Communications Minister, Senator Stephen Conroy, has used Australia’s falling OECD broadband penetration ratings as evidence that the National Broadband Network is needed.
The Organisation for Economic Co-operation and Development (OECD) ranked Australia as 18th out of 31 countries in terms of fixed-line broadband penetration. New Zealand is currently ranked one place above Australia.
“Australia is still lagging behind world leaders in access to broadband and is further evidence that Australia has lacked vital investment in fixed-line broadband infrastructure,” he said in a statement. “This report is further evidence that Australia cannot afford to stand idly by with our aging copper network and sub-standard broadband services.
“Australians have been poorly served by the telecommunications industry’s market structure but the Gillard Government is changing this.”
But a spokesperson for Shadow Communications Minister, Malcolm Turnbull, said it was remarkable for Minister Conroy to use these figures as a case for the Government’s NBN.
“In 2007 Australia was well ahead of the OECD average,” the spokesperson said. “Now we’re 1 per cent behind because investment in fixed-line has fallen behind because of the NBN.”
The spokesperson went on to state that it made no business sense for companies to invest in fixed-line broadband with the Government threatening to push them out of the market.
Minister Conroy’s support for the OECD figures come after the organisation criticised the NBN’s monopoly status in a November report.
“As the cost amounts to 3.25 per cent of the GDP, it also entails substantial financial uncertainties,” it said at the time. “While establishing a monopoly in this way would protect the viability of the government’s investment project, it may not be optimal for cost efficiency and innovation.”
The Government’s release of NBN Co’s business case is expected to occur at some point in the next two weeks. Although it is expected to back up Minister Conroy’s arguments, potential issues have arisen with the Australian Competition and Consumer Commission (ACCC) and its decision on the Government’s latest legislation.
Both Houses of Parliament recently passed the Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Bill 2010, which was needed to allow the structural separation of Telstra.