government doesn't necessarily mean that has to change, and well-placed policies might even speed up the process -- if only because Telstra is likely to be nicer to a Labor government than it has been to Howard's.

I can't tell you who's going to win on Saturday, and I certainly won't tell you how to vote. One thing is sure, though: with Telstra still fighting regulation, its competitors still fighting for market share, the government fighting to push through its WiMax-fibre network, and the digital switchover due to begin in the next term of government, it's going to be interesting to watch.

How much will broadband policy affect your vote on Saturday? Can anything other than the private market increase our world rankings? Does it really even matter anyway?

Topics: Broadband, Networking, NBN

About

Australia’s first-world economy relies on first-rate IT and telecommunications innovation. David Braue, an award-winning IT journalist and former Macworld editor, covers its challenges, successes and lessons learned as it uses ICT to assert its leadership in the developing Asia-Pacific region – and strengthen its reputation on the world stage.

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3 comments
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  • Most users main problem

    The problem I find that annoys most tech-savvy netheads is that unlike from what I believe is the vast majority of other countries we in vary rare cases give out 'unmetered' connections. In most other OECD countries you pay for the connection a month... that connection is unmetered. So many international IT professionals have commented on how ridiculous our 'pay by the gb' scheme is. I find that most heavy users of the net aren't concerned about BB speed here anymore, it is data capping that prohibits connections to be used to their fullest.

    I know that there are counter-arguments to this, but from my experience this is where Australia falls behind. I don't pay my telephone connection each month but then get told I can only make 30 full phone calls and after that I can only speak in one out of every eight seconds.
    anonymous
  • Data Limits

    Your are 100% correct. The problem is not so much the monopoly between the exchange and the home then, but rather Australia and the world (where Telstra again largely has a monopoly). Should the government be investing in this fibre instead?

    On another note, the main problem I have with the Exchange situation is a lack of consistency and transfers. Changing providers is getting more complicated as the variety of infrastructure changes, and neighbours shouldn't be getting vastly different speeds because of poor line quality.
    anonymous
  • Access still an issue

    I used to have ADSL2+ but now I have a crippled ADSL1 connection that can not reach the speed (1500Kbit/sec) I pay for.

    Why?
    Because the last 400m of my phone line are faulty, deteriorating rapidly.
    Telstra can, and has, refused to fix the fault. The TIO is powerless to help and Sen Coonan (and dept) do not seem to know how to send email.
    A reply takes over a month and all three i have received tell me to contact the TIO, even though I include the reference to my already finalised complaint to the TIO.
    anonymous