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National Broadband Network: Opportunities for ICT Suppliers?

by Staff Writers •
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Following the NBN bombshell, the ICT industry is waiting for the dust to settle.

The ICT industry is trying to understand what the NBN announcement means for them. While most of the discussion to date has been about political issues around the announcement, there’s also the untold story about how the project will unfold administratively.

Clearly, there will be major opportunities for ICT suppliers, in the build of the network, supporting its ongoing operation and – most important of all – in terms of the extensive range of services and applications it will support.

As announced, this will be the biggest infrastructure project in Australian history, involving an investment of $43 billion over 8 years by the Federal Government and an as yet unknown set of private sector partners.

Only broad-brush information has been provided so far, and it might be weeks or months before the Government clarifies all the arrangements. A project of this size, which has serious implications for current telecommunications market structures, will inevitably reveal many devils in the details.

It’s clear such a monumental infrastructure project will have significant implications for traditional suppliers to the Federal Government, apart from the traditional telecommunications suppliers who might be directly involved in the rollout itself. It will also affect how government provides and delivers services, and the role of the private sector in developing and supporting these.

The Federal Government has announced it will initially own and maintain a majority stake in the NBN provider well into the 2020s. However, it’s not clear what type of entity is envisaged, and what elements of the construction, operation, management and regulation of the new network it will be involved in.

For example, whether the new entity is a CAC Act agency or a stand alone company will have significant implications for the way it procures goods and services for this major project. There’s also the question of whether the entity will be a purchaser/provider or whether it will subcontract all or most of the work to suppliers.

Before any of those questions can be answered, there’s a need for the Government to clarify how the project will be initiated. It must avoid last century’s mistake of bestowing the Department of Broadband Communications and the Digital Economy with the conflicting roles of owner, policy-maker and regulator. This initially suggests an entity separate from DBCDE, working in parallel with ACMA and the ACCC, and capable of negotiating a clear position with Finance and Treasury.

With such a major project, the telecommunications regulation infrastructure will need to be ramped up, with new administration, employment/skills and policy development implications. The Department of Broadband, Communications and the Digital Economy recently issued a discussion paper and called for submissions on reforming the telecommunications regime, particularly during the transition to the NBN.

There’s also the question of how much of this project the Federal Government will hold onto, and how much will be delivered through state governments but there is no doubt the project will require additional Federal public service staff, with the associated ICT systems.

The NBN project announced by the Government last week represents the single largest, and most important ICT infrastructure program in Australia. It is of global proportions and will have implications for all ICT suppliers.

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