THE explosion in the use of wireless broadband has undermined the rationale for the $43 billion national broadband network, according to the Federal Opposition.
The claim comes as Telstra waits to see what punishment the Government will inflict on it through legislation that BusinessDay believes will be introduced to Parliament today.
The legislation will outline the regulatory measures the Government will impose on Telstra to increase competition as the new network is built.
The prevailing opinion seems to be that the Government will enforce a functional separation of the telecommunications giant's wholesale and retail arms, but will not force it to sell its 50 per cent stake in Foxtel or the high-speed cable network it uses to deliver pay TV.
The Australian Competition and Consumer Commission is likely to be given greater powers to make binding pricing decisions.
It is less likely that legislation covering the broad shape of the network, including the access regime, pricing methods, ownership restrictions on private sector investors and arrangements for the Government's proposed sale of the network five years after its completion will be introduced.
The Bureau of Statistics yesterday released figures showing that the slice of the broadband market captured by mobile technology had increased by 51 per cent between last December and June.
''Labor wants to spend up to $43 billion building a fixed-line fibre network to serve 90 per cent of the population, but has no idea what level of demand will even exist for these services when and if the network is ever built," Opposition communications spokesman Nick Minchin said.
''History is full of failed and costly examples of governments trying to pick technology winners. Labor's NBN will take at least eight years to roll out and could prove to be the biggest white elephant of all.''
But industry observers say wireless will never replace fixed-line broadband.
