Basslink cable owner CitySpring this week said negotiations to switch on the undersea fibre-optic cable to Tasmania were close to concluding, bringing hopes of increased broadband capacity to the island state.
Basslink cable owner CitySpring this week said negotiations to switch on the undersea fibre-optic cable to Tasmania were close to concluding, bringing hopes of increased broadband capacity to the island state.
(Spirit of Tasmania and curious children by 29cm, CC 2.0)
"It is certainly leaning towards a conclusion," a spokesperson
for Singaporean company CitySpring, which bought the undersea link in
August of last year, told ZDNet.com.au. "We're trying to create some creative solutions that will work
for everyone."
The comments come days after Tasmanian treasurer Michael Aird uttered similar optimistic sentiments about the talks, which have been held for some months between CitySpring, the state government and Aurora Energy, which will use its infrastructure to link with the undersea cable and other internet service providers.
A number of large ISPs (such as Netspace) have complained that the cable needs to be switched on to provide competitively priced data transmission to the state, which is currently only served by Telstra.
In response to prior accusations that the $2 million fee the
government has been paying to CitySpring for access to the cable
despite its inactivity has left little incentive to the company
to forge an agreement, the spokesperson said the company had spent
millions which won't see a return on a dark cable.
"We're working hard to get it active and have it lit," the
spokesperson said. "We wouldn't have spent the money or spent the
time if we thought it was in our best interests to have it
idle."
The issue has been receiving a lot of airtime this week, as Aird
said a result was edging closer.
"I am hopeful we are getting closer to a resolution," he told
ZDNet.com.au in an email interview. He was unwilling to
estimate a timeline for finishing negotiations, but said that the
government was doing everything it could to help reach a speedy
outcome.
"Improving broadband competition in Tasmania is the highest
priority for the government," he said.
Aurora Energy, the partner the Tasmanian government has selected
to commercialise the Basslink fibre-optic cable, has also been a
party to the negotiations, but declined to give any further comment
than the government had offered.
Proof needed Digital Tasmania,
a group dedicated to get Basslink going, was
glad to hear progress was being made, but didn't give the
assurances much weight.
A spokesperson for the group said that its members had heard
such words before. "We'll believe it when we see it," they
said.
His scepticism has been founded by a history of dashed hopes.
The government started building a fibre backbone for the state in
2003. In 2000, the government had selected Basslink to run
an electricity cable under the Bass Strait and lay fibre-optic cable alongside. In 2005, government
documents suggested that the cable might be operational by
2006. However, this never eventuated.
We'll believe it when we see it
Digital Tasmania
In August 2007, Singaporean company CitySpring Infrastructure
Trust, a wholly owned subsidiary of Temasek, completed the
acquisition of Basslink for over $1 billion.
Since that time nothing has happened, as the Tasmanian
government, Aurora and CitySpring entered and became bogged in
negotiations for an agreement about commercial terms of lighting the
cable.
"Unfortunately, the cost of bandwidth to Tasmania remains
appalling, as often happens under monopoly situations," Internode
MD Simon Hackett said in a statement in May just after making the
decision to stop offering some of its faster services in the state.
A ray of hope arrived in July as Basslink Telecoms
received a carrier licence from ACMA. However, the negotiations continued to
drag on until earlier this month, when Aird lost his temper.
Confronted by a question at the legislative council about the
cable, he said, "I know I am smiling on the outside — but I
am fuming on the inside."
He said he had written a letter with officers from his
department to lay the hard line down to CitySpring.
"It is not about talking tough," he said. "It is about trying
to get people to understand that, as they have an obligation to
their shareholders as developers of optic-fibre across Bass Strait,
we have an obligation to the community of Tasmania... That is why I
am running out of patience."
He said that commercial negotiations were fine, but to deny the
state the opportunity to further develop the economy was not.
"The time is nigh when we will be talking very bluntly and very
publicly about what is going on. CitySpring are on notice, Madam
President, that the government has nearly had enough of their
behaviour. I hope they will understand their obligations and our
obligations to half a million people because we want to be
connected to the rest of the world."
Although CitySpring was unable to confirm whether the letter
had arrived and said it wouldn't have changed much, the
spokesperson for the company did seem hopeful for resolution.
Michael Aird (Credit: michaelaird.org)
However, Digital Tasmania was not the only group which was
mistrustful of the positive statements, with Greens Leader Nick
McKim calling on the government to explain what has taken so
long.
"This unacceptable situation has been dragging on for a long
time, and the government owes all consumers of broadband in
Tasmania an explanation for the delays," he said this week in a statement.
"This situation is causing a significant competitive
disadvantage to businesses and let's not forget that it was this
government's incompetence which put us in this position."
If the Greens' pressure, along with Aird's determination and
CitySpring's optimism do signal the end of the long Basslink
saga, Tasmanians could see drastically reduced broadband prices. Digital Tasmania said that activation of the fibre-optic
cable could lead to reduced internet access charges for consumers
by as much as $15 per month through a reduction in wholesale costs
and an increase in competition.
Internode's Hackett agreed that prices would fall. "Telstra, as always, will drop their previously unmoveable
pricing to match any competitor that appears, and the result will
be two lower cost paths, not one," he told ZDNet.com.au.
"That is how monopolies work — they take 100 per cent of
a market while they can (at prices way above commercial rates on
competitive routes), and once there is a second path, they lower
their price to maintain their market share at no lower than 50 per cent by
price-matching the new entrant."