A friend of mine emailed me this today:
“If all of the tenderers (who are in the telecommunications business) were too expensive, what makes the government think that it can do it for any cheaper.”
This was my reply:
Don’t get me started on broadband.
The main reasons I don’t have broadband at my house is regulation of telecommunications industry, insufficient property rights protections and housing/building regulations.
Secondly, they are subjected to onerous council approval.
Also, in recent years the ACCC has blocked Telstra’s infrastructure proposals. Not to mention the fact that Australia’s poor infrastructure is a relic of government monopolization. (ie: Telecom).
The land zoning offices first introduced in Sth Australia in the late 70s have caused land prices to sky rocket in Australia (as is well documented) compared to building costs. But part of these regulations mean that home building companies have to guarantee electricity, plumbing type infrastructure when building. That’s why it is illegal to build in much of the outer suburbs and why when some land is freed up by the zoning deparments, it’s only big corporate builders that have the means to build the housing estates, small builders can’t compete anymore. The existence of the modern housing estate is evidence of this. For more info see http://www.economic-justice.org/tyranny_of_planning.pdf
I’m betting these infrastructure requirements for new housing areas have contributed to the poor quality of the infrastructure itself in my area – because of the inflexibility and the costliness of the government demands. For example in my area, all the electricity and phone lines were compulsorily placed under the ground. Now it is very costly to upgrade and the regulations surrounding this type of thing are most definitely stifling creative solutions to this (after creating the problem to begin with).
We’ve had problems with power blackouts, poor phone line performance and of course we still can’t get broadband.
Optus probably would have laid cable in the mid 90s if they weren’t blocked by the councils. They were able to lay cable in some of Melbourne’s suburbs, but not in all councils. In Adelaide (a much smaller population), they didn’t even bother but I bet it could have been economically viable without regulatory interference and the violation of property rights by councils. I didn’t live in Adelaide in the mid 90s but speaking to some of my friends that did, they remember that Optus did attempt to lay fibre optic back then.
So the government stuffs it up for me, then pretends to come to my “rescue” by unnecessarily and forcefully using my own tax paid money in their new infrastructure proposal. Not how the government is boasting about the huge expense of this proposal while having the gall to pretend they are helping me out, over 10 years later than Optus could have (for free).
At least a common thief doesn’t expect thanks after he screws you over!
The only people that really benefit are the bloody politicians.
The government is effectively hurting average Australians who are trying to run their own businesses and live happy and healthy lives. Ultimately the government is decreasing the quality of life of Australian people. By increasing costs (in the case of land zoning, land prices have risen 10X compared to building costs) you are ultimately killing people earlier. The money unnecessarily taken could have been used productively, but not anymore.
Plus I’m almost certain that after kruddy Rudd’s telecommunications spending, my suburb still won’t have broadband anyway.
What will happen is that 1 or 2 bloody farmers in whoop whoop will be getting super speedy internet subsidized by the average tax payer and ISP customer while hundreds of us in Athelstone only 15 min from the city won’t get shit. The government will pretend they are helping out the “Ausie battlers”. But in reality, they are forcefully screwing over a large number of people to help a small number. This is wrong no matter how you look at it.
So after all that, I also agree with you that much of it will not be economically viable under the current regulatory schemes and ACCC.
And then there’s the internet censorship…….
Justice is clearly not being served and it is maddening.