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2013-09-23

NBN should not be a monopoly

Comments on Alan Kohler "The NBN board has run away. Why?", 23/09/2013, http://www.businessspectator.com.au/article/2013/9/23/information-technology/nbn-board-has-run-away-why

Alan, while your analysis has obvious merits, there are ways both to allow competition and to make the NBN profitable you have not considered.
Competition is to create a level playing field for all participants and not to create entry barriers. As long as NBN is not allowed to be a monopoly and treat it and other competitors equally, competition can be achieved.
While NBN profitability is dependent on the level of cross subsidies from urban to rural areas, this could arguably be achieved through, say, a national charge to all suppliers to urban areas including both the NBN and non-NBN ones. The income from this can be used to subsidise rural users or suppliers to rural areas.
The upshot that is most important is to allow competition for innovation and efficiency. Other policy objectives can be achieved through other means.

Under this framework the Coalition's NBN policy may not necessarily create a board problem for any NBN Co. Further, the Coalition government is unlikely to ask any board to do the impossible.

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