Networker: Dreams of abundance
In just a few weeks Canberra residents will have access to digital
services that “the rest of the world can only dream about”, according to
former Australian Capital Territory (ACT) chief minister Kate Carnell,
quoted in the Canberra Times.
Now national development manager for TransACT, Carnell was talking about
the new broadband services that will be rolled out across the capital over
the next few months. As well as TransACT, ACT residents can sign up to
the Foxtel satellite based service, or a range of Telstra services.
TransACT promises some exciting new offerings. For example, you will
be able to watch all the free-to-air television stations, you will be able
to connect up to telephone services, and you will be able to log on to
the internet. In her enthusiasm Carnell failed to notice that she was trying
to sell people things they already had. It isn't her fault, however. Most
business in this area is simply fighting among various companies for limited
customer dollars.
Competition is aggressive. Modern technological development mean that
it is possible to deliver similar services in many different ways.
Telephone calls can be made via the traditional fixed line telephone
network. Or you can use the mobile network (if you want to pay a lot more,
sacrifice service quality, and take a slight risk of brain damage). Or
with a little bit of fuss you can log on to the internet and use that instead,
especially for expensive long distance calls where you don't care much
about quality. Or you can use some sort of device connected to a cable
television service and make calls that way. About the only option you don't
have is to use satellite services (these were tried but the delays made
them very unpopular).
If you asked the question, what is the best network for making phone
calls, the answer is usually whichever is most convenient or cheapest for
the user. But in a world where several service suppliers are competing
for market share, the price they charge the customer has no relationship
to the actual cost of providing the service.
Similarly, what is the best way to get a television signal? Here the
choices are to pick it up from a local transmitter, buy a satellite dish
and get it from space, get cable television or get it datacast over the
internet. Once again technology has provided a range of paths for you.
As with telephone calls the cost in each case has no relationship to anything
but the aggressiveness of the marketing campaign of each television path
provider.
Internet access is a third example, being available over telephone lines
or cable television connections.
It is said that the free market promotes efficiency by rewarding those
companies that provide services most efficiently. This is generally not
true (because of collusion between the largest companies). In the case
of telephone, television and internet services it is also false. There
is now massive overcapacity in these services in Australia and other rich
countries.
Efficiency will have nothing to do with determining which technology
or path dominates the phone, television and internet delivery sectors.
Instead it will depend on which companies have the deepest pockets, own
particular technologies, and have the most power over politicians. About
the only thing that can be said for sure is that the outcome won't be efficient
or rational.
BY GREG HARRIS (<gregharris_greenleft@hotmail.com>)
