Broadband, Innovation and the NBN

When Libs came to power in 1996, less than half Australians were online, and then only on dialup (how did we cope?!). By the time they left, in 2007, most Australians had broadband. This was achieved not by Liberals themselves, but by private industry (though helped along by continued government de-regulation)

The repeated assertions – particularly by those too young to know what the hell they’re talking about – that market forces have failed; that private industry can’t deliver; that “things will go backward under the Liberals” is not only demonstrably false, but astoundingly ignorant.

Labor’s proposed NBN, at $43b, works out at around $5,000 per household. And that’s assuming it, unlike other ALP programmes, comes in on budget (and actually works). Furthermore, the centralisation of this network in government hands undermines the de-regulation – begun under Keating – which helped services advance to their present level (do you think we’d have what we have now if Telstra hadn’t been privatised, and still had a complete monopoly?!)

The Liberal plan still spends too much – but at least it attempts to encourage investment, competition and innovation in the private sector. I expect tech to be far superior in 10 years than to what it is today, regardless of who gets power… but if there is any policy that is “backward looking” – and going back to the bad old days of one (government-run) supplier with no competition – then it is that of the ALP.

/rant

20 thoughts on “Broadband, Innovation and the NBN

  1. I agree. Labor’s spending billions of dollars to deliver a service that millions of Australians will neither need nor want, using technology that may very well be obsolete by the time it is implemented. At least the Liberal plan has some scope for flexibility.

  2. Looking at twitter and other online forums, the volume of comments claiming that Libs are taking us back to the dark ages is obscene. Those in their early 20’s in particular seem to think you’re an “out of touch oldie” if you oppose the NBN… these people would have been at most 12 years old in ’96, and just have no concept of how far we’ve came – thanks to private sector investment and deregulation.

  3. I think a lot of people are attracted by the thought of big money being spent on them/their town/their region/their state, and the talk about higher internet speeds. It sounds superficially attractive.

    A few years down the track when the service hasn’t arrived yet – or if it does arrive, and doesn’t deliver anything particular new or exciting – and billions of dollars have been wasted, and Australia’s encountering financial problems because of it – well, they might look on the scheme rather differently.

  4. Thanks for the link Alex… I may comment on that thread myself later, but I’m rather exhasuted from talking about it already 😦

    It’s handy of EFA to give the policy overview, but rather outrageous the NBN gets a tick (when it will be destructive) and the market approach get a cross. Do that many people really forget how we got to where we are now? Do they really believe the market has failed in this area?

    Also, from the EFA link, it looks like Sex Party supports the NBN. This has eliminated any chance of my supporting them in the senate.

  5. Have we any analysis on the cost to the taxpayers of a billion being spent by government?

    There are collection costs, administration costs, the cost of analysis for such projects, budgeting costs and so on. I am of the opinion that it really costs big money for them to spend a billion, without even taking into consideration the cost to the public of the removal of those funds from what they might have been spent on had it been left in the areas it came from.

  6. Yeah you see this phenomena everywhere in political issues.
    People seem to assume that the government is a metaphysically given and forget it’s man-made. People are unwilling to perform the abstract thinking necessary to even consider the proper role of government and to understand the need for scaling back government intrusion. To most people, it’s incomprehensible to think of privitising health or education for example. For most people, it’s perfectly OK for governments to be giving rebates left right and centre, stimulating packages, heavily regulating or owning infrastructure and messing up our internet! etc etc

    Just today, I read another comment by some moron in the paper saying the last decade had proved that “capitalism has failed”!??!? Idiots like Rudd and the clowns at Per Capita push the same false argument. But note that they get away with it! Personally I’d be embarassed because saying capitalism has failed is the intellectual equivalent of tatooing “I’m an idiot” onto your forehead. I would bet the people who make these empty assertions couldn’t even define the concept capitalism. Many of these people are probably so intellectually stunted that they are beyond reasoning with, especially if they are too old to care about seriously examining their ideological beliefs.
    This comment shows just how prevalent ignorance and inability to think are in our society, especially when it comes to politics.

    What the world needs in politics, is a widespread discovery and acceptance of the principle of individual rights and the principle of non-initiation of force.
    The Liberals certainly won’t help here. In terms of the long term battle, the Liberals may even be more damaging than the hopelessly incompetent and destructive Labor party. Because the Liberals try to masquerade as being business friendly and pretend to care about classical liberalism while throwing out the principles of freedom and accepting compromising and populist approaches to politics.

    While certain commenters around the place may have sympathy for the Liberals compared to Labor, I think it’s important to keep in mind how bad both parties really are. The trend towards statism and the blind addiction to government force won’t be addressed by Australia’s major parties until it becomes popular to do so. ie: Politicians won’t initiate the significant changes modern government needs. Moves towards freedom will continue to be superficial and a case of 1 step forward 2 steps back. Politicians respond and follow the crowd.

    Regarding this particular election, I’m not sure whether it’s slightly better to vote Liberal or Labor. I can’t even be stuffed thinking about it considering my total lack of respect for most politicians in this country and the fact that I have a life to live and get on with.

  7. This article is spot on. However while where at it let’s recall a few pieces of history.

    When it came to mobile phones the Keating government legislated that the technology used must be GSM and Telstras AMPS network had to shut down. Picking a winner before the race had even begun. Telstra built a GSM network but then also later converted the AMPS gear to CDMA which then launched as a GSM alternative.

    The Howard government would later back a wireless technology called WiMax, something I was personally expecting to do well and something that may still do well, but mean time the market went with 3G data.

    When Howard was elected the Libs decided that dialup Internet was too slow and that remote medicine and online education require high speed services. They mandated that Telstra provide the option of basic rate ISDN to pretty much everybody that wanted it. Telstra spent a lot making the service available but nearly nobody wanted it and those that got it later found that it was incompatible with the emerging ADSL technology. Howard was picking winners before the race had even begun.

    Fibre is a brilliant technology. However so was GSM and ISDN and WiMax. Of course this time it will all be different. Yeah sure.

  8. Both Fleeced’s post and Terje’s comment #8 are great examples of why genuinely free markets would be superior to our current system of messy regulations.
    Particuarly the innovation stifling and waste caused by government intervention.

  9. Fair enough. But I’d also add that we need to fix the underlying incentive problem… where private companies are hesitant to invest in large infrastructure projects out of fear of future political risk (being over-regulated or nationalised).

  10. “Fair enough. But I’d also add that we need to fix the underlying incentive problem… where private companies are hesitant to invest in large infrastructure projects out of fear of future political risk (being over-regulated or nationalised).”

    Robosocialists would NEVER in a million years come to terms with such a basic fact of life. They can’t risk bursting that giant ego infused utopian bubble. Nobody likes having their phony belief system crushed, so the evil and stupidity must go on in the name of ego preservation.

  11. I’m over commenting about NBN. Maybe I spend too much time on the Age, but everyone thinks it just brilliant ‘cos it a bright new shiny thing provided by the government. The Liberals’ one must be bad ‘cos they’re only spending a seventh as much. This is what passes for intellectual debate.

    There was even the absurd claim that it will pay for itself because you wont have to maintain an ageing copper network anymore.

  12. Jim your article is probably great but I can’t read it with your massive bald face staring at me the entire time. It’s freaking me out man, and I’m sure I’m not the only one.

  13. LOL… Yobbo has a point. I did read (and largely agreed with) your post, but I must confess: I had to narrow my browser window down to eliminate your face… no offense 🙂

    It just felt like someone was staring at me!

  14. Big Brother Fryar IS watching out for us, keeping us on the straight and narrow path of Libertarian Orthodoxy. Don’t you feel safer already?
    As for Broadband, where are the broads? I want my fair share!

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