Major Government Reforms And Challenges In Australia's Broadband Network Industry

National Broadband Network (NBN)

Question:

Choose any one industry and discuss reforms in that industry in Australia which include government competition policy, labour reforms and labour laws, minimum wages, productivity and training and technology (broad band).

Government reforms relating to broadband network in Australia has been a remarkable reform in the industry. Australian Government has invested a huge sum for implementing the ultra fast fibre-to –the-home (FTTH) network relating to broadband to give away a speedy network connection amongst the household as well as commercial purposes. National Broadband Network (NBN) is a project in Australian market to update the network and improve, upgrade the infrastructure for a dynamically enhanced digital system. A better quality connection with the implementation of different technologies is essential for education system, better lifestyle, entertainment, bettered workplace and industries. One of the advantages of NBN over the years has been its high speed.

A network development in Australia was under the political and social influence for a number of years.  The things did not go as it was actually framed. Unplanned beginning, wrong procedures, social and political influence, unwanted delays all were responsible for a rough start. Reports have also evaluated that when NBN expended a $7.3 billion it only could deliver its network resources to 3, 50,000 buildings or premises, but introduction of fibre to the node (FTTN), fibre to the building (FTTB), long term evolution (LTE), fixed wireless, these architectural designs have made its significance relevant in the eyes of the people by imparting the systems among a good number of premises year after year.

The Telecommunication and Regulatory reform in Australia brings out a system through which the market shall be neutral competitively and flexible relating to price. The reform shall encourage the developers in the market to provide different upgraded services and also safeguarding of the customers. Both the wireless and satellite services could go hand in hand in the market as and when they are required, they are used accordingly. The government made a total fifty three suggestions or recommendations for calibrating changes in the telecommunication markets. The competition regulation was governed by the Competition and Consumer Act 2010 (CCA). The structural issues relating to regulations, overall monitoring of prices, and encouraging new development strategies were some of the key issues of the reform. With response to the suggestions made in relation to the reform the government agreed to make changes in the infrastructural pattern in competitions. New legislations were to be introduced in Part 7 of the Telecommunications Act 1997 which shall take effect from 1^st January, 2017. The act shall also be amended in certain places, in Part 8 specifically. For development or innovation of new products ACCC shall provide with certain instructions. An issue relating to privatization of National Broadband Network was also a key point. (Government, 2014).

National Competition Policy was introduced in Australia, in the year 1995. Gradually, reform in the broadband sector took place. But, telecommunication services started liberalizing in the year 1990s only and became popular in the year 1997 as Australian government started selling the telecommunication providers owned by the government itself. The ADSL enabled telephone services are capable of delivering broadband services, in mostly nonmetropolitan areas.

Telecommunication and Regulatory Reform

With the gradual decrease in cost, the service providers got appropriate controls over the network excepting the copper pair line. In the year 2003, in South Australia (Meningie), an internet service providers’ inter-node was installed, with this the competition in non commercial infrastructure market took place. The first notable name for competition in the market is Optus (XYZed) for introducing xDSL services and it gave competition to Telstra’s DSLAMs, and it was in the year 2000. The copper upgrade proposal of Telstra in 2005 and up gradation of the fibre to the node network as well was put on hold; later on an agreement was signed with the company and Optus in 2011 to remedy the same.  In later years, Telstra was seen to upgrade their systems and engineering in providing the customers with better experience while surfing net, with a speed up to 8 Mbit/s. Telstra is said to provide almost 3 million retail fixed broadband services. There were companies like Microsoft, Google which showed encouragement towards National Broadband Network, Australia and also there were a lot of criticisms and social as well as political pressures for the same.

On the other hand, Agile Communication has been significant in providing network connections in rural and regional areas as compared to Telstar. Fixed line broadband and wireless connection, both were acknowledged in this case. The company invested in giving out connections to backward areas with their own microwave network. Later on Government invested a large amount in meeting the network needs in rural and regional areas as well in September, 2006. iiNet brought in the year 2007, the first naked DSL system.  With the introduction of this thing, the network connections without telephonic network could be made possible. With the growing development in the broadband industry, the number of people using internet also increased. (Cameron, 2005).

During the years 2009-2013 National Broadband Network faced a rollout. For poor decision making, taking short cuts, it faced continuous diminution in its management process. The election pressure also led them to be so. The Coalition and ALP agreed with the government regarding reform thinking that it would provide high speed internet to the regions of Australia. The introduction of fibre optical cable to almost all the buildings in the country and fibre to neighborhood cabinets took almost a decade to reverse the system from copper cables. The ALP completion period is on 2021 and introduction of satellite and fixed wireless customers, creating monopoly power are its motto. The Coalition completion time is on 2019 and its major objective is to allow Telstra and Optus to have a competitive environment using the prevailing network system which was outlined for Pay-tv. The pricing would be kept wholesale. These notable parties would provide a better experience with the networking system in different parts of the country. (Jennett, 2013).

The owners of buildings and apartments have to choose between installations of telecommunication equipment into their building for providing services or it would depend upon a network service provided by an autonomous network service provider. If they want to install the device on their own then it shall be checked if the building occupants have any personal choice of opting for a service provider or competition in the future. The regulations imposed by the government are to be properly checked in this regard.

Development of the Broadband Network in Australia

The question of end user’s privacy and net neutrality has seemed to remain a debacle in the Australian network. But, with the integrated companies like Telstra, those problems could be addressed with the better trafficking and improved user experiences.

In the beginning there was the Conciliation and Arbitration Act, 1904 which involved settlement of arguments and misunderstanding in the industries. Later on due to inconsistencies observed, different regulations were introduced.  The Workplace Relations Act, 1996, The Work Choices Act, 2005 was enforced thereafter. In the 46^th National Conference in December 2011, a new National Platform was given for the labor market. The government indulged in helping and supporting the working families and their children, creation of employment opportunities in changing economy, and investing in infrastructures to welcome better resource facilities.

Australian Labor Party won the election held in November, 2007, and particular schemes of improvements were promised by the party for the coming years, but they suffered from real disasters.

Labor is dedicated to create a feasible framework for regional network development and it would ensure each and every regions. When both Coalition and Labor wanted to change the prevailing perspective of Australian broadband, labor was observed to be incompetent to meet the objectives within the stipulated time period as promised by the authority before. In the 2007 election, it was promised by Kevin Rudd that an NBN will be completed within the year 2013 which involved almost $ 4.7 billion public funding. But coping up with the continuous disasters and problems, it is heading to meet the objective so slow that it is at gamble if it could be completed within the year 2021. The promised network was present in around 72,600 buildings and this could properly be utilized in only 10, 400 buildings from those 72,400. Different pricing policies, varied download speed, network errors, wrong decision making and poor management system has been the real drawback in the situation. It is unknown whether the stakeholders would be able to earn a promised 7 % return on investment from this National broadband network policies and reforms, as that is also unforeseeable. In the year 2009, it was chosen to be most costly than any other broadband plans in the whole world, where as practically a broadband plan should be such that would meet the optimum efficiency and customers need in a cost effective way. In this way to mitigate the labor’s problem relating to cost, the fibre were extended to cabinets in basements of premises or within few hundred metres of buildings. With the use of existing copper cables, the expenses could be managed. Coalition was probable of giving more advantage to the customers in comparison than labor. The government though tried hard to neutralizing the competition among the companies, but they remain somewhat the same, the regulations were made to reduce the cost and variety in broadband plans. 

The regulation naming “WorkChoice” came into force which suffered from the following attributes:

1. The convention gives out the workers with a choice to do the job or choice of job.

Competition in the Broadband Market

2. The workers when have poor bargaining power only could attract an individual job, and such individual job contract may involve poor and stringent norms.

3. There were only the liberal party and large business industries which were satisfied with the WorkChoice legislation, neither Australian Labor Party nor the Australian Council of Trade Unions were antagonistic to the proposal or legislation for its harshness.

4. The agreement wanted to weaken the collective bargaining power of trade union.

The Australian WorkChoice Agreement also suffered when in the year 2007 a lot of workers were suffering from unemployment which covered almost 10.6% in Queensland, 7.7% in Outer Western Melbourne, 9.4% in Tasmania, 7.8% in Northern Adelaide. The unemployment was because the WorkChoice Agreement failed to address its positive impacts in those regions. As the labor’s broadband of rolling out the fibre to the node network would take place, it would cover almost 98% of the Australian to a high speed network connection and it was hoped to create new job opportunities as it would address the issues relating to government’s failure to deliver the fibre to the node infrastructure.

There has been an increase in the minimum wages when the West Australian Industrial Relations Commission decided to increase the same by $20 per week. This shall be applicable to all states. The Australian labor party believes in the amount of wage would be provided along with remuneration which will be in a just and equitable manner and should not result in inflated amount of wage or a very low amount of wage as well. The trade agreement shall be such that the minimum wages and remuneration as the case may be, is protected keeping in view the labors skill and competence.

1. The fixed line network system involves some fibre optic cable which helps to transmit the data unlike the traditional copper cable system. In copper cable system the probability of loss of data was found to prevail in the system, which could be made good with the introduction of fixed line networks. The fibre optic cable goes from a building to a street and is fixed at the top of a power pole, and that is kept under ground. The service point covers almost sixteen fibre distribution areas and that is capable of providing services to almost a 3200 premises.

2. The fixed line broadband ADSL +2 have been a phenomenal network system, most widely used and very much cost effective. The cost effectiveness is really an important issue when network service is of crucial importance in a business or in day to day activities involving huge data, the cheaper the broadband plan, the better it is. There are good combo offers available in the market, which includes calling rates plans for national as well as international calls along with particular data for online surfing. The disadvantage associated with this technology is a phone line is required to be taken; a modem has to be fit. The connection may be slower than the wireless fidelity network connections. There might be hidden cost involved along with the installation of the telephone line.

Challenges in the Rollout of National Broadband Network

3. Bright Telecommunication was the first company to introduce the fibre to the home network system in Australia in the year 2001. A broadband speed of 50 mbps can be provided by the broadband companies. The nation was firstly decided to be regulated with this kind of networking system and later the fixed wireless system came into effect. Since, there has been a change of the regulatory authority in the year 2013; the fibre to the premises roll out was seen as a bit skeptic for the national broadband network which will be involved in a mix of multiple technologies. (Taylor, 2014) NBN Co. has a plan of evolving with the wireless network, which will be a 4G connection. But, this will not cover a good percentage of regions of Australia. Spectrums of 2.3 GHz and 3.4 GHz shall be put to use for accomplishing the setting up of the system. More electronic devices like desktop, laptop, computer, mobile phones, and cameras with operating systems could be used with the help of the wireless fidelity network from the signals of a particular router. The wireless connection can be city wide, campus wide (in case of a workplace, educational institutions). The companies like NBN provide with a user guide for the operational purposes.

4. In Satellite broadband connection a satellite internet dish is provided by some companies or they provide a device. The data is transmitted with the help of radio waves, very small aperture terminal and a dish antenna which is to be fitted in the premises of the customer. A star network topology is followed in the process where each and every network communication, data and information is transmitted through the main processor. The NBN Co. wants to initiate two Ka band satellites.

There have been a number of studies which show that the reforms and changes in the telecommunication and broadband networks in Australia have showed positive impact in its economy since the year 1990s. A multifactor productivity growth of 65 to 85 % between the years 1985 to 2002 was observed to have taken placed due to Information and Communication Technology products and mediums.  In the year 2001-02 around 2, 89,000 people got job for the introduction of broadband. The e-commerce activity also improved and was made comparatively simple. In later years, mobile broadband and internet also proved to be a boon to the Australian economy as productivity in mobile sector increased by 11.3 % in the year 2013 from the year 2006. Business operation cost also decreased and the overall economic activity of Australia increased in the year 2013 by $33.8 billion (Data taken from (acma, 2014) ). There are about 6 % premises which are not able to get a fixed internet broadband service.  About 28 % premises have a admittance to peak download speed which is between 25 to 110 Mbps. Coaxial cable network, fibre to the node framework and fixed wireless network is also available to almost a 28 % premises (high speed internet). The areas where broadband connections are not properly served are pointed out and NBN would address those regions in the future with better technology.

Future of Broadband Network in Australia

There are short term trainings or course for the broadband programs which is approved by the NBN Co. Australian government has also conducted online lessons regarding computer and internet. Due to the changing computer and internet activity in the industry, people need to stay updated with the environment. A proper knowledge is provided in such training programs. The workers who are involved in specific industries and activities are provided training relating to their field of activity, there are courses which have to be pursued by the workers mandatorily and there are courses which are recommendatory. Courses involve the regulations and rules, the awareness and safety, power awareness, aerial construction, installation of hardware, fibre optical cable etc. The Australian Seniors Computer Clubs Association has also come up a number of training programs, consists of the elementary as well as the specialized programs regarding computers and networks for the seniors.

Conclusion

The Australian broadband has improved over the years but there are many developed nations, with which Australia lags in competition. When it was said by the honorable Communications Minister Malcolm Turnbull in the year 2013 that the Coalition’s fibre to the node national broadband network will be able to transmit a maximum of 25 Mbps speed, the same could not be met. But, Australia has been remarkable in utilizing the mobile broadband technology amongst the major OECDs. A huge number of mobile broadband customers with a rate of penetration of 114% were observed during the year 2013. Some of the broadband service providers in Australia are BigPond broadband, Optus Broadband, iiNet Broadband, Telstra business broadband, Internodes Broadband etc. Competitions relating to costs, data packages, speed revolves around these companies which the government has tried to neutralize over the years by implementing certain regulations. There have been major ups and downs in the network systems which were further corrected with the introduction of developed network infrastructure. Although, the broadband technology is not as developed in Australia as many other countries across the globe, but the system has grown over the years keeping in view the underserved regions, and introducing better technologies. Weekly reports are exhibited which points out the overall progress achieved with the NBN projects, the number of regions additionally covered in the week, and with what network technologies with statistics. A corporate plan involving three years is chalked out and uncertainties of any kind are to be considered to resume the program as it is even in the time of contingencies. Such corporate plan was firstly formed with a long term business perspective for the period June 2011 to June 2013.

acma. (2014, April 4). Mobile broadband boosts the economy. 

Cameron, A. L. (2005). National Competition Policy and Broadband provisions in Australia. In W. T. Stewart Marshall, Encyclopedia of Developing Regional Communities with Information and Communication Technology (pp. 506-508). Australia: Idea Group Reference.

Eisenach, J. (2014). Australia’s failed experiment in government-owned broadband. TechPolicyDaily , 1.

Government, A. (2014). Telecommunications Regulatory and Structural Reform. Commonwealth of Australia.

Harkness, P. (2008). Labor Market ‘Reform’ in Australia: The New Industrial Relations Law and the Elections. Monthly Reveiw , 4-6.

Jennett, G. (2013). Broadband policy: where the parties stand. ABC News , 1-3.

Taylor, J. (2014). Fibre to the node becomes default NBN deployment. ZDNet , 1.

Taylor, J. (2014). NewSat offers to buy NBN Co satellites. ZDNet , 1-2.