The monopoly NBN - so good, we're borrowing money to pay to get people to sign up
Only this government could build a monopoly fixed line network that needs incentive payments to get people to use it.
You may have seen coverage over the weekend of a bounty, or incentive payment of to telecoms re-sellers for every customer they sign up on to the NBN before June this year.
It begs the question why? Why would we need to pay an incentive payment to sign up customers if the NBN is so good. It's a monopoly, protected from fixed line competition and with the added incentive of Telstra shutting down its copper network once the NBN passes premises. How can this be anything other than a device to make the numbers look better?
Keep in mind that the federal government treats the NBN as a profit-earning investment. The money borrowed to fund the NBN is not shown on the Federal Budget - so the logic goes like this. We borrow money to build the monopoly NBN because it's so good and necessary. Then we notice that not enough people are signing up to it. So we borrow more money to pay a bounty for each customer that signs up.
The Australian broke the bounty story over the weekend and Leo Shanahan of The Australian has spoken to Stephen Conroy about it.
Conroy won't comment on new strategy's success
- BY:LEO SHANAHAN
- From:The Australian
- January 28, 2013 12:00AM
COMMUNICATIONS Minister Stephen Conroy has failed to say whether a new attempt by the National Broadband Network to boost its subscriber base by offering internet providers cash for every new customer will result in price reductions for consumers.
As revealed in The Weekend Australian, a new strategy to attract users to the $37.4 billion tax-payer funded network will see internet service providers like Optus and Telstra paid $108 for each individual customer that signs up to the super fast broadband network.
The payments will be made to providers from January to June this year, in an attempt to enable NBN to pass its goal of 341,000 premises and have 54,000 actual customers by June.
In defending the payments yesterday, Senator Conroy described the new incentive scheme as legitimate "marketing activity" that is consistent with the NBN's corporate strategy.
"NBN Co is engaging in marketing activity in the same way any enterprise does. This is not activity outside the expected operation of NBN Co as outlined in its corporate plan," Senator Conroy told The Australian in a statement.