From show pony to dead horse

From show pony to dead horse

Summary: Telstra's 21Mbps Next-G boost and Internode's new 100Mbps FttH networks may be both companies' show ponies, but when it comes to helping most of us, their need-for-speed posturing is just a box-and-dice distraction that we've all seen before.


One of the most basic tips given to people in media training is how to diffuse an uncomfortable situation or deflect an uncomfortable question. "Stay on message," executives are told, "and take control of the situation by steering the conversation to an area of strength."

We see examples of this everywhere in Australian telecommunications, especially as companies outside the NBN tender whip up their campaigns to command leadership of Australian telecoms.

Donald McGauchie

Donald McGauchie
(Credit: Telstra)

Consider Telstra chairman Donald McGauchie, who last week told journalists last week that they "have got to get over this obsession with" the NBN. Telstra has moved on, McGauchie was saying, as though the company really had not just wasted nearly four years and untold millions trying to build and control a next-generation fibre-based broadband network.

With that kind of dismissive contempt, Telstra's one-time NBN backers would be justified in questioning whether Telstra was ever committed to change — and feeling like a dumped wife who sees her ex-husband out with his secretary the day after the divorce.

Telstra's new darling is the newly accelerated Next G mobile network, which was recently pushed to 21Mbps in an announcement so ridden with hyperbole that the company actually got a representative of Guinness World Records to contribute a quotation that looked suspiciously like it came straight from the fingertips of Telstra marketing staff.

"I've witnessed amazing records around the globe, but this is the first time I've had the honour of announcing a record which delivers such tangible benefits to an entire nation," Guinness' Australian representative Chris Sheedy is quoted as saying.

Tangible? Pardon? Sheedy, who is apparently a journalist in his day job, should have anticipated that a statement like that would send the wheels on the Australian media's BS meters spinning uncontrollably.

If Guinness actually checked the pumped-up network will deliver — 550Kbps to 8Mbps real-world performance, I am told company spokespeople admitted at the press launch — perhaps Sheedy wouldn't be so enthusiastic to take a ride on Telstra's latest show pony. Speed is one of the least pressing issues facing Australian mobile users these days, and everybody but a determinedly on-message Telstra knows it.

Real-world speed considerations shouldn't be so glaring with the latest centrepiece of Internode's ongoing market repositioning: a fibre-to-the-home (FttH) service offering 25, 50 or 100Mbps speeds starting at $49.95 per month.

Sound good? Of course it does. Ready to sign up? Don't bother: unless you live in the new Queensland suburb of Redbank Plains — 32km south-west of Brisbane's CBD, Internode tells us — you'll have to wait.

Through its partnership with Hills Industries subsidiary OptiComm, Internode is planning a dozen other such projects at new housing estates in South Australia and elsewhere. Which is great news for a few thousand Australians, but does absolutely nothing to help the other 20 million or so of us who are waiting to get better broadband without having to actually move house.

If — like me — you are on that boat, don't look to Internode for leadership. The company already sold your future to Telstra, signing a reseller agreement that saw Internode all but abandon its DSLAM roll-outs to access Telstra's far more extensive ADSL2+ infrastructure. It's a surprising deal that Internode still hasn't bothered to explain despite my enquiries — but more on that another day.

Putting FttH in a few housing estates does little to address the fundamental problems facing our country's broadband strategy

Like every company, Internode wants to be seen as an industry leader and agenda-setter. Yet putting FttH in a few housing estates does little to address the fundamental problems facing our country's broadband strategy. Internode isn't taking this approach national, or even regionally; heck, it couldn't even cost-justify continuing to roll out its own DSLAMs. All the company is proving is that FttH technology does work — which we've known for years thanks to the likes of Canberra's TransACT and US telco Verizon.

The most innovative thing about this announcement is the partnership model between Internode and OptiComm: instead of either company trying to shoulder both the wholesale and retail components of the business, they have stuck to their core competencies. Internode will find and service customers, while OptiComm worries about keeping the network running without carrying the overheads associated with customers.

This is a two-company approach to the split model that Telstra (which is still wiring new housing estates with antiquated and broadband-unfriendly infrastructure) has repeatedly sworn to fight to the death, and the same one that the equally and vertically integrated Optus will need to learn to love if it is, as many expect, the winner of the NBN contract.

It's a clear confirmation that nobody can do everything — especially in difficult times — and that Internode is dead set on sticking to its knitting. Which is a good strategy for Internode, which has thrown its ADSL2+ hat in Telstra's ring and is now seeking differentiators from the FttN services the NBN will deliver.

But will it deliver real change to Australian broadband? Meh.

We've heard all manner of companies bleating about speed upgrades for years, but Australian consumers are smart enough by now to realise that these companies are just beating a dead horse — the myth that speed is all we need. While their new services are innovative in their own right — and benefit the very small number of people that live in their catchment areas — real change will only come with a broader, more realistic approach to broadband that is actually relevant to the rest of us.

Topics: NBN, Broadband, Telcos, Optus, Telstra


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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  • Internode abandon their DSLAM rollout?

    I'd hold off declairing internode's DSLAM rollout dead just yet.....
  • RE: Internode abandon their DSLAM rollout?

    RTFA - Internode sold their souls to Sol$tra when they agreed to use Sol$tra's infrastructure - Internode are now forced to abandon any rollout (in any Sol$tra rolled-out region)
  • Perhaps not completely dead

    But they've certainly decided to lean heavily on Telstra to fill out the numbers, which takes the pressure off them to keep trying to push their own gear into as many exchanges. Funding new DSLAMs now seems to be a nice-to-have instead of a business imperative.
  • Interesting addendum

    After this blog went live today, we received a press release from Telstra highlighting its investment in a FttH rollout in South Australia's Hindmarsh Island "in an estate and village for over 55s".

    I have not been to Hindmarsh Island, but I gather from the pictures that soon-to-be-FttH-enabled Alexandrina Cove ( is a pretty place where Adelaide-area residents go to enjoy the beaches and their yachts.

    An interesting choice of location for Telstra to make a FttH announcement, since SA is Internode's home state and Internode made its first FttH announcement on the same day. Yet while Internode has about a dozen projects on the horizon, Telstra claims over 100 "completed or planned projects" like this.

    "Anything you can do, I can do better," Telstra is saying. Checkmate? Or has the game just begun?
  • RIM orphans

    In the meantine there are those of us who continue to struggle using ADSL1 connections attached to Telstra RIM equipment and get to experience the joys of congested backhaul and 10KB/sec downloads on our 1.5 and 8Mbps connections.

    The broadband in this country is completely f..ked.
  • They have not abandoned their roll out

    Internode has not stopped their own DSLAM roll out. They are continuing their own roll out of their DSLAMS.
  • RE: Perhaps not completely dead

    David, Internode make more profit by rolling out DSLAMs than using Telstra DSLAMs. They have more incentive than anyone to roll out their own equipment in every exchange in Australia.

    It's just that the NBN at the moment provides uncertainty as to whether their DSLAMs could be rendered obsolete in an instant. You can understand the hesitation.
  • Not quite - more like a weak marketing gambit

    Telstra can roll out as many FTTH developments as they like. I pity the residents of such estates.

    You only have to check the data per dollar value of Internode vs Telstra to see just how badly Velocity residents are being pocket-raped.

    Oh, let's not forget the completely artificial 30MB download cap. Probably a good thing when they give you a lousy 200Mb-5Gb a month, for about what internode charge for 50Gb at 100Mbit. Hmmm.

    Oh yeah, checkmate. Internode must be quaking in their boots.
  • Please give it a rest

    A second fit of pique because I didn't answer your email is hardly justified or reasonable, David.

    If you could decide to stop attacking me for the heinous crime of not having answered an email, I'd be happy to address your questions - and to correct the multiple deep and serious mistakes in your long chains of inference, both in this article and your previous one attacking me.

    I will give you an example:

    Regarding your false claim that Internode has, in any sense, stopped building DSLAM's because of also offering our customers the option of Telstra based ADSL2+ (in parallel).

    We submitted 23 new exchanges into the exchange access process in the last month.

    This week, around seven will enter construction, with the remainder caught up in the Telstra serial access process that limits the rate at which competition can gain a foothold.

    Further exchanges will go into build in the coming months, with the sole proviso being that the federal government decision on the NBN (whatever it is) comes out in a manner that doesn't make further investment of this type insane.

    If you could be so kind as to get off of your public high horse and send me a fresh set of direct questions, I'd be happy to answer them - as some time has passed, I presume you'd like to revise those questions a little at this point.

    Providing, that is, you decide to lay off of the petulant personal attacks.

    The rest of the industry continues to get commentary from me on request, and the rest of the media doesn't see fit to personally attack me if I don't happen to answer an email in my busy life.

    I hope you can see the pattern there. Personal attacks, and the creation of incorrect chains of inference that are, simply, false, is a pretty rude response to not getting what you wanted late last year.

    If you can get off of that high horse, I'd love to answer your email. If you can't, then I can live without your love.

    Simon Hackett
    MD, Internode
  • Redbank Plains is new??

    Lets rant a little about journalists getting things wrong, ie the speed of Next G - and then fall on our faces when we state that Redbank Plains is a "new suburb".

    Sure its new, if we travel back in time to 1842 when it was opened up for free settlement - being a convict run sheep station before that.

    Redbank plains school road - named after the school built there in 1874.

    Sure thats new compared to Paris or London, but its not exactly new by Australian standards.
  • Fluff.

    Gee with articles like this maybe you should write for South Park. :p
  • Did internode run over your cat or something

    Good to see you dont let the facts get in the way of an article rather rely on personal ill informed opinion to pass as journalism. I expect this from a spoilt 10 year old not an adult.
  • Gee..where's Terria NOW??

    Gee...whatever happened to the Terria group?? Looks like they turned on each other. Where's Michael Egan now with his spin. lol lol
  • Did internode run over your cat or something

    Right or wrong, your comment sounds like it was sent in from a spoilt 10 year old. No substance so why bother ?
  • Ditto here

    Mid north coast, 10 minutes from 2 major population areas & the best I can achieve from Smelstras antiquated local exchange is ADSL1 at 256Kbps while both my neighbours' only options are either dial-up or marginal wireless reception.
    High speed broadband? we wish!
  • RE: FTTH 100mbs

    What ISP would really be able to delivery these speeds to everyone and most websites already cap users, for now its a pointless project
  • Simon (Templer) The Saint.

    My we are thin skinned for such a seasoned campaigner Simon.

    But perhaps you would have grounds for complaint if you were actually attacked, say for example, like Sol Trujillo.

    But of course we all know that he is a sinner and you are a saint, because we read it on Whirlpool.
  • Anonymous Courage

    It's easy to throw stones when hiding behind an anonymous handle - and that is the best response to the issues raised by the article?

    The entire industry is bogged down in antiquity, a recalcitrant monopoly and successive Federal Governments bent on resisting change almost as much as the incumbent telco does.

    Even the NBN is at best a tail-chasing exercise that will result in maintaining the same environment. If it fails, who will people turn to? Telstra? They've already moved on.

    Speaking of dead horses, this article is certainly bent on flogging one. I'm sure the message will carry equal impact without resorting to emotive tirades over one's lot in life.
  • FTTH 100mbs

    It is not the point whether content providers throttle the flow of data or not, the point is BANDWIDTH, how many sources of content can you squeeze down the cable coming into your home simultaneously, ie streaming DV to your TV, downloading music to your ipod, phoning overseas on Skype, emailing, file transfers and all the new sources of content that will evolve in the future. Demand for content will force a supply of bandwidth from the telcos. Have faith, you will be older & wiser when it arrives, but it will come.
  • Internode abandon their DSLAM rollout?

    Silly sensationalism by a silly reporter. I'd bet my house that you write this nonsense just to generate hits on your blog so that you can justify your job.

    Simon Hackett is not at your beck and call, why have a tantrum about it. Which other MD's or CEO's are as approachable and as engaging as Simon?

    If this is how you behave then no wonder you get fed breadcrumbs.