Australia Connected ... a political football?

The government's Australia Connected program, it appears, is no longer an altruistic and long-overdue investment in Australia's infrastructure, but a political football whose primary purpose seems to be to send a massive "nyah-nyah" to the Labor party.

Such is the price of progress in an election year. Less than 24 hours after announcing a program that will change Australia's telecommunications industry forever, this very significant investment is already being weighed in terms of its political capital.

Consider what has happened here: Australia's government has finally removed its proverbial finger and launched a forward-looking plan to stimulate investment by carriers who just haven't seen the point thanks to Telstra's stranglehold on the last mile.

Nonetheless, with nearly AU$1 billion for Optus-Elders joint venture OPEL to fill out an alternative wholesale network, we are finally seeing an initiative that could break Australia out of the Telstra doldrums. If nothing else, Telstra may have to actually switch on all those ADSL2+ enabled exchanges that are sitting fallow while the company waits for competitors.

Pundits will be dissecting the policy for weeks to come, but two aspects of Australia Connected (the government's bush broadband policy) deserve special note.

Firstly, WiMAX wireless broadband technology is an excellent way of bypassing Telstra's crumbling regional local loop infrastructure. Australia will finally begin catching up to Taiwan, Korea, India, Pakistan, and myriad other countries that long ago figured out WiMAX was important.

Absolutely nobody will be able to connect to the networks at first, of course, since WiMAX gear isn't exactly common. But this will change quickly. Intel recently abandoned its 3G efforts in favour of a WiMAX module it will ship later this year. A WiMAX / Wi-Fi module due next year could well do for WiMAX what Intel's now ubiquitous Centrino chipset did for Wi-Fi.

The second exclamation point of Australia Connected is its pricing -- from AU$35 to AU$60 per month. This is less than most broadband services out there today, and should help the infrastructure reach critical mass as customers abandon their ISPs for faster, cheaper services.

If Australia Connected can actually put these services in the market at those prices, Telstra will have to stop pretending it can control the market through price-fixing and government-bullying.

There is now even less to like about Telstra's pledge this month that it would maintain a AU$59 per month -- 512Kbps -- wholesale service for 14 years if it won the regulatory changes it is asking for. Such a service is laughable now but would be absolutely irrelevant if Australia Connected plays out as expected.

Although it's certain to face its share of obstacles, Australia Connected is a fantastic development -- on par with drought-breaking rains continuing into their sixth month or Paris Hilton's coming release being postponed indefinitely after her stabbing a fellow inmate with the heel of a Manolo Blahnik. For the moment bask in the happy glow that is the promise of more bandwidth than you ever dreamed of.

Perhaps the most important lesson from all this, however, is what the launch of this program says about deregulation -- that it just hasn't worked as intended.

What do you think? Has Coonan the Broadbandarian changed the world of broadband for the better, or is this just more political smokescreen?