There are two sides to Labor’s broadband plans – the substance and the politics, including corporate politics. Unfortunately it is hard to separate the strands, but make no mistake, we are talking about the future well-being of the nation.

Planning to build a decent broadband network is undoubtedly excellent, nation-building policy, likely to make the Howard Government’s piecemeal approach look tired and old fashioned.

It is easy to see how this will form one of the foundation stones of Labor’s bid for Government. Decent broadband is a frontline issue and relevant to every other important area of policy.

Broadband is vital for economic growth, for small business, for educational opportunity and for good health care, particularly in the regions. I suspect there are many young people and rural residents, not to mention those in the “wired for action” McMansions in the outer suburbs, for whom the message “Labor means faster broadband” would alone be enough to turn their vote.

Fast broadband is also the frontline for media diversity. Once broadband speeds reach the levels proposed by Labor, the ice age will have arrived for our existing free to air television networks’ business models.

Concentration of old media ownership, and the question of whether or not to grant a fourth commercial television licence, will become less important as consumers are able to access a world of video content on demand. There will be lots of opportunity for new players.

Things are changing fast. Last year downloading media content from the internet became mainstream behaviour. Nielsen Australia’s Internet and Technology Report for 2006-2007, showed that more than half of Australia’s internet users have already downloaded audio content, and more than a third have downloaded video.

Once internet speeds make downloading video seamless, almost everyone will be doing it. Free to air television will no longer be able to draw big audiences for scheduled drama when the same programs will be available on demand over the net. The ABC will also have to consider its future. Why fill the schedule with BBC imports when they can be downloaded direct from the maker?

All this could be very good indeed for media diversity – but the worry is that Telstra is the company in the box seat to both build the new broadband network and deliver Internet Protocol Television. Telstra is likely to become a media proprietor to make all others look puny, owning both the rights to premium content and the main means of delivering that content.

Make no mistake, Telstra, with its half share in Foxtel, buying up of content rights and numerous internet protocol television options under consideration, is well advanced in planning for the possibilities.

Would Telstra be prepared to use its media power? Would it be in favour of plurality and a diversity of views?

Have a look at its campaigning on the nowwearetalking site, not to mention the shameless use of its billing mail outs to conduct its campaigns, and you’ll be left in little doubt that in pressuring politicians and advancing its commercial interests Telstra is prepared to do, as Graham Richardson would have put it, whatever it takes.

Communications Minister Helen Coonan has been accusing Labor of cosying up to Telstra. Certainly Telstra’s rhetoric suggests that it believes there will be a change of government come election time. If Telstra is wrong about that, they will have major ground to make up with the incumbents.

Is Labor in bed with Telstra? We will have to see what Labor plans to do to make sure the tender process to build the broadband network is fair. No easy thing, when Telstra still owns the essential copper wire and is prepared to use its power to stymie competitors.

The other reality check will be when we see the detail of how Labor plans to regulate Telstra. So far it has made only vague promises of regulatory reduction and review. This is a vital media regulation issue, not only a matter of telecommunications regulation.

There is little point in revisiting the Telstra privatisation debate at this stage but its worth reflecting how much simpler things would have been if Telstra’s infrastructure had remained in public hands, and only the business of selling services sold off.

Then Government would have been in the box seat in negotiating Public-Private deals to upgrade the infrastructure, and could have guaranteed open access for all.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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