The agreement announced between Telstra and the Federal Government regarding the National Broadband Network have bought this infrastructure project back into the headlines. While the agreement is non-binding, and there are other hurdles like shareholders and the ACCC to deal with, it seems to strike a good balance for both parties, so you’d think everyone would be happy with it wouldn’t you? Not bloody likely.

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Let’s see what News Limited’s financial guru has to say about the deal.

The net result of yesterday’s deal is that we will go back to a mid-20th century future: a government monopoly of our basic telecommunications.

Which has an element of truth to it, but carefully ignores the fact that the government plans to fully privatise the NBN company. What we will have is a nation-wide fibre optic network that most Australian homes and businesses will have access to via a number of different retail providers. The Keating Government’s failure to separate the wholesale and retail arms of Telstra when it was corporatised in the early 90’s has been at the root of most of the competition problems in the Australian telco sector in the last ten years, the NBN as proposed finally addresses this problem.

McCrann does acknowledge that this agreement is a better outcome than the NBN duplicating Telstra’s existing networks, but you have to question if he really understands the importance of the NBN when he makes ignorant statements like this:

the Government [is] spending up to $40 billion of your money on a fixed broadband network that most people don’t want and which is already being rendered obsolete by wireless broadband.

As I’ve pointed out before contention issues with wireless communications mean that it doesn’t scale well, if you doubt this even for a second have a look at any large office and see how many of the PCs are using a wireless connection at their desks rather than ethernet. Additionally, fibre optics are an amazing transmission technology because of the ability to increase performance as technology improves.

The internet is more than just the web, it is an information utility, and once there is ubiquitous high speed access to every household in Australia it will provide enormous opportunities for businesses and governments to provide services that we can barely imagine at present. McCrann, along with many other critics of the NBN, seems unable to grasp the enormity of the importance of the internet to our commercial and social future much like a pre-verbal caveman could never have understood the worth of the invention of the telephone by Alexander Graham Bell.

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