news The Coalition-led Victorian State Government has again sharply criticised the Labor Federal Government’s National Broadband Network project for not adequately meeting the needs of residents of the state.
In a submission to the Federal Government’s Regional Telecommunications Review this week (PDF) and associated statement by Technology Minister Gordon Rich-Phillips, Victoria said it agreed with Federal Labor that ubiquitous high-quality broadband and the development of the digital economy had the potential to drive important productivity gains and innovation across the economy, as well as boosting health and education outcomes. Like the Federal Government, the state said, it had established programs to support broadband infrastructure development and the uptake and effective use of high-speed broadband.
However, the state added, it was ‘disappointing’ that the early stage rollouts revealed by the National Broadband Network Company so had had not prioritised the regions in Victoria which had “the greatest unmet demand for broadband”. “The Victorian Government is concerned that disparities between regional and metropolitan Victoria may persist during this next phase of broadband development,” the state wrote in its submission, “and could potentially magnify the disadvantages of regional communities as their metropolitan counterparts enjoy accelerated benefits of broadband as the NBN is rolled out.”
During the last Federal Election in mid-2010, Federal Labor reached an agreement with key independents Rob Oakeshott and Tony Windsor on the National Broadband Network. The deal will see wholesale pricing equivalence apply between rural areas and the city. In adition, another aspect of the deal between Labor and the independents is that the NBN will be rolled out in order from the bush to city areas, rather than the other way around.
NBN Co’s early stage rollout plan for 2012 has seen Victoria allocated a variety of sites in both rural and metropolitan areas — ranging from Brunswick and Melbourne City to Tullamarine, South Morang, Ballarat, Bacchus Marsh and more.
However, in its submission, Victoria expressed its displeasure with both the locations of the NBN rollout in Victoria as well as the type of coverage being provided.
“The Victorian Government is concerned that the 93% fibre to the premises (FTTP) coverage objective is being implemented without a comprehensive strategic plan for how to best address regional needs,” the state wrote.
“It is important to note that the 93% national FTTP objective logically translates into a much lower percentage share of regional premises (closer to 80%), and that of these, some (as yet unknown proportion) will not receive FTTP infrastructure for up to another 10 years. The gaps in coverage and the length of the interim period before the completion of the NBN rollout are serious issues for regional Victorians and service providers.”
NBN Co, Victoria claimed, didn’t have a strategic plan for its rollout, and so was deploying the infrastructure indiscriminately with no regard to the benefits that might be derived from fibre (as opposed to satellite or wireless) being deployed to a regional hospital, school or business premises. “A better outcome would be derived from a more targeted rollout designed to capture economic and social benefits,” the state claimed.
In addition, the state said there was a “disproportionately low regional Victorian share of NBN Co activity to date”, and in some areas currently served by ADSL2+ broadband, NBN Co was planning to rollout wireless or satellite broadband as a replacement — instead of fibre.
“Therefore potentially, these locations could be stranded on the existing copper network with an uncertain infrastructure upgrade path and severely constrained service competition. Valuable service outcomes that could be realised by FTTP into these locations that host health and education providers may be lost.”
Furthermore, Victoria added, the rollout of the NBN would not solve the issue of mobile telecommunications in regional Victoria — with the network to focus on fixed infrastructure. And the state also warned — as the Coalition has consistently done throughout the NBN process over the past several years — that shutting down existing telecommunications infrastructure in the form of Telstra’s copper network established some of the preconditions for the development of uncompetitive market structures in the long term — as NBN Co will become the monopoly provider of last-mile broadband infrastructure.
Other issues raised by the state include education and the development of the digital economy.
“In the Victorian Government’s experience, the investments and changes required to drive the uptake and effective use of broadband are not trivial,” it wrote. “These include the development of new applications for the transformation of service delivery (both for new services and substitutes), investment in software, hardware and IT platforms, human capital development and business process, behavioural and organisational change.”
“The cost of accessing the NBN service is only one component of the total cost of designing, implementing and sustaining a new broadband application over time. This is particularly the case for the implementation of applications that require significant business change or innovation.”
It’s not the first time the Victorian Government has sharply criticised the NBN project.
In December 2010, Victoria’s technology minister Gordon Rich-Phillips confirmed the state’s fledgling Coalition Government did not support the introduction of Labor’s preferred ‘opt-out’ model for the National Broadband Network, in a move that will force residents to actively choose to receive fibre infrastructure when the rollout hits their neighbourhood, potentially limiting the NBN’s take-up in the state in the medium-term.
In June last year, the State Government argued 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. And in October 2011, Rich-Phillips issued a media release demanding the state’s ‘fair share’ of the NBN rollout.
I don’t regard most of Victoria’s criticism as legitimate.
For starters, NBN Co’s rollout schedule makes it clear that Victoria is getting a fair whack of early stage NBN infrastructure in the near term. The Federal Government has already substantially addressed the issue of regional areas needing broadband by setting a policy of rolling the network in from the bush to the cities during the major rollout phase from about 2013.
Victoria’s statement that the NBN will not aid in solving mobile coverage in the bush is factually inaccurate. The rollout of competitive backhaul to rural areas and fibre in major city areas can’t help but help the bush get better mobile coverage, and this is an area which has been improving for years, with not only Telstra but also Optus and a rejuvenated Vodafone adding rural coverage on an ongoing basis.
Victoria’s right about there being an issue with some areas currently being served by ADSL and about to be downgraded to wireless or satellite. However, I am confident that NBN Co’s extended fibre rollout plan — which allows local residents and businesses to club together to help fund the fibre to be extended to their area — will address some of these problems, and there’s nothing to stop the Victorian Government itself from chipping in to fix some of these problem spots as the rollout goes on.
The State Government’s claim about the early stage zones not being targeted well is also basically invalid. Right now, with its early stage rollout, NBN Co is not predominantly attempting to fix broadband blackspot areas. It is rather attempting to test its NBN rollout skills in as diverse a range of areas as possible, so that when it ramps up to full deployment mode in 2013 and for the half-decade beyond that, it will have all deployment cases down pat. Sometimes, as in the ACT suburb of Gungahlin, it can fix broadband blackspots along the way — but it’s not a major policy objective right now.
As for the competition issues … these have been beaten around the bush for many years now. I don’t think the Federal Government is going to pay any more attention to them being raised now than the last two billion times they have been raised ;)
Image credit: Still from Gladiator