August 5, 2016
It seems like more and more U.S. cities and states are experimenting with government-owned internet networks (GONs). Some are building middle mile networks that other providers can connect to in order to provide service to consumers. Others are going all in—building and operating taxpayer-funded networks that sell service directly to consumers.
As the Coalition for the New Economy has documented on its website, many of these networks have failed, or are failing.
Thankfully, U.S. taxpayers haven’t seen a government broadband experiment on a national scale yet. But Australia has. And, according to the Technology Policy Institute (TPI), which last month released a study on Australia’s National Broadband Network (NBN), what’s resulted should be a cautionary tale for U.S. leaders at all levels of government.
According to TPI, NBN was ambitious. The wholesale network:
The Institute is blunt about whether NBN has achieved these results. It says, “Six years after its start the overall outcome has not been positive.” The TPI found that Since NBN implementation:
The TPI concludes, “The Australian case reveals how state owned broadband might not be the best answer to meet full coverage and competition objectives” and argues “The NBN is an example of an intrusive policy subject to political pressures that has resulted in inefficiencies that distort consumer patterns and investment decisions without changing the competitive landscape.”
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