Akamai State of the Internet: Canada still leads Australia (and here's why)...

The recently released Akamai State of the Internet Report shows that Canada is still leading Australia in all measures except the number of subscribers to connections of less than 256mbps. Here is a break down of the comparison from the Q2, 2011 report:

Despite the roll-out of the NBN and a policy focus on broadband, Australia still lags behind Canada. Will the NBN help Australia to "catch-up", or does there need to be a fundamental move away from the single national solution?

It is popular to believe that Australia has always been a "world-leader" in telecommunications outcomes. But not long after federation, things weren't looking too good. Here is a little snippet from Hansard in 1909. The "single national solution" wasn't working even back then:

With reference to your recent verbal inquiry as to how many new telegraph line extensions, apart from those along railways, have been provided in Queensland since the transfer of this Department to the Commonwealth... As every one is aware, Queensland has developed enormously during the past ten years... Yet every day I receive complaints of the telegraph system, and requests to try to get something done to improve the communication with Brisbane... Yet nothing has been done to cope with the increase of business, though all that would be necessary in cases like those, the poles being already in position, would be to fix more insulators, and put up new wires. Notwithstanding the public complaints, and my efforts, I cannot get the Department to move, and so desperate are my constituents becoming that some of them talk of voting against me because nothing is done for them. I ask the Postmaster-General to give us fair treatment.

Telecommunications remains a great "policy lever" for Australian governments, to be pulled in case of political emergency. Or not.

For example, the Royal Commission into Postal, Telegraph and Telephone Services (1910) found that sufficient funds to maintain the telecommunications network were withheld by the Treasurer to achieve other political aims in federal-state relations:

[T]he system of management is faulty, in that it permitted the Treasurer to assume financial control of services for whose efficiency he was not responsible.

This is more than just one historical flash-back where politics got in the way of the adoption of new technologies. And it wasn't necessarily the fault of Telecom Australia (back in 1982):

The present Government has rejected several of Telecom Australia’s attempts to enter new growth areas. These initiatives have included approaches for Telecom to be permitted to supply services such as facsimile machines, telephone answering machines, and videotex services. Telecom has also tried to obtain permission to market and supply under 50 line private automatic branch exchanges. Each of these initiatives has either been rejected by Government or not responded to...

The reasons why Telecom Australia was refused entry to the markets listed above appear to be political and ideological rather than a rational assessment of what the future requires for a viable and dynamic Australian communications enterprise.

Moreover, Single solutions take too long:

In 1998, the external territories and many remote communities on the mainland are still awaiting the delivery by satellite technology of many of the expectations of 1977 for instructional TV, telemedicine and digital data transmission.

Australians have always paid too much for these inferior services, too. And it isn't because of factors peculiar to Australia. According to the Productivity Commission (1999: xxiii):

• Australia’s residential and business telecommunications prices rank about average among the countries benchmarked.

• However, prices in the best performing countries are 20 to 40 per cent below Australian prices on a purchasing power parity basis in most major market segments.

• The results are not sensitive to changes in assumptions about usage.

• Further, the price performance gap is too great to be explained by factors outside the control of industry participants, such as technological change, input prices, taxes and geography.

• An overall assessment of the evidence points to government involvement and intervention having a major influence on prices across the countries benchmarked.

My argument is not against government ownership per se, but against monolithic control by one particular government. So long as the provision of communications services remains purely a political (rather than a commercial) issue, Australia will always be behind other developed nations. And what's more, we'll continue to pay too much.

Steve Jobs R.I.P.

Today I took delivery of an iPad 2 wifi, courtesy of the AFR Smart Investor SMILES survey. Today also happened to be the last day the founder of Apple Inc was of this earth.

Typically, using Apple devices gives me a little taste of what it's like for my parents when they use Facebook, but the iPad is proving to be very intuitive.

I've been a big fan of desktops but the iPad is definitely changing the way we connect on the go. It's little wonder that now more Australians use mobile connections than DSL with such lightweight devices.

The popularity of iPads and iPhones is such that the next iteration of my e-textbook will be in VitalSource as the company's iApp is proving very popular with my students. So popular, in fact, that the success of the earlier version was limited by its accessibility via an iApp.

Jobs' enthusiasm for an interconnected world will be sorely missed, as will his presence in an industry that has been dominated by only two uber-geeks for most of my lifetime. But as Henry Ford was the mass producer who set the tone of the 20th century, Jobs and Gates have certainly set the scene for the information revolution that still, after all these years, seems just that little bit around the corner.

For Jobs, not being here to witness the fruits of his foresight in its full glory is one of the all-too-common tragic consequences for many of history's great visionaries.

Government tries to solve NBN puzzle with more government

Who knew back in 1901 that by giving the Commonwealth the power to deal with “Postal, telegraphic, telephonic, and other like services”, we’d be in this mess 110 years later?

In October last year, NBN Co and government officials briefed Gungahlin residents on the local NBN rollout, but they had very little to say. Most people wanted to know the big things: Who will get access to it? Where will it be deployed? When will this happen? How much will it cost? Instead, NBN Co rattled on about sharing the future via the NBN, to think of the possibilities, and not dwell on the facts.

Approaching a year later, and with NBN’s Gungahlin rollout imminent, the big questions still haven’t been answered by NBN Co or the federal government. The release of the House of Representatives standing committee on infrastructure and communications report yesterday had this to say about the communications problem:

To date, much of Australia’s public debate around the NBN has focussed on relatively narrow issues such as pricing structures, technology options and governance issues. During the inquiry, the Committee perceived a growing appetite for a broader public discourse around what benefits the NBN could enable across Australia’s economy and society (Chapter 10, p, 245).

Rather than fix the problem, the “Labor-dominated” committee has found, after fluffing off any arguments which challenge the very design of the NBN governance model, that the solution is to talk more about the benefits of the NBN.

Citizens still want to know the big questions about NBN: Who will get access to it? Where will it be deployed? When will this happen? How much will it cost? None of these questions have been answered. Citizens are still treated with contempt and asked to “imagine the possibilities”.

Australia’s communications industries have always suffered from politics. Since the early days, we’ve been told how fabulous our communications infrastructure is when clearly we haven’t stacked up well against other advanced economies.

The only way to fix the NBN’s woes is to get the industry out of the hands of politicians and let it deal with market demand – it really is that easy.

The litmus test to check when the politicians are further enough away from the industry is just as easy: when a telecoms company CFO resigns, the event won’t even raise Malcolm Turnbull's eyebrow. In the meantime, government is the problem, not the solution.


Photograph: Copyright © 2007 Michael de Percy, taken in Canberra, 16 April 2007
_____________________________________________________________