[LINK] NBN pricing may dull broadband benefits: economist

[Jan Whitaker]

At 02:16 PM 9/03/2013, Kim Holburn wrote:
> >
> > NBN Co is offering five different speeds at different prices, 
> which telecommunications consultant and former Telstra chief 
> economist John de Ridder says is artificial because, once the 
> network is built, it does not cost more to deliver 100 mbps over 
> the NBN than it does the slower speeds.
> >
> > "They could offer the same speed, unlimited speed basically, to 
> everybody but they choose to ration it out, charging more for 
> higher speeds," he said.

I heard this story on the radio and my ears perked up in 'danger Will 
Robinson' mode as soon as I heard this: "former Telstra chief economist".

The argument he is posing is exactly what Telstra could do as well 
(take off the top and charge the same), and I guess some might argue 
that the do on their HFC cable service is you can get that, assuming 
you aren't sharing it with everyone else in the neighbourhood. I 
haven't look at their data quotas, if any, though. *Surely* he isn't 
criticising the NBN for presenting a business model decision that 
might recoup some costs of the investment? Surely he wouldn't say that.

I would gladly pay $50/month for the fastest speed because that is 
equivalent to the cost for my current 'can only get' 8Mbps speed on 
ADSL (not 2+ mind you because TELSTRA won't upgrade the local switch 
from shared RIM service so I have a choice). I wonder if de Ridder 
advised Telstra on that little decision......

Jan



Melbourne, Victoria, Australia
jwhit at janwhitaker.com
blog: http://janwhitaker.com/jansblog/
business: http://www.janwhitaker.com

Our truest response to the irrationality of the world is to paint or 
sing or write, for only in such response do we find truth.
~Madeline L'Engle, writer

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