Tuesday, 9 August 2011

Australia still lags Canada: State of the Internet

Despite intense political interest in the state of Australia's broadband infrastructure, four years on since the Rudd Government won the 2007 federal election (with broadband featuring heavy in the ALP's policy platform), not much has changed: Canada is still leading Australia in broadband access and speed.

Average Connection Speed
Canada has a decentralised telecommunications market, dominated by regional monopolies. However, there is significant competition between platforms, particularly ADSL (traditional telecommunications carriers) and HFC (cable television providers). A major difference is that the regulatory system enables greater access to  address anti-competitive practices, especially for smaller competitors.

Average Peak Connection Speed
Meanwhile, politicians insist on making imprecise comparisons between Australia and New Zealand, as Malcolm Turnbull did at his recent National Press Club address. The latest Akamai State of the Internet figures demonstrate that  comparing Australia with New Zealand is hardly inspiring:

Broadband speeds in Australia versus New Zealand
As two of the most similar countries in the world, Canada and Australia provide a unique comparative study for political scientists, enabling the adoption of Mill's method of difference to find the underlying cause of different outcomes. A key difference is the extent of decentralisation in Canada's communications industries.

High Speed Broadband Adoption
According to the latest Akamai State of the Internet report, Canada beats Australia on all measures of broadband adoption.

Broadband Adoption >2mbps
To prove the point, the only measure where Australia beats Canada is in the adoption of "Narrowband" - connections with speeds of less than 256kbps - which is hardly an enviable position. Enabling competition by freeing up the market from federal control is the only solution. When the NBN is completed in 2020, this will remain a short-term fix.

Narrowband Adoption
Mark my words: the underlying problem of political control of Australia's communications infrastructure will be back to haunt us at the next evolution. Indeed, it has happened repeatedly throughout the history of Australian telecommunications policy. The following is from the report of the Royal Commission into Postal, Telegraph and Telephone services of 1910:
The result of unduly curtailing expenditure was pointed out repeatedly by the Department, and the required provision was made on the Estimates, but was reduced by the Treasurer. The longer the reconstruction is deferred and the longer installation of a new system is postponed the more expensive the work becomes, on account of extensions made to the old system. Construction methods were found to be practically the same as in 1901, as the Department claimed it had been impossible to improve these methods since that date, although the adoption of improved methods would obviously have tended towards economy.
100 years on and communications infrastructure is still used as a "policy lever" to be pulled every time politicians need a boost in the polls. The trouble with the NBN, despite the obvious advantages in the mid-term, is that the new and improved policy lever is an investment of such staggering proportions that it will be difficult to pry it from the hands of those who wish to continue to play politics with this important infrastructure.
                                                                                                                       

Creative Commons License Except where indicated otherwise, Le Flâneur Politique by Michael de Percy is licensed under a Creative Commons Attribution-Noncommercial-Share Alike 2.5 Australia License. Based on a work at politicalscience.com.au. Background image ©Depositphotos.com/ @redshinestudio