Rudd government Internet company to be sold by 2022???

Internet company to be sold by 2022 (SMH)

THE Rudd Government will next month try to lock Parliament in to approving the sale of its new broadband company by 2022 in a bid to avoid a repeat of the bitter Senate debates over the privatisation of Telstra.

In an interview with the Herald, the Broadband and Communications Minister, Stephen Conroy, revealed the legislation to set up the company will also prevent the government from keeping it in majority public ownership.

“We’re legislating that sell-down provision. It will be a mandatory requirement to do it,” he said.

But how can the federal government legislate effectively to make it “mandatory”? Can Federal Parliament constitutionally entrench ordinary legislation using “manner and form” requirements? How else could it prevent some future government from taking a different view? Do these sorts of assertions square with responsible government or other norms of liberal democratic constitutionalism, or is just empty political rhetoric?

About Ken Parish

Ken Parish is a legal academic, with research areas in public law (constitutional and administrative law), civil procedure and teaching & learning theory and practice. He has been a legal academic for almost 20 years. Before that he ran a legal practice in Darwin for 15 years and was a Member of the NT Legislative Assembly for almost 4 years in the early 1990s.
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15 years ago

But how can the federal government legislate effectively to make it mandatory? Can Federal Parliament constitutionally entrench ordinary legislation using manner and form requirements? How else could it prevent some future government from taking a different view?

They could find private investors to get involved and then sign a contract that the thing will float to the ASX and be sold off, giving the private investor a chance to make a profit. Come 2012 there will be a contract, and possible legal challenge if the sale does not go through. Mind you, one would HOPE that such a thing would be based on honest and open disclosure of the contract details along with an offer for multiple private parties to get involved. One would EXPECT quite the opposite.

I’m kind of bothered by what makes these guys think they can do a better job for cheaper cost than everyone else in the industry is doing. Reading through Rudd’s speech here:

He is proudly announcing 100Mbps connections over fiber, but is that full duplex, or half duplex, or is it a giant downlink on a tiny uplink? Will there be monthly quotas on that? Will this enable Australians to host Internet services for reasonable prices (i.e. build up an export economy) or will it be basically just a reason to mass-consume movies? Will the 100Mbps be a contended service (i.e. you sometimes get a peak at 100M but on average get much less) ?

If Rudd was willing to aim at something more sensible (I propose 10Mbit full-duplex, non-contended, without monthly quotas, based on the existing 10M ethernet standard) it would still be a really useful system, and plenty fast enough (even for movie watching) and he could use a lot more of the existing copper infrastructure (with suitable agreement from the owners of that infrastructure). We already have RG6 grade coaxial-cable going into a good fraction of houses right now (e.g. Foxtel, Optus cable, etc) which should be able to easily handle 10Mbit full-duplex. Even basic ADSL2 technology is pretty good over a shitty CAT3 twisted pair but the industry is being held back mostly by price and the monthly quotas and that the ISPs are reluctant to support large uplink speeds (making server hosting exceptionally expensive). Fiber to the home won’t fix any of that.

So Rudd and Conroy are determined to deliver brand new infrastructure, leave something behind for people to remember them. Are they going to dig new holes everywhere? Or do they intend to pack all these fibers into existing Telstra pits? Once this new business is sold, what will happen to access rights to Telstra’s pits and pillars? I suspect there are much more immediate worries than how to sell off this beast.

David Coles
15 years ago

Speed – 100Mbps symmetric is shared between 32-128 people is a starting point, the likely technology (passive optical network) will scale to 1GBps (in fact Verizon is deploying 1GBps now) and beyond. The other option is an active optical network which provides 100Mbps full duplex to every subscriber, but is more expensive. These sorts of details haven’t been decided upon yet.

The cable will be hung from existing electricity poles in most cases, no digging required. On the AusNOG list it’s said Verizon finds its optical network cheaper to maintain and more reliable than its copper network. As for the existing copper network, it can be upgraded in the short term, but in 10 years (which is when NBN will be complete) it’ll be time to move to FTTP anyway. The NBN is being done outside in anyway, so ISPs have several years to get the most out of the existing copper before NBN arrives.

Monthly quotas – FTTH won’t fix that true, but the private sector is building new undersea cables so there’s no need for the government to intervene. Uploads – FTTH will fix that, as the problem is ADSL2+ being limited to 1Mbps up, there’s nothing the ISPs can do (except deploy Annex M, which increases the practical limit to 2Mbps).

Nicholas Gruen
15 years ago

Well, you can certainly legislate a procedure whereby it will be sold in 2022. It will then be sold, but not if Parliament repeals or I presume even impliedly repeals the original legislation. But that does make quite a difference – one then needs a majority of both houses to change the course of events from what was provided for initially.