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Proper fibre broadband is not a waste, but you need a little socialism to do it properly

​Relying on the market to roll out universal broadband is not helpful when it is easier for companies to focus only on the cities.
Written by Chris Duckett, Contributor on

Last Monday, my esteemed colleague Jason Hiner asked the question of whether fibre-to-the-premises broadband is a waste of resources as the next generation of wireless technologies appears on the horizon.

With the piece focusing on America, it failed to address the one option that those in the United States seldom want to bring up: Involving the government.

To overcome the lust of corporations to hit the next quarterly target by squeezing the very last dollar from ageing assets and instead roll out more future-proof technologies, a little government encouragement is needed in the form of monetary incentives or legislation.

Without this, private companies may be reluctant to use fibre-to-the-premises technology; when a carrier is sitting on decades of accumulated networks, processes, and systems, there will need to be a very good reason to throw them aside and start ramping up capital expenditure.

Google Fiber is one such reason, but even that upstart remained confined to the more profitable metropolitan centres and remained puny in landmass coverage terms.

There is no point in running down the path of smart infrastructure and digital interactions with authorities if the rural section of the community is stuck on outmoded systems, and governments can also enforce another important aspect to dealing with broadband on a societal level: Universality.

Broadband is a paradoxical beast once baseline speeds in double digits are attained as the benefits it can provide to society become proportional to the difficulty in reaching them, and this inversely impacts profitability.

Consequently, users end up in a situation where those who need it most often have to go without, or live with poor connections because it doesn't make economic sense to service them. Private companies will not willingly enter regional areas, because even if there is a very slim profit margin, it could take decades before the investment paid for itself.

Despite its switch from a 93 percent fibre-to-the-premises network to one that is officially "technology agnostic" -- which in essence means using cheaper and less future-proof fibre-to-the-node connectivity -- one thing the Australian National Broadband Network (NBN) got right was using satellite to reach its object of universality by covering the final 3 percent of the population unable to be reached with fibre or fixed-wireless.

This establishes a connectivity baseline of 12/1Mbps for anyone in the country, regardless of how remote or isolated they may be. Once the entire country is hooked up to the NBN in the coming years, application developers will be able to make a connectivity assumption that, while not blindingly fast, should be stable and is a decent improvement on the ADSL speeds users have battled with for years. And in the coming years, it would be much more helpful if the government-controlled NBN abolished its 12/1Mbps tier for the much more useful 25/5Mbps baseline across all of its technology.

If you look around the world at countries comparably sized to Australia, no other nation is aiming to hit complete coverage of their population -- because reaching the last percent takes a couple of billion dollars, and in order to make the service affordable to satellite users, they need to be cross-subsidised by city users.

It's the sort of decision that a government can make, but a company will not touch with a barge pole.

Smaller countries with a higher percentage of fibre in their fixed-line rollout than Australia, such as New Zealand and Singapore, have a substantial amount of private funding, but it is unlikely the fibre footprint would be as large without the public money injected into these schemes.

There's no technical reason why the United States could not quickly find itself in a similar situation to many other Western nations and have a national broadband plan, except for the small matter that the US seems to have a pathological hatred of governments, and, in particular, government ownership.

It's at such a point that Virginia is reportedly looking into the prospect of municipal broadband being such an anathema that it must be banned if private companies offer 10/1Mbps or faster plans to 90 percent of a footprint.

Until such trends are reversed, there will always be a section of America that is left behind on communications.

Sometimes, you need a government to take foolhardy, economically questionable decisions that provide for a greater societal good precisely because it makes no sense on a balance sheet or in a quarterly earnings call.

But for those worried that Australia is about to become a hotbed of government ownership and export it across the world, fear not; we always planned to sell it off at some point and let someone else drive it into the ground.

Check back in a decade or so when we are complaining about NBN's new owners not investing in new equipment and gouging customers whenever possible. You'll feel right at home.

ZDNet Monday Morning Opener

The Monday Morning Opener is our opening salvo for the week in tech. Since we run a global site, this editorial publishes on Monday at 8:00am AEST in Sydney, Australia, which is 6:00pm Eastern Time on Sunday in the US. It is written by a member of ZDNet's global editorial board, which is comprised of our lead editors across Asia, Australia, Europe, and the US.

Previously on Monday Morning Opener:

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