Telstra has decided to proceed and upgrade its Cable network to offer 30Mbps.
But, it didn’t stop there however, it has decided that it will only upgrade the speeds to 30Mbps and offer those speeds to 67% of the population, again, something Telstra are specialists in, is limiting the service a consumer can get.
This news was used by Coonan’s department to slam Labor right into its place, showing further that it’s proposal to take taxpayer funds, and do something that the private industry is keen to do by itself more and more, is a great display of poor decision making (and they aren’t even elected yet).
Here’s the flipside to that though, I do see clearly where they are coming from. If they get a network built out as far as they can get it to be, then they are bringing the entire nation ahead of its time and are future proofing themselves.
What they must consider at this point is, perhaps FTTN isn’t the technology for regional areas, and perhaps the same is true for metro, perhaps the true technology to be used is FTTH.
The real news about FTTH isn’t that it’s future proof to a point where communications will be faster than the human thought process, or communications could be faster than our machines can physically cope with, but rather, a message is sent right back to Telstra.
If they don’t co-operate and participate as an active member of the telecommunications industry, the industry can easily stick them in their place by rolling out a fibre to the home network that clearly should tell Telstra to stick its copper where the sun don’t shine.
That’d cause them a mass, no beyond mass, an extremely painful situation with revenue loss exceeding profits and even revenue loss exceeding resale asset value.
The copper network as they know it could in a matter of just months lose more than 20% of their revenue and over the period of a year dig deep into their overall revenue and profit, therefore sending their overall performance down the drain.
That’d be bad news for Telstra and all of its shareholders.
They’d have just their mobile network and whatever loyal retail customers they can hang on to.
I should add here though, they claimed they added more customers to their broadband services, and the performance of the NextG network has been strong enough to hold off complete starvation and offset any overall loss.
But people should note that there were times where Telstra was making $4bn.
Telstra should also be making much larger profits now too, after sacking of staff and overall cost transformations.
Sol doesn’t deserve a bonus just yet in my opinion, the performance has yet to be demonstrated in full. The cutbacks on costs haven’t been fully reflected, and all he has demonstrated really is that he has been able to deceive many more Australians into signing up for excessively priced broadband, and using taxpayer funded CDMA infrastructure to offer NextG services, which it has had some success with, likely due to those wanting access on the run, or those it sold short when it used Pair Gains systems or those that can’t get broadband taking NextG services as the service of “before last resort”.
He can deserve a bonus when those marks move more solidly, when you see profits increase due to those staff losing the jobs, when you see profits clearly show the gain made from cost realignment.