Why a Single National FTTN Network is No Answer (but Competition is)

Abstract

The government's conviction that there is a ‘broadband emergency’ has persuaded it to look for a single, national solution, a Broadband Big Bang. No one can provide that kind of solution more easily than Telstra. There are several problems with this. The rapid growth in broadband adoption over the past three years means it is far from clear there is a ‘broadband emergency’. Mandating a single technology is overly prescriptive and the particular characteristics of FTTN make it difficult to regulate an incumbent's technology. A single national roll-out risks a significant reduction in competition, whoever wins. This jeopardises the gains consumers have made where competition has emerged in the telecommunications industry. Ultimately, competition will probably only be embedded into the Australian industry by structural change, perhaps along the lines of the extensive facilities-based competition that exists in the United States between telcos and cable companies. Perhaps, eventually, someone will have to bite the structural separation bullet.