I’ve been meaning to write something about Helen Coonan’s new communications policy but John Quiggin has beat me to it. Perhaps I’m still fuming about buying a digital set top box that doesn’t do anything particularly well, and more so because the body corporate in my building would have to agree to do something about the antediluvian aerial that all of us share, but it’s equally open to us to get angry about the restriction on content that totally contradicts any notion of consumer choice. I haven’t read Coonan’s discussion paper, but I’d be really interested to know if there’s even a pretence at justifying the racket to protect big media in terms of the public interest.
And don’t even get me started on the slow broadband speeds compared to other countries. I’d have to make the point that this puts a barrier in the way of people who might like to download tv programs from the internets!
The policy is a cosy deal between the government and the media monopolies it has created through the grant of TV and radio licenses, and through the half-public, half-private chimera that is Telstra. The interests of the Australian public in diversity, choice and competition have been disregarded completely.
Elsewhere: Via Laura in comments, David Tiley’s excellent post.
Not to mention how comparatively expensive Aussie broadband is. This only makes the disparity of speed more insulting.
I am sure somebody knows more about this than I do but I am sure I’ve read that broadband in Australia is not ‘true broadband’ but ASDL: there is a difference I’m told. Apparently we are WAY behind in broadband technology here.
The speed of my broadband, for the rest of this month, is about to drop to near dialup speed because I have almost exceeded my ‘unlimited plan’s’ limit (how do they get away with calling these plans unlimited? Where’s Prof Fells when you need him?).
And don’t even get me started on the slow broadband speeds compared to other countries.
Mate I just dream of getting broardband , all I can get is slow dialup ..and I am only just outside Brisbane
Yep. Your right 110%.
If only you saw IR in the same light (union monoplies and captured capital), the dark side would welcome you with open arms.
Don’t get diverted, this has little to do with digital stuff. Its about creating media monopolies combining print, TV and radio in one horrible propaganda and cross promotion machine.
Then flogging the whole echo chamber off overseas. Oh, that’s right, subject to a ministerial decision about the national interest.
This is the biggest story since the Iraq War, much bigger than the AWB.
One of the biggest beneficiaries of this has been the Packer family. The late Kerry didn’t deserve a State funeral. He was no entrepreneur, but a rent-seeker. Say what you want about Microsoft but at least Bill Gates didn’t rely on government privileges to create a monopoly. It was all made with ruthless cut and thrust in the marketplace. Sad but very few major Australian entrepreneurs have not had a hand up through government regulation.
I think a lot of people need to have a cold shower and think about things a little more.
the new legislation does open the markets a little more.
I can’t honestly understand Quiggin’s logic in all this other than hoping people would forget what he has said previously.
If one believes that a more competitive market helps deliever better , cheaper products and I don’t think many would disagree. Than how does a person suggest that Telstra ought to be re-nationalized as he has done recently.
If any of you disagree with the sale of Telstra, then you shouldn’t be critical of the government’s attempt to dereguate media ownership. And no they aren’t two separate things because government ownership of Telstra made us into a late comer to the party.
Totally agree Jason. There is a lot of truth as to how the rich have mnade their money here. Though not all.
Ron Walker is a great example of that.
The evidence is anecdotal but I think there is a good % of broadband users who download TV shows. Given how the networks treat their viewers I am not suprised.
David T. is too modest to link to his own extremely interesting post on this topic -
http://barista.media2.org/?p=2455
Go read.
Say what you want about Microsoft but at least Bill Gates didn’t rely on government privileges to create a monopoly
Not too sure. Wasn’t IBM bundled with MS-DOS mandated by governments?
Try introducing MACs into a government department or even free OpenSource software.
JC, I fail to see how a set of laws that reduces the level of media ownership diversity, while retaining arbitrary restrictions on media operators like how many networks there can be, opens markets.
Thanks, Laura, I’ve added the link to David’s post up above.
We recently got high definition digital TV and a reasonably large LCD flat screen. The combination certainly makes viewing a much more satisfying experience, especially for movies and sports events (the latter are mostly recorded in HD these days). You also get ABC 2 with digital, and sometimes the ABC HDTV station has different content than the ABC digital low definition digital station, so you sort of get 2 1/2 ABC stations.
I mostly agree with JQ’s article, however, and in particular his conclusion that Coonan’s proposed new rules are just more of the same regulation intended to further favour the existing big players. Although I suppose Tony O’Reilly or someone might conceivably be a buyer for Fairfax or Channels Ten or Seven, which would at least avoid further concentration of the existing market dominantion of Murdoch and Packer.
As for JC’s disparaging comment about JQ, you presumably haven’t carefully read John’s arguments. He advocates re-nationalisation of the monopoly aspects of Telstra i.e. its fixed line and exchange network. That is quite consistent with liberal principles, and quite unlike the situation with media companies (which aren’t monopolies although they’re tending in that direction). As you would know if you’ve followed Telstra’s attempts to screw other phone companies and ISPs, you would realise that a privately owned Telstra that almost entirely controls fixed line and exchange infrastructure, while competing with other companies forced to utilise that infrastructure, is a sure recipe for anti-competitive behaviour on Telstra’s part, behaviour that can only get worse once it is fully privatised and no longer needs to make even a pretense of being a responsible corporate citizen.
Ron
ADSL can be “true broadband” if exchanges are upgraded to ADSL2 standards. This is already beginning to happen in the bigger capitals and there will probably be quite substantial coverage within 12-18 months (although with large gaps and lots of people still affected by having “shared pairs” or RIM problems (claims of which by Telstra staff who can’t be bothered offering you a broadband service are sometimes but not always garbage).
Mark
Finally, even with “ordinary” 512k broadband, you can download recent release movies, TV shows etc within a fairly reasonably time right now, using P2P software like Bit Torrent. At least you can if you don’t give a stuff that you’re almost certainly breaching copyright by doing so.
oops I meant ADSL2 .
Actually ADSL 2 plus (it appears that Wordpress deletes the plus sign).
Ken, I have to get someone to show me how to use bit torrent - so I can use it for strictly legal purposes
“Try introducing MACs into a government department or even free OpenSource software.”
The Dept of Veterans’ Affairs advertised last year for expressions of interest to supply open source software for their thousands of PCs. I have no idea what the result was.
Ken,
I guess I’ll be waiting a while for an upgraded exchange as we only got an ASDL stage 1 upgrade last year.
What Ken said about Telstra an infrastructure provider. It’s a situation roughly anologous to the road network. Imagine more and more main arteries not just privatised but refusing to let your truck through ‘cos it’s allied with a competing consortium.
Also broadcast and networked packet distribution systems are fundamentally different and any attempt to legislate a commonality of content providers is a complete category mistake.
“re-nationalisation of the monopoly aspects of Telstra i.e. its fixed line and exchange network”
Which is the way it should have been done in the first place.
“As for JC’s disparaging comment about JQ, you presumably haven’t carefully read John’s arguments. He advocates re-nationalisation of the monopoly aspects of Telstra i.e. its fixed line and exchange network. ”
It is not consistent with Liberal principles. What a great idea it would be then. Let’s renationalize Telstra and force it become captured captal of the unions all over again.
Ken, he also thinks the telco was more efficient under the control of the unions. Disparaging, who needs to be when the words speak for themselves.
I repeat these aren’t Liberal princilpes, if they were the government wouldn’t be tryig to sell it off.
JC, please actually read the comments. John Quiggin proposes that the infrastructure and the network be in public ownership which would then provide the basis for genuine competition between telcos, rather than the position at the moment where they have a huge anti-competitive advantage as the owner of the network. It’s indefensible from a position which supports competition and a market with any sort of level playing field, as evidenced by the enormous amount of regulation and indeed litigation with the ACCC.
It’s very clear from numerous comments that you’ve misread Quiggin’s position.
Mark
I have understood exactly what Quiggin is up to. As I said before under his “proposal” the elements going back to government ownership would end up being the plaything of the public employees unions like everything else under public ownership. It’s called captured capital.
More pertinently it would be just plain silly. Even Telstra is talking about most of our telco going wireless over the next 5- 10 years or so, which is one of the great issues facing the firm. In other words how are they going pay for this new system?
So going forward Telstra realizes that the age of the copper wire is close to done. So now you, along with Quiggin and Parish are suggesting the Australian people get lumbered with a bunch of copper wires that could easily be next to useless over the next few years. And if labor ever gets in (heaven forbid) would the unions (like they tried in the 80’s) attempt to prevent the introduction of new technology to “help the membership�. You friggin bet they will.
The US has a similar situation to us where the Baby Bells own the local exchanges under close supervision of the FCA. It hasn’t seemed hamper faster tech going through the wires over there. Maybe that’s because they don’t have a half baked government ownership system like we do where the government still owns a big part of our telco. Some who ought to know better are proposing the important bits go back to the government… errr unions again.
“It’s indefensible from a position which supports competition and a market with any sort of level playing field, as evidenced by the enormous amount of regulation and indeed litigation with the ACCC.”
If this were true the US having the same issue of copper wire ownership would be having the same problems we are. They aren’t. Why not?
What Ken said about Telstra an infrastructure provider. It’s a situation roughly anologous to the road network. Imagine more and more main arteries not just privatised but refusing to let your truck through ‘cos it’s allied with a competing consortium.
Not true because no one has said you can’t use the roads. It’s abad example.
Sorry one last thing
It is sheer nonsense to believe that comptetition could only work if the government owned the network. This is just shoddy second rate thinking.
The US FCA does a great job of policing not just one telco by all the Babay Bells to see that they behave. That’s what other countries ahve done as well. Even Germany, where Deuthsche Telecom is private.
In point of fact it would be far better that the wires are privately owned under close supervsions. That way at least shareholders would go some way to make sure the unions don’t go a thieving rampage when the think they can.
It works elsewhere, so you need to prove it is not working to convince a lot of people. Otherwise I just take it that the debate is really about getting the stinking unions back onto a no lose win win game again.
The only thing that should be regulated in media is the access to spectrum on which it is broadcast, as that is a public good. Apart from that it shouldn’t be regulated except for defamation laws and content ratings.
JC, checked the rate of unionisation in the communications sector lately? It’s one of the lowest. Don’t worry too much if that’s your concern - Telstra has already reduced union power.
I think the onus is on you to demonstrate how we have a competitive telecommunications market at the moment, since the level of ACCC intervention tends to suggest we don’t.
And what would happen if the wires were renationalized. You would expect me to believe that union representation for the wires would remain the same?
Yea, right!
“I think the onus is on you to demonstrate how we have a competitive telecommunications market at the moment, since the level of ACCC intervention tends to suggest we don’t.”
No it doesn’t. It means the regulator is ever vigilent in an area that needs close polic e work. That’s all. In other words, where Telstra is a monoply the regulator needs to wastch very closely that it isn’t up to any tricks.
This is what happens in the US as well.
It’s not up to me to demonstrate anything. It is up to those who favour renationalization to prove the wires wouldn’t become a playting for the union movement.
Heck they fucked. Why wouldn’t they fuck the Australian public, again?
sorry
Should read
Heck they screwed GM…..
Two quick points, JC. GM have a lot of other problems.
Secondly, the current federal government actively discourage unionisation among public employees.
Anyway, I have to leave this discussion now in order to respond to market signals by finishing an article for which I am being paid by the deadline in the contract
Mark,
When you have time make friends with Azureus. Drop me a line if you need a hand with introduction.
Cheers, Shaun.
JC, the analogy with the roads seems OK to me. Imagine if a private company owned all the roads and the same company owned a trucking firm bigger than all the rest put together.
One of the problems is that government policy is in conflict with itself. They want to make Telstra a profitable company for shareholders, but at the same time want more competition and want to take market share away from it. Sounds like a recipe for a bugger’s muddle to me.
Also instead of being paranoic about the unions you should focus more on the quality of the company leadership, which, IMHO has been third rate under Siggy.
I’m not at all confident of Sol either. Recently in one of the Fairfax publications they had a good look at him and decided he was really outstanding at two things. One was in looking after himself. The other was in his timing of when to leave. As far as I can make out he is particularly bad at personnel leadership as far as the mass of workers are concerned. Like you he seems to see them as the enemy.
But enough of that. I really only came onto this thread to tell people about an article Dial-a-deal by Alan Jury in the mag FINANCIAL REVIEW smartinvestor (which is partly on the net, but not this article.) He says that:
Jury continues:
As things stand there does not seem to be any risk of ‘capital capture’. OTOH there is considerable risk of management incompetence. But there is also a considerable sovereign risk because the govt and the regulators may not allow him to generate the cash to rebuild the network. They may also not allow him to advance the services available to most of us too far ahead of our bush brethren.
Brian hi
This half pregnant situation is exactly the worst possible position for telstra to be in.
The government is trying to off load all it’s bush committments onto Telstra, which means the shareholders. Think what would happen if they rebought the wires again! They can’t be trusted when the have other shareholders. What would they be doing if they owned the wires 100%. And that’s a Liberal government.
The regulatory apparatus covers more than simple ownership, though personally I think the prospect of massified media companies spreading their ideological umbrellas across the whole community pretty chilling.
It also refers to content regulations, from C classifications to the requirements to broadcast Australian drama on prime time.
Without them, we would not have significant higher budget Australian programs on commercial television. Except for the Olympics and the Commonwealth Games.
BTW - do you realise that SBS has just snaffled the next two soccer world cups? According to them “Federation Internationale de Football Association (FIFA), the governing body of international football, has announced that it had awarded SBS the exclusive free-to-air & pay television and broadband internet rights for both the 2010 & 2014 FIFA World Cups in Australia.
The partnership will also mean SBS will manage the rights in the majority of Oceania, including New Zealand, in co-operation with FIFA.”
There’s an interesting bet on the future.
I’m old enough to remember the break-up of the PMG (Postmaster General’s Department) into Telecom (now Telstra) and Australia Post (a.k.a. SnailMail). PMG did indeed need a shake-up, especially of those in upper echelons displaying florid senile dementia, but as for breaking up PMG right at the time that new technology was hitting the streets everywhere; well, as they say so often in Australia “But it did seem like a good idea at the time …..” Now we are all paying through the nose for that particular folly and getting Third World levels of service for our money.
Nothing substantial to contribute, just thought I’d clear up a few technology facts…
Broadband: Roughly, a network connection with a data throughput rate of at least 1 Megabit per second. That means that if you purchased a 512/128Mbps ADSL “Broadband” package you didn’t actually get broadband, you got fast narrowband.
Narrowband: slower than 1Mbps.
Bits vs Bytes: 8 bits = 1 byte, 1024 bits = 1 kilobit or kb, 1024kb = 1 megabit. Same goes for bytes - 1024 bytes = 1 kilobyte etc. Confusion reigns when marketing people get their hands on it and for some reason totally ignore or fail to understand how the binary nuymber system works and claim that 1000 bits/bytes = 1 kilobit/byte. Drives Data Comms people up the wall.
MODEM: Actually an acronym - MOdulator/DEModulator - converts an analogue signal to a digital signal and vice versa.
ADSL Modem - marketing term describing an ADSL Router, meant to avoid “confusion in the marketplace”… go figure. ADSL is already a digital signal, so no MODEM is required.
ADSL Router: Just like a normal router, but with 2 of its internal connections swapped over, and limited Network Adress Table configuration. If you’re any good with a soldering iron you can easily convert your ADSL router into a fully fledged router pretty easily.
ADSL Port: a multiplexor installed at the exchange to add the ADSL functionality. They cost a lot, and Telstra never asks you to cover the cost of it. From memory, the 1st batch of them Telsra purchased for the ADSL trials cost approx $10,000 per DSLAM multiplexor installed.
“This half pregnant situation is exactly the worst possible position for telstra to be in.” - JC
Which is exactly John Quiggin’s point - you are in violent agreement with him. The only difference is that he judges we can’t get to full pregnancy from here, and so it’s better to abort. Abortion would mean going to the economics textbook model of nationalising the natural monopoly elements and fully privatising the rest.
This has the advantage of testing whether the natural monopoly position still holds - if not, Telstra’s copper wires will simply be bypassed by new technology. If so, we’ve made the best of a naturally bad position.
Now that I’ve bored you with the above, let’s talk about the cost of broadband here in Australia.
It’s a common bitch that it costs too much, often with the rider “compared to other western/industrialised nations”.
Guess what? You’re right! But there are reasons for it. The main reason is… (drum roll)… Australia is a bloody huge geographic area with a comparitivly tiny population density. Hence the cost of infrastructure per head of population is increased. Deal with it. Or increase the birthrate and/or immigration.
As for the “It’s slower too!” bitch - correct again… when it comes to DSL anyway. Without going into it too much it is basically due to the voltage that the Oz telephone network operates at. If we increase the voltage of the phone network we can vastly improve the datarate possible for DSL networks in Oz. And even then there would be other factors such as the capacity of our single(!) physical cable connection to the rest of the world (others are being built soon-ish).
I forgot my favouite snark about Ozzy ADSL!
Static vs Dynamic IP Addresses. If you have a dynamic address, whenever you power off your ADSL router it looses it’s IP addr and will request a new one when you turn it back on. If you have static the IP addr never changes.
Anyone purchase a “static” IP address with their ADSL plan?
If you did consider this: ADSL is natively a static IP Addr technology. When Telstra first started selling it they were adding an extra bit of hardware that forced the IP Addr to change every so often… so they could sell you the “upgraded” static package. Other reasons for it of course, the main one being that if you have a static IP addr it’s hard for them to sell you webhosting services as well.
Tony D:
Thanks for info. Disagree about geography though - for example: Finland, Sweden, China (well, part of it anyway, the inland and western provinces ), all have to deal with huge distances.
fellow contributers:
My point was that the old integrated PMG, IF allowed to modernize, would have have been very well placed indeed to knock over all those problems without too many dramas and then deliver the world’s best service at a bargain price.
Coming back to this late..
Graham’s point is very interesting. There is wholesale wailing going on because Lucent, a French company, is buying the battered remains of Ma Bell’s old laboratory, and people are repeating the amazing list of its achievements. It was, of course, a private enterprise monopoly smashed up by the devotees of competition. I presume everyone did get cheaper telephony, but the scale of research depended on a huge organisation not hammered by cost pressures.
For a long time - a century really - Australia was a world leader in communications technology, precisely because of our distance problem. Our labs were among the best as well. Then of course we broke up the PMG.
I can’t debate whether that was the best thing to do, but it is wise to record the damage along with any improvements.
David, I was thinking similar thoughts in relation to Telstra. Scale is one issue. Privatisation and the introduction of competition has also led to short-termism and a focus on shareholder value rather than the optimum communications system for the country.