From show pony to dead horse

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.


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