Tuesday, April 7, 2009

Universal Broadband: Not Cheap

People who talk about broadband infrastructure investment in the United states need to read this story about Australia's decision build a nationwide broadband network. The government will spend $43B AUS ($30.6B USD) to get the equivalent of a Verizon FIOS subscription to 90% of Australian households. This in a country with one fifteenth the population of the United States. When you consider that expensive part of a broadband network lies in the "last mile"—the cable running from telephone exchanges to the home—odds are that the tab for an equivalent investment in the United States would run into the hundreds of billions of dollars. Even spread out over ten years, this is no small undertaking; $15B a year for ten years is on par with the budget for NASA ($17.4B), so we are talking about creating a fairly large agency or drastically expanding the FCC in order to oversee the buildout.
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