blog The debate about whether major telcos such as TPG, Telstra and Optus should be allowed to deploy their own Fibre to the Basement infrastructure to compete with NBN Co’s own planned network has raged on constantly over the past several weeks. Some commentators, such as Business Spectator’s Alan Kohler, believe the telcos must be restrained, to protect the profitability of NBN Co. Others, such as myself, believe that the rollouts would provide immediate benefits to consumers, and thus should be allowed to go ahead. So what does NBN Co itself believe? Well, according to ZDNet (we recommend you click here for the full article), NBN Co executive chairman Ziggy Switkowski told a hearing of the Senate Select Committee into the NBN this morning that the planned rollouts would be a major issue:
“We haven’t done the full economic analysis but the impact could be quite severe,” he said. TPG would likely target “high value” customers that could hit NBN Co’s revenues by up to 10 percent, he said.
As I wrote on this issue last week, this situation places Communications Minister Malcolm Turnbull in quite the tricky situation. On the one hand, the Earl of Wentworth is an avowed fan of infrastructure-based competition, and it is true that having multiple FTTB rollouts to apartment buildings around Australia would immediately bolster competition to consumers and deliver better broadband more quickly to those areas. On the other hand, one has to wonder whether the Minister should allow portions of NBN Co’s network to be overbuilt.
If the Coalition had stuck with Labor’s largely Fibre to the Premises NBN policy, of course, all this wouldn’t be an issue. Talk about unintended consequences. Setting regulatory frameworks can often be like this; you need to think through several steps ahead, especially when it comes to a long-term project such as building a national broadband network. Switkowski’s comments merely dial up the pressure on the Minister to make a decision on this issue, one way or the other.
Image credit: Parliamentary Broadcasting