Save broadband from the politicians

Save broadband from the politicians

Summary: Internet access and infrastructure have rarely been -- how shall I put it? -- the sexiest of subjects. Yet in this election, it seems politicians are finally realising the power of technology both as a vote winner and a means of communicating with the increasingly tech-savvy electorate. Oh dear ...

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commentary Internet access and infrastructure have rarely been -- how shall I put it? -- the sexiest of subjects. Yet in this election, it seems politicians are finally realising the power of technology both as a vote winner and a means of communicating with the increasingly tech-savvy electorate. Oh dear ...

After a protracted phoney war, John Howard has finally called the election. While voters will heave a sigh of relief at knowing there is an end in sight to the baby kissing and rhetoric, those with an interest in broadband will be on tenterhooks to see which way the coin will fall on Australia's infrastructure.

Helen Coonan

At a debate staged earlier this month between Communication Minister Helen Coonan and her shadow Labor counterpart Stephen Conroy, both were keen to shout about the importance of broadband in face of the upcoming vote.

Labor's broadband strategy has rotated around a fibre-to-the-node plan -- complete with figures borrowed from Telstra.

Can't Labor afford economists these days?

Despite the plan remaining very light on detail and disappointingly unambitious in terms of speed, it doesn't stop Conroy parroting the line about it being "Labor's most expensive election pledge".

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Coonan, meanwhile, apart from fending off court challenges from Telstra, launched her re-election campaign back in June with the announcement of a AU$1 billion funding boost for the OPEL group, and continued her attempts to curry favour with the electorate by hinting at splitting up Telstra and then withdrawing -- like a toddler dipping an experimental toe in a stone-cold sea and finding the temperature not conducive to a swim.

As Coonan herself has pointed out, Australian broadband has gone from geek speak to barbeque conversation stopper in recent years. I want to believe that politicians are paying tribute to the importance of high-speed infrastructure by making it part of their election pledges, but broadband is simply too important to be left to the whims and vagaries of elections.

Broadband is fast on its way to becoming as important to the Australian economy as rain -- and it's a vital plank of infrastructure that should have been sorted by government long before Australians were faced with the prospect of standing at the ballot box.

Meanwhile, both Rudd and Howard are attempting to showcase just how very down with technology they are by using YouTube to broadcast their video pledges.

Maybe one day all the voters they are trying to reach will have the broadband speeds necessary to watch them.

Topics: Broadband, Government, Government AU, Networking, NBN, IT Employment, Wi-Fi

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9 comments
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  • Save broadband from the politicians

    The problem in Australia isn't download or upload speeds the problem is the incredible high cost of internet here and the complete strange practice of being limited on download and uploads.

    A one month internet bill in Australia is what Chinese pay for the year for a 2mb download line. And its the same around the world and other 3rd world nations.

    Australia will always be behind in technology and more importantly technological infiltration if download and upload speeds are limited.

    Telstra completely takes away all the cost advantages of switching to technology by excessively charging for all this usage, unlike every other country in the world (except maybe South Africa) and despite what they say it is completely unwarranted.

    The other problem is that the gov't is even talking about owning or developing these broadband lines. Why is it not open to competition from other suppliers. USA, European and Asian companies would salivate at the change to lay lines in Australia, especially at when most Australians pay on average 10 times more than any other person on the planet for internet and have limited upload and download access which the others do not.

    Take away the monopoly or watch Australia fall even more than 5 to 10 years behind even the most basic ecomonies.
    anonymous
  • Real problem is

    The real problem is that a conflict of interest exists inside the Federal Government because its majority shareholding of the dominant Telco interferes with its regulatory responsibilities. Basically it should either sell out or break up the Telstra business. Unfortunately because it is $$$ hungry it is likely to do neither.
    anonymous
  • Your comment is 12 months too late

    This would have been true 12 months ago but not today. The government sold the last portion of the company last year. There is now no direct government ownership although there are shares owned by the future fund but this is not a controlling interest and should not be politically aligned.
    anonymous
  • Still a problem

    Whether Telstra is directly owned by the Government or indirectly controlled through the future fund the implicit conflict of interest still remains. This is because most of the shares in the fund are Telstra shares, and the Govt is intent on maximising it's ROI inorder to give tax cuts to rich mates.
    anonymous
  • Uneducated cynic

    Addressing your comment Kevin, or would you prefer Mr Rudd?

    The future fund has a substantial holding but can not be considered a controlling interest. They function as an independent body to the incumbent government and will eventually reduce their Telstra holdings using the cash from sales to build a balanced portfolio of assets.

    The government had a simple choice, sell some now, and place the rest in a future fund who can then sell these at a later stage to create a balanced portfolio or sell the all in one big hit. They went with the former because the latter would have caused the price to drop as they would not have been oversubscribed not even taking into account the market would not have had that much spare money to buy Telstra shares.

    The future fund is intended to guarantee public servant’s superannuation payments; dividends are now paid into the fund and not for the government’s “rich mates” as Labor supporters would want you to believe. If anything the federal government now has about $2 Billion in less income each year as the Telstra dividends no longer end up in their hands.
    anonymous
  • Still a problem....

    Better options would be to fund the liability from higher taxes, or dilute the future fund ownership issues by acquiring diversified assets (ie via a wrap fund).
    Investing in Telstra shares only fuels the perception that the users are paying for public servant's super.
    anonymous
  • Not a problem

    If you bothered to read Carlos' comments you would have seen he clearly states the future fund was created using Telstra shares but over time they will dilute their holding and invest in other shares or assets. The easy short term solution was to move the government holding in Telstra into the future fund to kick start the fund. The future fund was created because without it the aging population will put huge pressure on future governments when public servants start retiring and want their super.
    anonymous
  • Users pay

    Basically the future fund was established because successive governments failed to budget for employee entitlements. It is relying on investment return to fund the liability, however because most of the portfolio is currently Telstra shares, it is a monopoly (or close to) & the government has significant regulatory influence.
    I repeat, this arrangement only fuels the perception that the Australian users are paying above normal rates because of Federal Government incompetence in funding employee entitlements.
    A private company doing the same would be sued & directors jailed.
    anonymous
  • Once again for the dummies

    No matter how loud I speak, if you do not want to listen you will not hear.

    The current holding will be diluted over time; if the government dumped $20 Billion of shares the sharemarket would have not absorbed the additional cash requirement well. The future fund holds a large amount of shares for the same reason the government allowed two instalments of the T3 payment, TO MAINTAIN OR INCREASE THE TELSTRA SHARE PRICE WITHOUT HURTING THE REST OF THE MARKET.

    Would you have been happier for the government to sell all shares in one instalment, be under subscribed and instead of getting $3.60 per share they got only $2.90 per share meaning a few $B less to the taxpayer's and into the future fund?

    I may hate the current government's policy regarding telecoms but I am happy they have planned far enough ahead to put some money aside for the public servants.
    anonymous