Industry slams government's $4.7bn broadband tender

Industry slams government's $4.7bn broadband tender

The Federal Government's $4.7 billion next-generation broadband tender has met with scathing reviews from industry representatives, who claim the lack of regulatory detail raises alarming questions about the future competitive landscape.

The Department of Broadband Communications and the Digital Economy last week called for submissions to build the government's $4.7 billion Fibre-to-the-Node (FttN) network. The National Broadband Network is aimed at providing 98 per cent of the Australian population with access to high-speed broadband of at least 12Mbps.

Submitted proposals will be assessed by a panel of experts assembled by the government last month. It includes representatives from the Australian Communications Authority, University of Melbourne, University of Adelaide and Allphones. The panel will issue recommendations to the Federal Government by the end of the year.

One of the biggest concerns expressed by industry representatives is that the proposal doesn't specify the regulatory conditions to be imposed on whoever ends up building the network. Several claimed a nationally developed and owned network under Telstra, the likely winner of the contract, could create a monopoly on next-generation broadband services.

Members from the Optus-led G9 consortium, arguably the only potential rival to Telstra for the contract, are outraged by the proposal. Internode and iiNet which sit in the G9 consortium alongside Optus, AAPT, Macquarie Telecom, PowerTel, Primus, Soul and TransAct -- have labelled the proposal ill defined, uneven and biased towards Telstra.

"There are no technical specifications, no architecture defined for interconnection, access or service, and there is no regulatory framework to govern how different companies must deal with each other in relation to 'declared' services," iiNet regulatory affairs manager, Stephen Dalby, said. "There aren't even any 'declared' services. This is Telstra's proposal, first put forward in 2006. It has been adopted by government and scaled up -- it will allow Telstra to escape the regulatory constraints currently in place around a copper-based network."

Dalby said a review of process shortcomings and the resetting of timeframes were needed to ensure a good outcome could be achieved for the market. While supportive of Conroy's plan to deliver high-speed national broadband, local independent telco analyst, Paul Budde, said the FttN proposal was unsatisfactory because it didn't specify any execution plans and could lead to anti-competitive behaviour.

"In this situation you can't interpret it [the proposal] in any other way but that it's extremely favourable to Telstra," he said. "The proposal doesn't guarantee we will have a competitive environment. That will mean everyone has to pay higher prices and there won't be any innovation."

One major unanswered question is the future of the ADSL2+ network once a FttN network is rolled out. In a statement, Internode managing director, Simon Hackett, said the industry must preserve existing ADSL2+ services in parallel to FttN to ensure competition. Failure to do so will result in stranded investments, prolonged legal battles between parties impacted by the FttN tender around loss of past and future investment, and loss of competition, he claimed.

"Only the continued presence of competitive services in the market can provide sustainable protection against monopoly rent being ultimately extracted from consumers," he said in a submission to the expert panel overseeing the National Broadband Network.

IDC telecommunications analyst, David Cannon, labelled the government's FttN proposal "much ado about nothing" if the ADSL2+ network was maintained, but a detrimental change if the copper loop was cut.

ARN Survey on MSPs
ARN needs to profile the Managed Service Provider (MSP) in YOU!, so please spare a moment and TAKE THE MSP SURVEY NOW

Follow Us

Join the ARN newsletter!

Error: Please check your email address.



IN PICTURES: Klikon Solutions Charity Golf Day (+51 images)

IN PICTURES: Klikon Solutions Charity Golf Day (+51 images)

Klikon Solutions held a Charity Golf Day out at Macquarie Links in Sydney to help raise money for charities Ronald McDonald House and Save our Sons. ARN was onhand in blistering 39 degree conditions to witness all the worm burners first hand. Pictures by Allan Swann

IN PICTURES: Klikon Solutions Charity Golf Day (+51 images)
IN PICTURES: Exclusive Networks - 007 Spectre night (+18 images)

IN PICTURES: Exclusive Networks - 007 Spectre night (+18 images)

Exclusive Networks, in conjunction with LogRhythm and FireEye, held an event to focus on fighting cybercrime with disruptive technologies at the Hayden Orpheum Theatre in Sydney. As part of the 007 - Spectre film theme, guests were invited to attend in their best James Bond attire. Pictures by Allan Swann

IN PICTURES: Exclusive Networks - 007 Spectre night (+18 images)
IN PICTURES: ARN Roundtable - Data Protection in the Hybrid Cloud (+28 photos)

IN PICTURES: ARN Roundtable - Data Protection in the Hybrid Cloud (+28 photos)

This exclusive ARN roundtable highlighted the opportunities and trends in the data protection market, and how the industry has evolved; examined the unique challenges in the hybrid Cloud environment and the associated customer pain points, and highlighted the growing business opportunities for partners. It was sponsored by EMC. Photos by ARN editorial Director, MIKE GEE.

IN PICTURES: ARN Roundtable - Data Protection in the Hybrid Cloud (+28 photos) is a channel management ecosystem that automates all major aspects of the entire sales, marketing and service process, including data tracking, integrated learning, knowledge management and product lifecycle management.

Show Comments