Peter Martin reports on the Coalition’s proposed amendments to the NBN legislation currently before the parliament. It’s a fairly transparent attempt to kill the financial viability of the NBN by effectively forcing the copper network to keep operating. The amendments would:
…remove the provisions which would exempt any agreement between between Telstra and NBN Co from the provisions of the Competition and Consumer Act.
This means that should Telstra and NBN Co agree to disconnect or remove the internet from the coaxial cable network used to broadcast FoxTel the ACCC would be able to intervene on the grounds that was an attempt to limit competition.
The tactical games also encompass the Coalition introducing an “NBN transparency bill” which would require the Productivity Commission to do a cost-benefit analysis of the NBN. If the PC is honest, all this is likely to reveal is that while the costs can be predicted reasonably accurately, the estimated benefits depend on how much you believe in the “broadband as enabling technology” story.
Beyond the tactical games, though, the Coalition does appear to be sketching out something approximating an alternative vision for the Australian telecommunications industry. Martin’s report suggests that the Coalition seeks the “voluntary separation of Telstra into retail and wholesale arms” (rather than the gun-to-the-head approach that the government has used). The government would then impose a universal service obligation of 12 megabits per second broadband on the wholesale company, and would provide subsidies to achieve this in regional areas.
This is almost a reasonable alternative proposal if you don’t think a universal fibre rollout is justifiable at this point in time (as noted at length in past posts on the NBN, I’m not convinced that it is). Given Telstra’s history since privatization, however, why would we have any confidence that the company would voluntarily do anything other than exploit its monopoly power to the detriment of the rest of us, leaving the ACCC perpetually fighting the last battle?
If Turnbull proposed the enforced splitting of Telstra into two companies, with one owning the copper and coax networks, the other doing wireless and telco retailing, this might have been a workable proposal. Until that happens, it’s still a recipe for the forced and long-term transfer of money from the telecommunications users of Australia to Telstra’s shareholders.