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    Broadband wars

    Tuesday, September 18, 2007

    The past couple of weeks have been rife with tension concerning broadband in the legal and political arenas with a trail of court action and political upheaval over Australian broadband blazing in the media.

    The first such print worthy news was a court case involving a man by the name of Brian Burbage who successfully launched an attack on ISP Netspace for unilaterally transferring Mr Burbage and other customers from an “Unlimited” plan to a new “Fair Go” plan albeit with different usage restrictions. Interestingly, Netspace was not represented at the hearing due to a “communications mixup”.

    Certain commentators in the media have opined that the case does not set a precedent for other ISPs. Yet the case, at least in my opinion, follows basic principles of contract law that have been established since the dark ages of dial up and in other previous archaic times. Basic contract law states that for a legally enforceable binding contract to exist, several components are necessary, including an “offer”, an “acceptance”, the passing of “consideration” and the meeting of minds. ISPs should ensure that they comply with these basic requirements and like Netspace, at a minimum, ISPs who unilaterally change their terms should provide customers with at least the option to exit the contract where they do not agree with new terms. ISPs should be careful that they comply not only with these basic rules of contract law, but the myriad of laws, codes, rules and regulations that form the regulatory regime governing ISPs and telecommunications providers.

    The other ISP-centric news that rocked the media recently commenced with Opposition Leader Kim Beazley's reply to the Budget in relation to the slow broadband speeds plaguing the nation. All will agree that Australia's state of broadband is well behind according to international standards. In the US, for example, media convergence in the form of triple play and robust ad hoc networks are commonplace, while in Australia, ADSL2+ is only starting to take off.

    According to Kim Beazley, “Australia's use of broadband lags far behind other nations in the developed world. The latest OECD figures rank Australia's broadband take up 17th out of its 30 member countries. Further, Australians pay the fifth highest prices for telecommunications in the OECD.”

    There are several options on the table for rectifying what Kim Beazley has described as “fraudband”. The first option is Telstra's planned $3 billion optical fibre network. The second is a plan put forward by seven of Telstra's rivals and at least one other major alternative broadband network is also in the pipeline. The “rival network” backed by Kim Beazley has been described by Senator Connan, Minister for Communications, Information Technology and the Arts as “Broadband Banditry”. It will be very interesting to see the outcome of this broadband war indeed.

    What is certain is that the next 12-24 months will bring new opportunities to broadband providers, resellers and suppliers as a result of the deployment of new technologies facilitating faster speeds. These opportunities require extensive analysis in order to evaluate their advantages and disadvantages. Broadband players will need to reassess their business strategies in light of these new opportunities and any new plans, technologies and investments will require an update to the internal and external legal documentation of all affected in the channel.

    Disclaimer: This column is for general informational purposes only. It is not legal advice nor is it a substitute for legal advice. Readers should seek legal advice on their own particular circumstances. Alan Arnott is a technology & telecommunications lawyer with qualifications in computer science and law with Arnotts Lawyers in Sydney. For more information, please visit www.arnotts.net.au.

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