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The Australian Broadband Disaster
David Gerard writes "Monopolies are bad, mmmkay? Robert Clark of TelecomAsia discusses the disaster that is broadband in Australia - its 2% takeup putting Australia behind such dynamic economies as Estonia. 'Telstra controls the local loop, is the largest mobile carrier with two digital networks, is the largest retail ISP, the largest wholesale data and Internet provider, and is a 50% shareholder in the biggest pay TV company.'"
Australia is a classic case of why monopolies in any industry should be avoided.
The most recent broadband fiasco here in Oz concerns itself with Telstra (who handle ALL submissions for ADSL in Australia regardless of ISP) deliberately telling competitor signups that they don't meet broadband exchange requirements, then signing them up under Telstra where they suddenly just scrape in.
Then you have the woeful bandwidth limitations (imposed mostly because Telstra controls the phone lines and resells bandwidth to every other ISP by the MB).
The ONLY point I will concede to Telstra is that due to our huge, continent scale country, upgrading ALL exchanges can be cost prohibitive, however to not have broadband capability yet in large POPULATED regions is unforgiveable in 2003.
In short, Telstra as a RETAIL company should be split from Telstra the NATIONAL INFRASTRUCTURE company. Make the infrastructure company publically owned, then Telstra (Retail) can compete along with everyone else on a level playing field.
Quizo
Visceral Psyche Films
That's a Berlusconi waiting to happen...*shudder*.
-- Waht? Tehr's a preveiw buottn?
The fundamental problem is that Telecom NZ is a private company, and as such, is *required* to return a profit to its shareholders.
On one hand, people scream and moan about outrageous DSL pricing structures, but on the other, those people who have invested in the company absolutely love what it is doing to the value of that investment.
In addition, TCNZ is one of, if not the biggest, companies in the country. The government is quite understandably scared to step in and do anything, because of the economic ramifications of playing with the source of such a large part of their tax income stream.
I don't know if this is true of Telstra as well, but I suspect it is.
It would be good, however, if the governments applied more pressure for the Telcos to use money they get charging city dwellers much more than it costs to provide a service to subsidise internet in the country areas. (This has happend with voic e lines for years).
Oh, we have cable. Two cable networks, in fact. Owned by the two largest phone companies. Who are not interested in allowing competition.
Telstra have to allow other companies to re-sell their DSL connections, and this is in fact very common. However, for some unknown reason, all the ISPs outside of Western Australia are run by total morons. (Except, recently, for Swiftel - who originated in WA anyway - and Comindico.)
Rather than peering with each other and purchasing cheap international bandwidth, they connect to Telstra, pay huge bandwidth charges, and pass these on to their customers.
Either that or they just choose to rob their customers blind (and still can't make a decent profit). It's impossible to get a clear statement of where the money actually goes.
Pacific Internet, my ISP, also provide services in Hong Kong. There I can get a 6Mbit flat-rate connection for HK$288 per month - about A$55. Compare that to the Australian offering of 256k, capped at 500MB per month for A$45.
That's nothing...
While dictating whatever price it wants to consumers certainly fits under the umbrella of monopolistic and confiscatory behavior (OK, behaviour) it's still not as stifling as a monopoly that has enough influence in government to kill off its competition by obtaining preferential legislation.
Now THAT kind of monopoly is hard to get rid of. If Telstra does that as well, then my apologies and consolations.
Yeah, right. Me, myself and I? In Estonia, they are far ahead of Finland when it comes to technology usage growth and even usage per se.
Ever heard of Wi-Fi in Finland. Go on, check out www.wifi.ee
Maybe if you weren't so drunk everytime you go to Tallinn you would've noticed this...
I beg to differ my friend. http://www.itnews.com.au/story.cfm?ID=6841 http://whirlpool.net.au/article.cfm/304 http://whirlpool.net.au/article.cfm/300
Look, it's all very well to bag out the ISPs capping usage or charging usage fees to go over it, but what you don't say is that every ISP has to pay for it's bandwidth, and it's charged by usage as well.
Most data comes from the US. In the US, that's easy, but when you need to go half way round the world to get the info then it costs money! You think the people that lay the trans-pacific cable just let anyone use it for free?
The other reason that the caps were implemented were that the ISPs discovered that 90% of their users were under them, and the other 10% were over them by some ridiculous amount. I know there are legitimate uses for it, but by and large the only thing it restricts are the warez and movie/music distributors.
-- james
The chief use in the US for garages is to park your car in them. However, it's astounding how many world class enterprises started in them. The national importance of cheap bandwidth is not for the day to day porn downloader but for the one in a thousand who take that resource and create a viable business out of it that ends up creating jobs and growing the economy.
Expensive bandwidth shaves off some growth every year at the margin and over time that creates a meaningful difference in the quality of daily life for you and the next generation.
This argument has been repeated over and over again. I don't deny that bandwidth costs money but if Telstra can profitably offer 3GB for around $70 including any service charges, how the hell can they justify charing $140 per excess GB?
Oz is a landmass equal to the USA, but with only 18million people. We are able to enjoy the outdoors for most of the year, so more people have a life away from fkn computers and the internet. It costs more to install bacause of lower population density, and the example of things better in the USA are often only based on local or regional prices, and not on national prices. ADSL will only work over 4 kms or so, on ggod copper pair, while the average distance for a suburban customer is not much less than that, so someone will miss out. The monoply is shrinting, but the returns are too low for other companies to take up the slack. The originator and Wirlpool distort the story for their own benefit, try to get more facts before posting crap!
There was an unknown error in the submission.
I remember back in high school, there was this economics simulation game we all played in class where every team owned a pen company and competed with the other teams. One of the first lessons that we learned is that 1000 pens at $1 each actually nets you mor emoney than 1 pen at $1000. It sounds like they should be the same, but in the $1000 pen case, you either get it all, or get nothing, but in the $1 pen case you can still make some money even if you don't sell everything.
The problem is broadband in Austrailia is that the monopolies cannot understand this fact of business.
The current population of Australia is about 20 million people. So at a 2% adoption rate, even if they could really, REALLY gouge thier customers at say $500 a month(!) then they stand to gain $200,000,000 a month, gross. Now, if by charging $25 dollars a month they could get a 50% adoption rate, then they will actually make $50,000,000 MORE a month than they did charging $500. That's a 20% increase in income and a 2,000% decrease in price! Everybody wins!
That's right, you can charge less of a price and still make more money, it really is possible... Even a hard core monopoly should at least care about making more money. If you can make more money as a company AND provide better service to more customers, then do it! It is absolute blind, and stupid, greed, and probably a little misanthropy mixed in for good measure, that they don't spend a few days to crunch the numbers and actually see that it's possible to make more money and more happy customers doing things a different way.
"However, I don't think this is actually negatively affecting anything of importance. The major use for home broadband throughout the US is "piracy" -- and while I have no firm moral position on this, I don't think it's a good reason to demand cheap broadband."
Now there's a well researched and thought out statement if I ever heard one. What are you, a mindless believer in whatever the RIAA says (even though I assume you're in Australia)?
Really, it's stupid generic blanket frames of mind like this that are giving the goons trying to tie down all digital media an audience in the circles that matter. I have DSL (in the U.S.) and wouldn't trade it for dial up for anything. This is because of the speed of web surfing and being able to watch online streaming videos and other multimedia content, not to mention downloading the latest ISO's and other software. Downloading pirated media is not a concern of mine, or of most of my aquaintences who have some kind of high speed internet link.
I believe that if realistic statistics on pirating using the Internet were generated, instead of statistics that were dreamed up by a bunch of RIAA flunkies sitting isolated in a conference room, you would find piracy rates to be related by specific age groups and demographics rather than be related to type of Internet connection. Also, I think it's almost a certainty that the piracy rates would be lower than the RIAA wants the masses to believe.
I also find it amusing that, right after admitting that you don't do many of the things you would like to do online because of the bandwidth caps, you make the statement that this hasn't negatively affected anything of importance. It's the grass roots, "let's try this out", projects that produce some of the most interesting ideas and software. By your own admission, excessive bandwidth caps stifle this.
Additionally, what about all those kids that would like to do those things, gain the experience and learn, but who can't? Where's the next generation of geeks coming from? Perhaps not from the realm of personal experience and wonder, but from the MSCE classrooms of the world, which is unfortunate. In my experience, those with computer "book learning" are much less capable than those who also learned their skills by trian an error.
I remember back when compuserve was the only choice for service providers that I remember, and their rates were roughly the cost of long distance for 300 baud. 10cents/min or $6.00 an hour. 135KB/hr or 2.250KB a min, which was toughly 10 cents. That is the highest cost I've personaly experenced transfering data with the exception to a BBS system in estonia. International operated assisted calls are a pain, esp when they don't understand you're trying to talk to a modem.
Correct me if i'm wrong, but can't get unlimited downloads over 56k lines? It is just broadband that's metered?
The reason why I ask is because you can actually get a single CD iso distrubution in roughly 24 hours assuming you have an ideal 56k connection. It's a pain but can be done.
I will agree that most of american broadband does not meter. There are some exceptions to this generalization, there was a choice for an ISP offering 1.5mbit/384K but their service was metered at pennies a gig, but I decided no way. It was US$50 monthly for the metered service, or a more national mainstreem ISP for $50 a month without metering.
There is no sanctuary. There is no sanctuary. SHUT UP! There is no shut up. There is no shut up.
Well, actually this is the same situation we have in Spain:
Telefonica controls the local loop, is the largest mobile carrier (Movistar), is the largest ISP (forked Terra and now is buying it again), is the major shareholder of Grupo Admira, wich controls the biggest pay TV company (Via Digital) and part of several media groups.
And now, for something completely different...