Fletcher wants Oz to learn from UK broadband policy


news In a new blog entry entitled “What can we learn from the UK?”, Liberal MP Paul Fletcher has lambasted the broadband policies of the Gillard Government, unfavourable contrasting them with the approach of the Cameron Government in the UK.

Fletcher starts off in the piece by pointing out the high amounts that Australia is spending to promote deployment of superfast broadband compared to UK and moves on to claim that the Cameron Government’s approach is much more pragmatic, flexible, private-sector oriented and competition-centred. Disapproving of government intervention, except where there is market failure, he is also highly critical of the one-size-fits-all approach of the Labor Government and is all for more tailored approaches with a mix of technologies.

The Cameron Government announced in December 2010 that it will spend £530 million (or A$1.23 billion) to promote the deployment of ‘superfast’ broadband (defined as more than 24 Mbps) in the UK. This amounts to around $20 per citizen of UK, whereas in Australia the cost comes around to $1600 per person, according to Fletcher.

Fletcher points out that the UK approach is to do it in stages, with the first commitment being to provide virtually all homes access to a minimum level of service of 2 Mbps by 2015. After the initial commitment is met, the government plans to promote ‘superfast’ broadband. In contrast, many Australian homes will have to wait well beyond 2015 for the National Broadcast Network (NBN) to reach their doors. Also, the Gillard Government by reaching for a highly ambitious goal of 100 Mbps is being foolhardy without a clear idea of what applications need that kind of speed.

In UK, delivering broadband is primarily a private sector matter. Government intervention is necessary only where there is market failure—in commercially less attractive areas like some rural and inner city areas. British Telecom (using a mix of ADSL, fibre to the node and fibre to the home) has committed that approximately two thirds of UK homes will receive fibre to the node (offering up to 40 Mbps) or fibre to the home (offering up to 100 Mbps) by 2015.

In Australia too, significant parts of the market will require public sector funding, but the Federal Government has taken an approach of pushing aside private sector everywhere — by funding a ubiquitous publicly owned fibre network. The Government is also paying Telstra and Optus to withdraw their extensive existing cable networks from service in spite of the fact that they can be upgraded to deliver 100Mbps.

Another point Fletcher makes is that UK policy, while recognising fibre’s pre-eminence, explicitly rejects picking technologies; it notes that other technologies including wireless and satellite should be part of the mix. In Australia, the Government is also using different technologies — fibre for the majority of the population, coupled with satellite and wireless in rural and regional areas.

Public funding in the UK, where provided, is being put in the hands of the communities and local authorities to use on infrastructure that suits them. A key design approach is to deliver ‘a central digital point’ in communities; in turn the local community will be responsible for extending the network to individual homes. A mixed technology approach will be taken, and local authorities will have a key role. This, Fletcher says, is a more flexible approach and more responsive to local needs instead of Labor’s one-size-fits-all centrally controlled strategy.

Fletcher also brings our notice to a report by UK communications regulator, Ofcom, which estimates that even though 57 percent of the homes were able to receive superfast services, less than four percent of them actually subscribed to it. This is significant as it suggests that consumer demand for superfast broadband is limited.

Image credit: Office of Malcolm Turnbull


  1. The trouble is Australia is not the UK.
    What happens over there is not relevant to Australia.

    • {The trouble is Australia is not the UK.
      What happens over there is not relevant to Australia.}

      Exactly. The UK is only about the same size as Victoria, but with more than 60 million people.

      If the Australian government only had to provide high-speed internet infrastructure to such a small area, and had the economy of scale that three times our current population would bring, then there wouldn’t be much of an issue.

      I wonder what tactics the UK government would be planning if their country was the size of Australia, and they only had tax dollars from a third as many people as they currently do? I reckon their strategy in that circumstance would probably involve a high percentage of dial-up.

      I think Australia (and our current government) is doing pretty well with the resources they’ve got to play with.

      Have a look at the US… about the same size as Australia, but with 13 times the population and a zillion times more money. And what do they end up with as a result of the non-government marketplace competition dream… a raggle-taggle mish-mash of technologies, where some people have great service while others don’t, and some people have affordable service while others don’t.

      That’s certainly not what I want for Australia.

      NBN… world’s best technology, appropriately delivered depending on your location, a minimum service level guaranteed to all Australians, available to all everyone at the same reasonable price, and competition for any ISP who wants to be part of it at the wholesale level.

      Sounds like a dream that even the yanks and the poms would aspire to… if they had visionary governments.

  2. Perhaps Fletcher should take a look closer to home, specifically at NZ.
    They decided that FTTN was not good enough and moved towards a FTTH rollout.

    The UK doesn’t have the problem of a vertically intergrated monopoly such as telstra.

  3. ‘except where there is market failure’: remember Sol and the cowboys Fletch? In the UK they still go down the pub and watch Murdochworld for entertainment when they are not being dragged off to detox in police vans. Who needs fast broadband when there is that sort of fun to be had.

  4. What no one seems to understand and no one ever seems to get.

    This is future proofing australia’s fixed line communications. It doesn’t matter if you want to do 2mbps, 10mbps. The fact is the “cable” going in the ground can handle much more.
    It doesn’t matter what applications may/may not have the requirement for it.
    It’s there for use in the future.
    No further upgrades will be required to the cabling unless it breaks etc.

    Wireless is reported to be at 1gbps within 5 years, still – it doesn’t matter.
    So many issues exist with wireless technology and users from vivid, even 3g users can tell you of their problems. Unless we install a lot more mobile infrastructure wireless for all will not be viable.

    Fibre to the premises is the way to go – just accept that it’s being done and get over it.!

  5. The UK has different regulatory structure with BT Local Network Structural Separated from the rest of the BT Group PLC(through Openreach please refer to http://www.openreach.co.uk) which has a regulatory oversight through the Office of Communication(or OFCOM)

    I have worked for both competitor and directly at BT Global Services so there was all these structural changes occurred while was over there between 2004 and 2007 when i eventually returned back to Australia

    Paul Fletcher and the opposition haven’t really addressed the structural issues within the Industry with there policies. There is no issues with calling the NBN a lemon but they need to address structural issues firstly then there ideas might work. The NBN with labour is a form of structural change but possibly not correctly implemented (with all the competitive carriers addressing concerns with Labour Policy)

  6. This will be good… a layman commenting on the NBN.

    “Disapproving of government intervention, except where there is market failure,… ”

    Which is exactly why we are building the NBN! The market failed to become competitive.


  7. Has the opposition forgotten that NBN mark 1? It is pretty much what they are describing now, but required the cooperation of the infrastructure owner, which was not available.

  8. “Fletcher points out that the UK approach is to do it in stages, with the first commitment being to provide virtually all homes access to a minimum level of service of 2 Mbps by 2015”

    Homes in the major Australian population centers already have access to 2 Mbps under ADSL 2+ plans. The NBN is supposedly being built from the most disadvantaged areas in to the more advantaged areas. The smallest number of connections that will be made on the NBN is obviously in the remote and disadvantaged areas. It is therefore not unreasonable to assume that by 2015 Australia will have virtually all homes with a minimum service level of 2 Mbps available which is equal to the UK aspirations pointed out by Mr Fletcher.

    Surprise, surprise another monster fail from the technological illiterate dinosaurs in the Liberal Party.

  9. Just like to point out, not only is out telecommunications industry completely different (structurally seperated BT vs Telstra etc.). Not only is our population density distribution different (we don’t have a london – I get it that on average we are close to the same, but we still don’t have a london-worth of density).

    But our economies and government positions are completely and utterly different
    Also, the UK is out of money. Their banks are about to fall apart. The EU next door is freaking out about *their* banks. They have high levels of unemployment and a good deal of unrest and government debt.

    Seriously, we get it. We are spending more money than other people. We totally get that. WE ARE AWARE, but, point me out a country with more money than us, NOT spending it on a system like ours, and I’ll show you country with nothing like our population density.

  10. A private sector matter? Okay then so were the precarious balance sheets of the UK banks. But they were nationalised by the UK govt? You can’t pick and choose when the free market should apply.

    We have not privatised our banks and our economy is strong, fiscal position is strong, AUD thought the roof and the GBP is being devalued to import prosperity… no comparison.

  11. So, whenever you have money, you spend it ? I’m not saying I don’t want the NBN, I do. I think it’s a great investment for the future, for education, business, health and personal use. Yes, the UK is in difficulty, as are Europe and the US. Are you really so naive to think this won’t affect Asia, South America and Australia ? There is a global recession coming. The rate adjustments from the Federal Reserve. Banks distancing themselves from the Cash rate. Bank’s overseas funding is rising and their making adjustments in their home market to reflect this. While most families and businesses are paying off debt in preparation of the hardship to come, the Gov’t that runs our country takes the decision to undertake the most expensive technological upgrade we’ve ever seen.

    I’m not a fan of Gillard or Labor in general – they’re more interested in catfights then actually running a Gov’t – I’ve not witnessed a lack of professionalism to that degree before. I also have found Abbott’s avoidance of such issues like Global warming and complete ignorance of Technology quite unerring.

    I don’t dispute Australia can afford this investment. It’s whether we should’ve spent it or not. I don’t feel there was enough debate regarding this and I certainly don’t feel Abbott’s attitude of cancelling this or the Carbon Tax if & when the Liberals were to come to power should be considered – it would be way more costly, it’s paid and done, let’s just get on with it.

    • “There is a global recession coming. ”

      That in itself is a brilliant reason to build the NBN. Recessions are exactly the right time for the government to borrow money to build infrastructure that is not immediately needed, but will be useful for the boom time after the recession. It helps cushion the economy by injecting jobs and investment at a time when the private industry is pulling out of jobs and investments. Remember the NBN is a 10 year build. So if you think the recession is coming some time within the next ten years, the timing could not be better.

      “I’m not a fan of Gillard or Labor in general – they’re more interested in catfights then actually running a Gov’t ”

      I think that applies to both parties. The Gillard/Rudd incident is mirrored by the Abbott/Turnbull incident. For every indiscretion on one party, there is another from the other party.

      “I also have found Abbott’s avoidance of such issues like Global warming and complete ignorance of Technology quite unerring.”

      You mean unswerving instead of unerring? And front-on confrontation rather than avoidance? Remember that Abbott’s rise to power is due to the global warming issue, so he did not avoid that at all. Neither did he avoid the technology, since his liberal core values as he revealed to Oakeshott was “no on climate change and no on national broadband network” (http://www.theage.com.au/opinion/politics/gillards-insurance-policy-20110916-1kdz7.html). He did not avoid either issue, he took on both of them head on marking them the only two non-negotiable issues.

  12. Vital national infrastructure does not belong in private hands. Another Telstra anyone? There is still ample room for the private sector to connect consumers. Steven Conroy, following in the footsteps of Richard Alston, is the biggest hindrance to fast broadband in this country.

  13. A lot of people seem to be overlooking that in Britan – Super Fast Broadband >24Mbs is being delivered ny Enhanched ADSL , not fibre. If you want fibre many 100’s of pounds need to change hands. SO Super Fast Broadband >24Mbs is still fibre to hub.

    • FTTN requires the cooperation of the infrastructure owner. That exists in the UK with OpenReach. It does not exist in Australia, with Telstra fighting tooth and nail to keep control of their monopoly.

      If we were to go down the FTTN path, we would effectively lose even the existing competition in broadband, with all plan costs rising to “off-net” TW pricing.

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