Wednesday, March 21, 2007

Broadband. Labor gets taken for a ride.

Thirty years ago Kerry Packer took the Coalition for a ride. Insisting to its leader Malcolm Fraser in 1977 that Australia was falling behind, he sold him on the idea of a national communications satellite.

The government-owned and built AUSSAT did indeed make life easier for Mr Packer. He was able to network his TV programs more cheaply. AUSSAT lost almost $1 billion and died as an unloved piece of “space junk”.

30 years on his son James Packer is doing it to Labor.

He has convinced its leader Kevin Rudd that Australia is being held back by “antiquated broadband infrastructure”. Labor wants to spend almost $5 billion putting high-speed broadband within reach of 98 per cent of the population.

The Packers wouldn’t be wanting to use taxpayers money to look after their own interests again, would they?

Rupert Murdoch backs them up... He is cited twice in Labor’s new policy document as an authority for the statement that broadband in Australia is a “disgrace”, and that "we are being left behind”.

Communications Minister Helen Coonan might be wiser to their tricks than is Labor.

She said yesterday: “Quite clearly they’ve got a vested commercial interest in selling their content, and they would like to do so on the back of some infrastructure that they don’t have to pay for.”

Labor’s policy document is a credulous one.

Try subjecting this claim, repeated with approval in the Labor document, to the “laugh test”. That is – try reading it out loud without laughing: “Broadband is just as necessary as water and electricity”.

Even if that was true it fails to justify spending $4.7 billion of taxpayers money to speed broadband up. Nine out of ten of us have access to broadband faster than 256 kbps at the moment, and it is being extended to most of the rest of the population.

Who would a public-funded increase in speed to 12 megabits per second benefit?

Labor says it would help small businesses - of a certain sort. It cites “graphic designers, software programmers, and architects transmitting fully rendered 3D models of buildings”. True enough I suppose, but it hardly seems to justify spreading the very high speed to the entire population.

It talks about education (although my eldest daughter seems to get her homework done with the broadband speed she’s got.)

And it talks about the wonders of blogs, youtube and myspace, - all of which are booming with our existing broadband speeds.

It doesn’t talk about the really biggest beneficiaries (except when quoting them and reports they have commissioned as authorities). James Packer, Rupert Murdoch and the Fairfax organisation want high-speed government-provided broadband in order to push television-quality vision into every laptop and PC. They want the government to pay for it.

Earlier this year Professor Joshua Gans of the Melbourne Business School examined high-speed broadband for the Committee for the Economic Development of Australia. He found no case for a government-funded national speed up. After reading Labor’s document last night he stood by that conclusion describing it as “massive overkill”.


Anonymous said...

So you are saying that people and businesses will not use this service, especially the ones that are on the slow ADSL or still on the old fashioned dial up? Some people can't even get access to internet services and this is 2007.

I think you are underestimating the frustration people are experiencing, expecially when you go overseas and compare the services of broadband, let alone the prices.
Equity for Equity.
I think its a winner.

Colin Campbell said...

This sounds similar to some of the things that went on in the US, where some of the large media companies tried to hijack the existing infrastructure so that they could preferentially shove their content down the tubes and into poor unsuspecting homes.

I think some kind of compromise is necessary. There has to be some upgrade to allow universal coverage at an acceptable speed level. I don't believe that it is as necessary as electricity and water, but it is nice.

Just get these worthys to join the alternate group (the not Telstra guys) that have proposed to upgrade the network. They could do it a bit cheaper that way.

Anonymous said...

you don't run a business!

We do not have broadband in Australia and we need it.

If you want to research you need it.
If you run any sort of business you need it.

Head out of the clouds sunshine.

Rudd appears to be as strategic as Latham without having to defer to the roosters.

Fringe said...

Check out this cost benefit analysis.

Optic fibre wins hands down.

pre-dawn leftist said...

Sorry Peter, cant agree with you here. The thing about broadband is that we dont yet know all of the possible uses to which it can be put, we only know some of them. Rudd is on to a winner here.

Anyway, who says AUSSAT was a failure?

observa said...

Some actual stats on demand for internet

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