On episode 211 my guests are Dr Phil Burgess, Group Managing Director, Public Policy and Communication, Telstra and Garry Barker, Technology Editor at The Age. We spent an hour at Telstra’s Melbourne offices this morning discussing the state of broadband in Australia.
Phil is often in the news (here are some recent stories) debating the broadband issue with other Australian corporate executives, the ACCC and the Federal Government, but this is a rare opportunity to hear him speak (loudly and passionately) about Telstra’s official position on the broadband debate for an hour.
Thanks to Phil and Garry for participating and to Paul Crisp and Rod Bruem at Telstra for making it happen. I know Phil is a supporter of blogs and podcasts (he is the guy who make Telstra’s ‘Now We Are Talking’ blog happen) so hopefully this will just be the first of many such conversations.
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Did you asking him about censoring his Bloggers? Or did you duck the hard questions? I am 2/3 through it and its been pretty tame so far.
Molly
I gave you an opportunity to submit questions a week ago Molly. I didn’t hear you piping up. I totally didn’t even think about that. I doubt Phil would even know about the issue anyway. I’m sure he has bigger things on his plate.
Yeah, I feel silly now. I can’t believe he is talking about the speed of broadband when the cost no is pretty crappy. Well from telstra anyway.
Molly
Burgess says the G9 is a monopoly.
Internet providers iiNet and Internode who DO provide ADSL2+ & are members of G9 and are NOT overseas companies do not make a monopoly. Optus may be a Singapore company, but it invests in Australia and employs Australians.
Burgess only says what he sees as a boost for Telstra. He is not interested in what’s good for Australians. He uses SPIN ALL THE TIME.
His arguements are illogical.
…Keith Styles
I’m sorry….but what an arrogant wanker!
On the one hand he is talking about looking after the customers first, when in fact he talks mostly about looking after shareholders first.
If they put customers first, why don’t they switch on REAL broadband, and fight the good fight for customers. They don’t because they’re looking after their own best interests.
It’s also pretty well known that other ISPs can’t just add their equipment to Telstra’s exchanges, because they didn’t make them big enough.
It’s also well known that they charge other ISPs too much to lease the last mile.
Hence the regulations, because Telstra is a monopoly…so boo hoo, they have to report to the Government. Well that’s because they were GIVEN publically owned infrastructure.
I have to agree with Rich on some points…
I can also see where Garry is coming from by saying “we have to protect the shareholders.” The shareholders could probably care less about the Australian public’s access to broadband, but at the same time I wouldn’t be investing in anything that the government was going to turn around and just take away from me, or legislate away from me. If I buy an SUV, it is right for the gov’t to pop in and say, “We’re taking your SUV because 17 other people in your neighbourhood also need transportation and can’t afford it. So we’re going to turn your SUV into a bus for everyone in the neighbourhood to use.” Who wants to invest in something only to have it “stolen”?
What I think should happen is that the gov’t should take back all the fiber/infrastructure, etc and set up a public company to run it, and then sell access to use it. While at the same time, the gov’t should be doing the investing in extending the Network and the technology (pipe dreams). Or is that what started the whole mess in the beginning? The gov’t not wanting the responsibility of broadband, but quite willing to point fingers at someone else’s mistakes?
And the guy who said “maybe we don’t really need broadband” needs to get his head outta 1952.
I personally do not have broadband or ADSL to my home because I’m too bloody cheap. I’m not going to lay out over $50 CDN per month for broadband access when I can get 56k modem access for $200 a year. When the prices become a bit more reasonable, I’ll think more about it.
great podcast cam. great to see the big guests on with the big issues. if u get samuel on for the sequel that will be awesome. really well done man. telco is a deep experience market once u get within the middle of it and with a fast talking amigo u just gotta go with the flow. it was great. bb
I travel the world for my work as an adventure guide. I spend half the year on our remote property in the Victorian Alps, Anglers Rest to be exact (where the heck is that!?)…I just listened to your program via broadband in Oakland California. I have The Australian set up as my homepage when I open up my browser. I download AM and PM radio and listen to it in my car on my iPod while driving to work in the States daily. I contact my clients via broadband email daily. I upgrade all of my computer programs via the web, saving time and money in CDs, mailing costs, etc. When I need information, I google it, and can instantly get an answer. I share my photographs with my family on the web, watch documentaries, talk free and see video images of long-lost friends with Skype…you name it.
When I return to Anglers Rest, I pay Telstra hundreds of dollars for the priviledge of installing an antiquated ISDN line, at 265,000 kpbs per second, then pay them nearly a hundred a month for a system that drops me out on a regular basis, and which cuts service by half anytime someone is on the telephone. I simply have no other choice, other than a satellite broadband costing thousands. (By the way…I pay $15 a month for 1.5 megabytes per second in the USA). Personally, I don’t care a hoot who the heck provides the service…what I’d like is for someone in the Australian government to grow a spine and make something happen, as we all know they can when they so choose. I don’t want to listen to the cricket all day long all weekend long on ABC am radio. I don’t want to pay Telstra exhorbitant sums for landline calls. I don’t want to wait for photographs or computer upgrades or information to be delivered by mail on my gravel road twice weekly, or let my computer run all night long to download them. The entire rest of the world laughs at America and our arrogant, idiotic, apathetic governmental policies. Beleive it or not, the same can be said of Australia’s backwards telecommunications and broadband setup. Stop pointing fingers and start making something happen, folks!
boo freaking woo poor old telstra cant get the monopoly they want. The whole ‘blame the regulator’ plan is a proven method used by Sole T to try and get what he wants. He used to be the head of a telecommunications company in the western USA, and he stuffed that company (according to a 4 corners report on the abc anyways) so i really hate to think what he is going to do to telstra.
Dr burgess had no consistancey in his arguements either, one minute he is talking about looking after small business and the customers, 10 minutes later he is talking about looking after the share holders. One time he is talking about allowing free competitiion and in the next breath he is talking about only sharing the telstra infrastructure in the country. One minute he is talking about not knowing the pricing of things and the next he is talking about the cost of providing infrastructure in the outback, all the while carping on about how it is the government regulators fault.
Maybe he thinks that he can spoon out the same tripe he does at home and people will just swallow it, but not this little back duck !!
At one point however he made Telstra’s position perfectly clear. He said that Telstra could turn on your adsl2 connection tomorrow Cam, but why dont they? I put it to you that telstra doesnt want to share the infrastructure the way that the government regulations say they should.
Its simply not in their best interests.
The whole similie of ‘buying a car and then having it taken back off you’ is simply bullshit too. The regulations were already in place when telstra was sold. Surely there was the equivelent of ‘due dilligence’ when the people buying had the oppurtunity of looking the company up and down, have the books examined and be given ample oppurtunity to back out? The term Caveat emptore (buyer beware) surely applies here. the equivelent would be if you brought a car and then tried to take it back because 3 weeks later the clutch buggered up. you wouldnt have a hope in hell, and neith should telstra no matter what court you go to.
Finally, I caught up with some friends who work or have worked in the telecommunications industry for years back in January. Their opinion of the sale of telstra was the same as mine. That 1) It shouldnt have happened in the first place and that 2) the company is being run in the same manner they would run an american telecomms company.
the point is that it cant be run in the same way. The USA is big, but the whole country will fit inside the coastline of the australian continent. They have 300 million odd people (in some cases very odd) and we have just cracked 20 million. The short story is that we do not have the density of population to pay for the infrastructure to bring us up to the same level of comms as the rest of the world. This is where the arguement about us being far behind people like the netherlands, the USA and Japan having 30mb/sec+ data rates falls over. They have it because they have enough people to pay for it. We simply dont.
if we were to take a 1000km run of fibre optic cable between melbourne and sydney and run it across europe, how many countrys would it pass trhough and past how many customers would it run? I dont know but Im tipping it would be a lot more than the 7-8 million in melbourne and sydney.
The cost of fibre around the country is high its true but it would be cheaper for government employees to do it than to have a private company do it, because after all they do have their share holders to consider.
Just my 2c
J
iiNet and Internode may be Australian (so is Telstra) and Optus may employ Australians and invest in Australia, but the fact is that they invest the barest minimum to get by. Why don’t they invest multipiles more and build their own network and stop leeching of Telstra. Telstra invests more and employs more Australians then any of its Competitors. If the Government wants to steal Telstra’s network then it should have not privatised the company. It should have held onto it as a Government Department and THEN provided access, at cost, to the other companies. Of course it would never have done this because as an owner it would not have wanted to compromise it’s budgetry position. Everyone likes to complain about Telstra, but why don’t any of you complain about the fact that none of Telstra’s competitors are willing to invest in their own stand alone network and provide Australians with an alternative. The problem is not with Telstra. The problem is that the competitors want a free a ride, with Telstra Shareholder subsidies.
So, the continental US would fit within the borders of Australia, huh? That’s news to me. Anyone with even a grade-school knowledge of geography ought to be able to tell you that the US is 20-25% larger by land area than Australia is. That’s not the only mistake John makes in his arguments (which he calls “arguements” for some reason).
How is it that looking after customers is inconsistent with ultimately looking after shareholders? How is it any cheaper for a government to deploy fiber than for a private company? As for Sol (whose name you don’t even have the courtesy to spell correctly) – no Board of Directors on the planet would appoint a CEO who did the things which you and the ABC charge him with.
If you disagree, that’s fair enough too – you’re entitled to your own opinion. At least try to get your facts straight though.
Telstra confirmed as a bully.
Holding everybody to ransom and still screaming “it’s not fair” and blaming everybody else.
I get the feeling they are still trying to keep the share price up by picking these fights, which is a long term losing strategy I figure.
Peter, Ok we fall some 2 million square km short on in the geography, yes I acknowledge my mistake, I was at the time trying to remember which way around it was.
Regarding Sol, I stand by everything I said. In my personal opinion the guy is a crook and I think that your right, the only reason why he is out here is because he couldnt find a Job in the USA.
Friends in the industry who are consultants agree with me, that telstra shouldnt have been sold off to commercial interests and that in doing so the new company will concentrate on area’s where they make the most money, the big cities, this will in turn lead to them cutting back services in regional australia.
Telstra will then blame the regulators for their own descisions.
My apulagies in in udvance 4 ene speling mustakes poida, i hoop dey dont upset u 2 mutch
J
Telstra is not holding anyone to ransom. When the Commonwealth Government hands out funding it say’s it’s Commonwealth money and therefore it set the terms. Telstra should be no different. Telstra is willing to invest but is being prevented from doing so. The G9 actually want’s Telstra to invest and build the FTTN, but the G9 wants to set the terms of that investment. In Australia isn’t the term for someone who behaves like this “Bludger”?
No other player is willing to invest at the same levels as Telstra. Look at Optus, it came out and said it would build a 3G network bu t then asks for Government funding. Telstra did it on it’s own.
I understand that Telstra’s legacy network should be regulated. But any new network build by Telstra should be not be regulated. Telstra should not be penalised because it is willing to invest when it’s Competitors are not. Telstra should be allowed to bulid an FTTN and set the prices. If the competitors are not happy with those prices they should then build their own network and set their own prices. The consumer then has a choice and choice drives down prices. That’s how competition works. Bludgers should not be rewarded by the ACCC or Government.
I would really like someone to explain to me how broadband will assist agricultural exports. I’ve heard this example used for the past 7 years and not seen one illustrated example of how it could be used.
“Fiber to the home” will never happen in rural Australia. ADSL is never going to happen to rural Australia. Never happen. My parents live 15 minutes from a town in Western Victoria and have a 14kbps dialup internet connection. Thats right. 14kbps. Not 56kbps. Not 28.8kbps. 14kbps. Why wont this be ADSL enabled? Because they have 7 houses on that telephone exchange.
Next G doesnt reach either. 98% of population my arse. I’m curious to know exactly what methodology they use to come up with that stat. And the pricing for Next G is bollocks. It’s more insain than satalite. Reduce your advertising budget by 100 million and then you can reduce your access prices, and increase your included download limits. Reduce the cost for the consumer to adopt the technology, your uptake will be quicker and larger, get away from this stupid bloody idea of “video calls”, and give up on the limited content environments (with $5.50 AUD access to a 30 second ABC news clip) and apply it to a real world application like UN-FILTERED INTERNET ACCESS. Give the consumer what they want. Stop trying to tell them what they want.
There is dark fibers snaked all around Victoria into regional towns. Light it up and attach it to WiMax. Give us the coverage. Give us the speed. Make it affordable with 20GB plans for $50AUD in regional towns (match the price of current ADSL) and you solve this access problem in regional Victoria.
Then the whole of Australia can watch cats singing on YouTube.
Enjoy.
POINTS TO THINK ABOUT!
1. Yes Telstra does cares about it’s Share Holders.
2. Yes Telstra does cares about customers (NO Customers NO Company, seems a fairly basic concept to grasp)
3. Telstra wants TRUE competition! (A level playing field)
4. Only a fool would build something then let someone else use it for less than it costs to run. If you believe they should next time you buy a house can i rent it for 50% of what it will cost you to maintain it)
5. Finally for the first time in many years Telstra is going places, building networks ‘NEXTG’ it has a plan and a future. But is hamstrung by outdated legislation which stymies competition. AND
6. Yes I am a Telstra employee, not in management, just a passionate believer in our companies future and direction.
Hey Kelvin – thanks for your comments and for owning up to being a Telstra employee. I guess what we all want to see is open and fair competition in this country as well as first-class communications infrastructure. In the past, Telstra hasn’t done a great job on either of those, so it’s understandable that there is a high degree of suspicion about Telstra today. Phil can protest that its under “new management” now, but most of the employees are still the same old baggage that screwed it up over the last 20 years and old habits die hard.
That said – once the government sold it off, I think the ACCC needs to apply the same competition rules it would to any normal publicly listed company.
Greater services come from greater investment. How much investment does Telstra invest in this country vs it’s competitors? answer – Telstra invests more in network in one year than major competitors do in 10yrs!
Why would competitors invest here if they can rely on making profits off Telstra and Telstra shareholders put up the risk?
The Universal Service Obligation is a fund to provide basic services to Australia. 10 years ago the cost of this was valued at $540m per annum. Currently the fund is $150m, 10years later of which Telstra pays the majority and then also has to foot the bill to pay the near $400m gap. How can this country move forward when our government lives in the past?
Exchanges have enough room for competitor equiptment.
Howard & Coonan doesn’t want to review for another 3 years! Labour have said they will review when they get into office. Does Howard & Coonan want to move this country forward or just stand on stubborn ground?
You don’t have a competative race when all the runners are on one runners back. When will Australia be proud of a leading Australia company? Every other icon goes to overseas ownership. It’s time we get off the tall poppie syndrome in Australia and start backing Australian.
Is Telstra a monster company – it’s major competitors are far bigger – It’s about time THEY start treating Australia seriously!
You don’t get good services and pricing until you have real competition. We don’t.
I would have liked to have seen an interview with Burgess and anyone but Gary Barker. Someone else more knowledgeable in the issues would have been great.
To followup my rather aggressive post earlier this month, I have found one use for broadband in agriculture.
http://adoptasheep.blogspot.com/
This Australia wool farmer has been adopting out his sheep for $35 (hundred days of feed).
More singing cats.
So Graeme, who is Telstra blaming, the ACCC for holding back the progress that could be made by using tax payers money. Its not so wrong really when I look at myself and know that I have been on the end of the dole queue for more than 10 years struggling along with the rest and then guess what? Low and behold I am taken in by a centre for Telstra customer service and here I am working and supporting myself and learning more about technology than I ever thought could be possible.
I have been a customer of other telecommunications companies and that was my choice but I am back with Telstra now and know that our centres are here in our own country employing people here and that is what everyone needs “A Job”.
That is only my opinion of course and every one has a different experience.