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The bush battles to stay in touch
KENNETH DAVIDSON
Monday 27 March 2000

THE telephone is a necessity. It is impossible to function in modern society without access to a telephone. It is the major artefact in modern society that breaks down isolation, in the city as well as the bush.

In the bush the telephone is especially important. Bob Katter, the North Queensland member of Parliament, was not exaggerating when he said that out in the bush the existence of a functioning telephone can mean the difference between life and death.

At least when something goes wrong with the telephone now, people know who to blame and who to turn to to get it fixed. Would a privatised Telstra - driven by the bottom line and without a Bob Katter to create a storm where the interests of small customers are being ignored - give the bush the same level of service as a majority publicly owned Telstra?

The fact is there are about 40,000 households in remote areas whose telephone service costs Telstra a net $6000 a year to provide and there are a further two million Telstra customers in rural areas throughout Australia who contribute very little or nothing to Telstra profits.

The bush has every reason to suspect that unless Telstra continues to be majority-owned by the Government or is subject to stringent regulation, Telstra will begin to run down services to customers who are not contributing to shareholder value, in favor of the most profitable services to customers who just happen to live in the capital cities and larger country towns.

In order to meet this well-founded fear, the Minister for Communications, Richard Alston, announced last week that the Government would divert $150million from the sale of the second tranche of Telstra to finance a tender for a demonstration program of how potential carriers would provide untimed local calls in remote telephone areas.

Why? The 40,000 remote-area customers pay 25 cents for each 4.5minutes of a local call during the day, and less at night. By comparison, all other telephone users pay 25cents for each untimed local call irrespective of whether the call is made during the day or night.

According to Telstra statistics, the average customer makes 3.3 local telephone calls each day and the average duration of each is 3.5minutes.

These statistics suggest the customers in remote areas are not unduly disadvantaged compared to the rest of Australia in respect of local calls. Providing their calls are less than 28per cent longer than the average call in the rest of the country, they suffer no financial penalty. And if they can delay making these calls until the evening, they are actually better off than their city cousins.

On the assumption that the duration of telephone use in remote areas is the same as the rest of the country, there would be little additional cost to Telstra (or the taxpayer) if the time limit on timed local calls in remote areas was abolished.

But even if we assume remote-area customers make five local calls a day and the average duration of each call is nine minutes, the cost of introducing untimed local calls is only $456 per remote customer, or $18million a year.

So why is the Government wasting $150million of taxpayers' money on a pilot program to find "innovative methods of service provision, including satellite technology" (according to the ministerial blurb), in order to save something between nothing and $18million a year?

The service already available to remote areas is comparable to the service available in Canberra, which - like the bush - doesn't have broadband and therefore must get pay TV via satellite.

Satellites? Alston can't be serious. Iridium has lost $4.5billion because it could find only 50,000 customers around the world prepared to spend $3 a minute on satellite calls.

The 40,000 Telstra customers spread over an area larger than Western Europe get an excellent service now because the network was built when Telstra was driven by national interest considerations. Fully privatised, Telstra will be totally driven by profit - and their ain't much profit in the bush.

Kenneth Davidson is a staff writer.

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Comment:
I reside in a bush region and daily do ISP work. Let me say our Telstra service looks good on paper, but is awful in actual fact. Whereas the city ISPs pay $175 for a 64 kilobute line we pay $1100 for a similar line that oscillates in quality from fast to mostly bloody slow to nothing at all. It's been noticably getting worse since Christmas. The service is so bad it made the local newspaper frontpage last Friday with a headline that read "Internet Fiasco". Satellite access is unusually variable too since late last year. We're battling to stay in touch all right....

Regards from OZ

-- Pieter (zaadz@icisp.net.au), March 28, 2000