iiNet says broadband network is a waste of money

A warning was recently issued to a Senate Committee by Michael Malone, the managing director of iiNet that the National Broadband Network is wasting $5 billion in money from the taxpayer and is a huge and monumental failure that is doomed to fail.

The lack of focus on the customer and the fundamental flaws in the current process and policy from the government would more than likely mean that most Australian customers would end up paying more for their broadband and would not see any improvements for this extra money, said Mr Malone, and added that there was even a very real risk that the network may not even get built.

Mr Malone said “While the Government’s policy was borne from good intent, it is now clear the Government has forgotten about the customers somewhere along the way. They have misunderstood the need for regulatory policy reform and mishandled the process so badly that it is doomed to failure before it’s even begun.”The first priority and only test of the success for the NBN is that customers must be better off from it being built.”
With investments made in iiNet’s own infrastructure, said Mr Malone, like over 300 exchanges that now have DSLAMs in and other existing infrastructures that can be accessed competitively we are able to supply over 90 percent of metropolitan based Australians with ADSL2+ connections offering well above the average NBN promised speeds of 12Mbps.

He said “If customers end up paying more for a slower product than they are receiving today why is the government wasting almost $5 billion of taxpayers’ money?,”

The Senate Select Committee on the National Broadband Network were also advised by iiNet that the ability to offer equivalence in a range of areas by separating the operation of Telstra had failed.

To allow for strong competition and a guarantee of accountability, Steve Dalby, the chief regulatory officer for iiNet said that the need for the NBN to be operated and owned by an entity that was both structurally and legally separate from any retail operator with a revised regulatory regime was absolutely critical.

Dalby said “The Government’s failure to prescribe this under the current tender process has resulted in the small number of tender bidders and the uncertainty means existing carriers are under investing in the current environment.”