Guest post: What iiNet's Steve Dalby gets right (and wrong) on the NBN

At the recent Broadband World Australia 2008 summit, iiNet’s chief regulatory officer Steve Dalby claimed that the proposed National Broadband Network is shaping up as little more than a $5 billion dollar hole in the taxpayer’s pocket.

Dalby's suggestion of placing the NBN under the control of a separate, non-retail legal entity is definitely a worthwhile proposal, and one that could avoid any monopolistic behaviour from Telstra or its rival. Steve, I commend you.

But here’s where Dalby loses me: his proposed alterations also include an “outside-in” approach to rolling out the NBN infrastructure, starting with the rural regions and moving towards metropolitan areas once the infrastructure’s reliability has been tested.

Call me selfish, but does this really seem like the best idea? It seems that these days, the majority of Australia’s Internet policies have a key focus on the outback, as if all of life’s problems will magically disappear once farmers have high-speed Internet. Dalby’s proposal fits right in here, along with image of an Aussie battler conquering the outback, with “I Still Call Australia Home” hitting a crescendo.

Don’t get me wrong, I’m all for equal Internet access, and I believe there needs to be legislation in order to ensure that whoever wins the NBN contract rolls out the infrastructure in Australia's urban and rural regions. That’s no issue.

In reality though, where the majority of Australian Internet traffic occurs in urban areas, would an outside-in approach really work? It just seems illogical to give farmers access to the highway at 110 kilometres an hour when you have thousands upon thousands of investment bankers crawling on top of each other in a 40 kilometre an hour zone.

We all want to see a faster Internet service. Unfortunately, it’s a pipe dream travelling into reality at about 28.8kbps with the government simply injecting more promised money and little yield to show for it. With discussions focusing squarely on pricing that benefits the consumer, but no subsequent initiative, it’s a cause to wonder whether the issue is pricing at all or whether the National Broadband Network is yet another government-backed time waster.