The Morrison Government continues to contradict itself on the National Broadband Network (NBN), simultaneously promising to enhance competition while also taxing competing internet services. From veteran telecommunications analyst, Paul Budde:
The Coalition Government is creating greater confusion about its telecoms strategy going forward. On several occasions, the new Communications Minister Paul Fletcher has indicated that he would like to stimulate more competition in the Australian telecommunications market. Fletcher has been quite cagey about how he intends to do that while at the same time, continuing to support the NBN Co monopoly.
On the one side, the Communications Minister launched a review of the ‘Telecommunications in new developments’ policy, which dates back to 2015. Again, he indicated that he doesn’t expect major changes, but wants to see if improvements are possible.
In the past, competing operators such as OptiComm have protested about what they saw as unfair competition from NBN Co…
But a week later, Fletcher announced the revival of the proposed broadband tax for users on competitive broadband networks — a whopping charge of $7 per month. This is clearly aimed at entrenching the NBN monopoly rather than creating competition. The tax is specifically aimed at companies such as OptiComm and Uniti. So much for a clear strategy on competition and on safeguarding competition.
Blind Freddy can see that the primary purpose of the $7 per month levy on competing services is to entrench the NBN as the monopoly internet provider for the nation.
Paul Fletcher disputes this claim, stating that the purpose of the levy is to “fund the losses NBN Co incurs in constructing and operating its fixed wireless and satellite networks, replacing the company’s opaque internal cross-subsidy from its fixed line networks”.
Even if that is true (which it isn’t), it goes against the Productivity Commission’s 2017 Telecommunications Universal Service Obligation report, which recommended against funding universal service obligations (USO) via levies:
The Australian Government should fund targeted measures to meet telecommunications universal service objectives principally through general government revenue rather than an industry levy. This would imply the ultimate removal of the Telecommunications Industry Levy.
Clearly, the Government is trying ensure the NBN meets its revenue targets, thus preventing its value from being written down and blowing a hole in the federal budget.
The fact that Australians will be charged excessive user fees for sub-standard service is a distant concern.