Musings on NBN take-up, landlines.

In an effort to further encourage take-up of new Fibre-to-the-Home (FttH) services - let's call it the NBN - the Department of Broadband, Communications and the Digital Economy has confirmed that opting out of a fibre connection could see you lose access to basic landline phone services.

Given that the deal between NBN Co and Telstra will see the existing copper network decommissioned, this hardly seems like news (unless you happen to be in the Opposition or writing for theMurdoch press where a perpetual state of outrage prevails). Malcolm Turnbull, in one of those 'gotcha!' moments that characterise oppositions everywhere, announced that it was "the government's plan to make the NBN a monopoly provider". It's hard to argue with that, which is probably why no one has been. In fact, it's kind of the point.

Anyway, back to those landlines. Under the Universal Service Obligation, Telstra is required to provide a basic telephone service to all Australians. For this they are duly compensated by the federal government. However, under Telstra's $11bn deal with NBN Co, this obligation would pass to the latter for all areas serviced by the new fibre network. By joining the dots - there are only two of them - we can surmise that in order to have a landline phone, you'll need to connect to the NBN. This suggests that fears about poor take-up of the network are ultimately groundless. Minister Conroy declares as much here.

Nonetheless, the take-up rates have been pretty low thus far in Tasmania, where the NBN is already being rolled out. Faced with this, the Tasmanian government switched from an 'opt-in' model to an 'opt-out' one. It is certainly more efficient from a man-power perspective to simply connect everything now, rather than have to go back later when people decide they really do want fibre. 

But there's more to it than that. There's simple apathy, of any number of potential customers who just can't be bothered. This was always going to the be the case for the NBN, whose future benefits are mostly too nebulous and remote for the average user to base decisions on. To put it another way, an 'opt-in' model allows customer apathy to work for the NBN take-up target, and not against it. To this measure they have now added the threat of losing your fixed phone service if you opt-out. One way or another, they will hit those targets. One way or another, we will have a monopoly wholesaler.