ELECTION 2010: Coalition unveils broadband policy, sets aside $6.3 billion for network construction and existing network upgrades

The Coalition has promised to spend over $6 billion to build an open-access broadband network, upgrade current infrastructure and create wireless networks in a plan it says will deliver high speeds to 97% of households at a fraction of the cost of the Government’s National Broadband Network.

Communications spokesman Tony Smith says the Coalition’s plan would build on existing private sector networks to deliver 100Mpbs to the vast majority of households, and wireless services will mean most Australians will have access to a minimum speed of 12Mpbs.

However, unlike the Government’s NBN, the Coalition will leave private sector networks alone and only extend those networks to improve access for users in hard-to-reach and rural areas.

The policy announcement comes as the information technology and small business industries have attacked Coalition leader Tony Abbott and communications spokesman Tony Smith for their plan to drop the NBN.

The Coalition says its plan will mean 97% of households will have access to speeds of up to 100Mpbs, and a minimum of 12Mbps, by 2016. The remaining 3% will be connected through satellite services.

“The Coalition’s policy spends sensibly and responsibly. Labor’s plan is to recreate a Government monopoly,” Smith said this morning. He and communications minister Stephen Conroy are set to debate their respective communications policies this afternoon at the National Press Club.

The Coalition’s plan will be rolled out in three separate projects. The first will see the building of an open access network, at a base cost of $2.75 billion, with the expectation of gaining another $750 million from the private sector.

“This open access optic-fibre backhaul network can be accessed by telecommunications companies. This will break the competition problem; this will break the bottleneck that has held back competition and investment in rural areas,” Smith says.

“This, together with associated regulatory reform will remove the roadblocks and drive a cycle of future improvements and higher speeds across a range of technologies.”

The second plan is a $750 million commitment for “fixed broadband optimisation”. This means existing networks will be extended to those who can’t currently access them, such as those homes in areas where an exchange might just be out of reach.

“We are committing funds to try and provide a great many number of those people with fast broadband. If you live near an exchange, you get a decent broadband speed. There are other premises where that is not possible because of network design, and we are going to rectify that.”

The third pillar of the Coalition’s plan is $1 billion in grants for rural regional wireless networks, to be constructed alongside the private sector. Another $1 billion will set aside for the construction of networks in metropolitan areas.

“Simultaneously, we will be investing in a wireless network which will principally deal with other problems in outer-metropolitan Australia. Together, those components will ensure 97% of the population has a baseline minimum service of 12Mbps.”

The remaining 3% will be covered by satellite services. Smith also says many others will receive higher speeds than the baseline amount due to private companies upgrading their own networks, pointing to Optus’ recent upgrade of its east coast network. The remaining funds in the plan will be put aside for extra investment as it is needed.

The emphasis here is on private sector development. Smith and Robb say the private telco industry will provide better services than the Government ever could, and promises its programs to be rolled out by 2016.

“Our program is an open access program that will ensure there is competition every step of the way,” Smith says.

Finance spokesman Andrew Robb also took the stage, saying the Coalition’s plan delivers better value for money and will not be as expensive or time consuming as the Government’s NBN plan.

“We will not be opening a massive Government monopoly. We are not going to wait another eight years to give rural Australians the service leverage and speeds they deserve.”

Smith says the Government is spreading a myth that Australians want to pay for 100Mbps services, and realistically, the demand just isn’t there.

“People aren’t prepared to pay for that, that’s the evidence around the world. This is the myth the Government likes to perpetrate,” Smith says, adding there hasn’t been a large take-up of high speeds in Australia where those services are available.

The commitment comes as the Australian Information Industry Association took out an open advertisement in major publications this morning, repeating its key theme of the campaign – information technology isn’t being taken seriously.

Citing figures suggesting the OECD ranks Australia low for multi-factor productivity, investment in ICT declined by 50% from 2000-2007 and the World Bank believes broadband penetration adds 1.2% to annual GDP.

“The AIIA calls on the current government to elevate debate on Australia’s place in the future digital economy in the final stage of the campaign and for all parties, including the Opposition, to clarify their positions on ubiquitous high speed digital infrastructure for all Australians and how they intend to maximise Australia’s place in the future global digital economy.”

Peter Strong, chief executive of the Council of Small Business of Australia, says the National Broadband Network is necessary.

“This is necessary for small businesses to stay connected. It can’t just be about speed, it has to be about confidence of the connection, especially using services like Skype and so on. People want ease of access, and it increases confidence in business.”