Victoria slams ‘risky, uncompetitive’ NBN policy


Victoria’s Coalition State Government has heavily criticised the Labor Federal Government’s flagship National Broadband Network policy, arguing in a submission to a parliamentary inquiry into the NBN that the project could see the telecommunications sector’s existing “dysfunctional” market structure replicated and competition put at risk.

The new State Government had already been a critic of the NBN since its election in late 2010, confirming in December that it was planning to pursue an opt-in policy with respect to the NBN, rather than an opt-out policy which would see all Victorian premises receive the NBN by default.

In a submission to the Federal Parliament’s House of Representatives inquiry into the NBN (PDF), the State Government took its criticisms further. The submission was first reported by The Australian.

“The increasingly apparent risk is that the Commonwealth could, over time, fully replicate a dysfunctional telecommunications market structure that has hindered investments in the current broadband market,” the state wrote. “This would be the result if it simply replaces Telstra’s market power with an NBN Co infrastructure monopoly with all the attendant inefficiencies and constraints on investment, innovation and future policy making.

Furthermore, Victoria argued the NBN posed “substantial and serious risks” to the long-term development of competition in broadband markets, “potentially holding back future broadband investment, market development and innovation”.

Federal Labor had put in place “excessive” protections for NBN Co from competition, Victoria argued, such as signing deals with Telstra and Optus for the pair to stop providing broadband services over their HFC cable network and extending the NBN network into “upstream markets” such as the inter-regional backhaul market.

In addition, the Victorian Government criticised the Federal Government for regulations which would prevent so-called “cherry-picking” of the NBN, where potential infrastructure competitors could build infrastructure within viable areas already served by NBN Co.

The Victorian Government also echoed complaints by the Federal Coalition about the NBN strategy — such as the fact that many educational and health institutions already had access to fibre broadband, and so would not benefit from additional rollouts under the NBN.

Despite this, the state noted the importance of broadband in general to the future development of its economy, and noted that current broadband services were currently inadequate in some areas.
“Without sustained infrastructure investment, currently adequate services will fall behind community expectations within the next ten years,” it wrote, particularly highlighting the current market structure, dominated by Telstra’s ownership of the national copper network, as a problem.

The news comes as other states have taken differing approaches to the NBN. Labor-dominated Tasmania has proven a staunch supporter of the project, as has Queensland, while the new NSW Coalition State Government has yet to make its voice heard on the matter in any substantial manner.

Image credit: Jonathan LaRocca, Creative Commons


  1. You know, this news might actually be worth the hard drive it is stored on if it wasn’t just a replication of the Federal Coalition’s stance. Glad to know the party line extends outside of the Federal Arena, but please wake me up when Victoria actually addresses an issue directly relevant to Victoria, like VLine.

  2. Seems a “MY CAEK, ME EAT!” kind of statement. Most of the arguments are straight from the standard list of NBN complaints, but the statement around the inadequacies of broadband in many areas, and the problems caused by the Telstra monopoly are generally used by the pro-NBN crowd.

    I think NSW will basically leave the NBN argument alone for as long as it can – it won’t publicly support it, but it probably won’t stand in the way either, especially since they are trying to win in the ICT crowd right now, so the mixed messages may hinder that plan.

    • Right you are Jeff. Ted Baillieu really is a tool too btw, I remember him saying something not long after the state election about mobile coverage and how he would only support opt-out for the NBN if mobile coverage was improved for Victoria. yeah that one left us scratching our heads too.

  3. “We’re trying to prevent a fractured and dysfunctional market like the one we have currently!”
    Then why are you choosing an opt-in stance on installation?
    “Labor bad. We good!”

  4. Spot on Nightkhaos , how about they start following through with their promises and start fixing our disgraceful public transport system. Instead of trying to divert our attention from their own inaction. As a disheartened liberal voter I have come to expect constant whinging & inactivity from the party I have supported my whole life. I would prefer the NBN over no NBN, try paying for 20mbps and getting 1.3, living 10 minutes walk from CBD in Victorias 3rd largest city. I make my living online, which is extremely difficult with such poor broadband. A patch work of poor broadband across the entire city, do I keep moving house until I hit a winner? The state government should keep their mouths shut considering it doesnt affect state finances and it is another parties project. They are in a win win situation, the people they represent get A+ infrastructure and they cant be blamed for any fallout. They should be trying to assist in the rollout!!

  5. In NSW, I think Barry O’Farrell with stick with the studied diffidence he prefers when wanting to stand above the fray. They’ll make some noises and rehearse a few of the Federal talking points, but O’Farrell and Abbott are miles apart in temperament and approach, and there’s no political love lost between the two, either.

    I must say, with the future of the NBN rollout post-2013 looking a tad uncertain, I am seriously considering a move to Tasmania! How clever they were to get ahead of the pack.

    The Victorian Libs… they do appear to have taken their Ideologue-Strength Dynamite Power Pills. I do wonder how this will come back to bite them, being so openly hostile to an infrastructure that has the potential to draw major ICT companies to their State.

    • Is that the same as Australian Labor Government backs risky NBN rollout.

      Not Australia.

          • The term “Victoria” implies everyone, and to say that “Victoria” holds this view of the NBN is inaccurate, when this is nothing more than a statement from the government of Victoria.

            The federal Labor government is backing a plan they believe in, so they are hardly going to believe it to be “risky”.

            The only person to add the word ‘risky’ to the federal position on the NBN in regards to this article is yourself.

          • “and to say that “Victoria” holds this view of the NBN is inaccurate,”:

            Yes but you don’t actually know this, it’s just your opinion.

            “The federal Labor government is backing a plan they believe in, so they are hardly going to believe it to be “risky”.”

            Yeah that’s what they said about the insulation rollout.

            “The only person to add the word ‘risky’ to the federal position on the NBN in regards to this article is yourself.”

            That’s not true, it’s not just me, much independent financial and economic analysis has said the same thing, of course the big worry is wireless and the ever increasing disconnections from fixed line, Conroy and the NBN Co are so worried about it it got its own special marketing exclusion clause in the Telstra agreement for 20 years!

            Also Conroy is so worried about the FTTH getting enough customers he is prepared to give Telstra and Optus billions to shut down their working HFC networks so the NBN can get their customers.

            No of course not, the NBN is not ‘risky’ is it MW?

  6. My first reaction on reading the story is to allow NBNco to save a few billion dollars by excluding Victoria from the NBN build, the cherry picking laws and contracts with Telstra and Optus. Victoria can then enjoy the “long-term development of competition in broadband markets” and “future broadband investment, market development and innovation” without NBNco’s involvement.

    Wait, then it complained about how the current Telstra monopoly is causing a problem with degrading infrastructure, and will be unable to cope in a decade without new infrastructure investment?

    Do they want a private company monopoly or not? Do they want a new infrastructure investment or not?

    • lol I think the Victorian Government might have a wee geek revolution on its hands if it was decided that Victoria would be exempted from the NBN rollout …

      • Well if the no NBN rollout in Victoria was followed up with generous tax concessions for all Victorians for the next 25 + years as it should, maybe not, after all Telstra HQ is here I am sure they could come up with something, the most extensive FTTN/FTTH and LTE rollout in the shortest time in Australia perhaps?


          • Telstra has stated a lot of things, it doesnt means its going to A) happen, or B) be affordable

          • 99% of Australia is using Telstra for communications in Australia, none of it is affordable?

            That’s a hell of lot of people using smoke signals.

          • The ACCC has spent a lot of time on court fighting Telstra to keep prices down.

            There was on case in particular about the price ISPs paid to be able to put DSLAMS in that draged on for over a year IIRC.

            Can you recall an occasion where Telstra has been open to competition, or willingly implemented affordable prices (as opposed to as much as they can get) ?

        • Considering the last communications network company the government built not only paid back more than the cost of the build but then was sold for tens of billions of dollars more, I think Victoria should be paying more taxes to make up for not supporting the next one.

          And good luck getting the company that under-spent on maintenance on the copper network to pony up the cash to update it.

  7. Liberals are responsible for the current industry mess, and they still aint leant a thing.
    One wholesale network is the ONLY way to go in Australia.
    The competition should be in the retail space.

Comments are closed.