When Australia’s Labor Party-led government announced the launch of the National Broadband Network (NBN) back in April 2009 – at a time when the party was still massively favoured to win re-election in 2010 – they could scarcely have thought that the NBN that would end up being the sole and very slender thread that might just help them retain power.

However, that’s exactly how things have turned out after an extraordinary drop in public support for the government saw the August 21 Federal Election result in a hung parliament with the Labor and Coalition parties tied on 73 seats each and needing to win support from four independents MPs, three of whom are from rural constituencies, to secure a working majority.

There are numerous reasons for the collapse in support for the Labor government in the electorate over the last six months but one of the biggest criticisms levelled at the government has been that it lacked political courage on taking on major decisions and that it had no core convictions around which it formulated policies.

This was most obviously illustrated by the dumping of its planned Emissions Trading Scheme in April – causing fury among environmentally focused voters – that triggered the collapse in support for former Prime Minister Kevin Rudd that ultimately saw him replaced by Julia Gillard in June.

How ironic then that the government’s sole piece of genuinely visionary and bold politics – the creation of a $43 billion NBN offering FTTH connections to 93% of the country’s homes – might actually prove to be the single policy that allows it to fight a second-term, albeit as a minority government.

The cliff-hanger changes it all
So, how did the NBN suddenly become the central issue in a country where telecommunications policy has never before appeared even remotely on the main agenda of either major party at election time?

There are several reasons for this, firstly the “rush to the middle” of the Labor Party and the opposition Coalition parties left very few substantial policy differences between the two parties on the key issues such as the economy, immigration and education.

As a result, the rollout of the NBN was one of the very few policy areas where clear water existed between the parties and therefore attracted far more media interest than any telecommunications issue had ever before received in a Federal Election campaign.

Then, of course, there was the result of the election itself which means that both major parties need to somehow persuade the three independent MP’s from regional areas – Tony Windsor from New England, New South Wales, Rob Oakeshott from Lyne, New South Wales and Bob Katter from Kennedy, Queensland – to help them form a majority.

All three independent MP’s have long been huge critics of the existing telecommunications infrastructure in their electorates and rural Australia in general, claiming that the privatisation of Telstra had been disastrous for rural areas and that the quality of rural telecommunications has plummeted since the company’s privatisation forced it to focus on profits rather than quality of service.

As a result all three independent MP’s have been enthusiastic backers of the NBN project with the maverick Katter, although socially conservative, viscerally opposed to allowing the ‘privatisation’ of rural telecommunications services to continue.

Abbott left in a nasty wedge
All of which leaves Coalition leader Tony Abbott in a parlous position given that he ran much of his campaign pledging to “end Labor’s waste and debt” and scoffed at the creation of the NBN.

During the campaign Abbott not only doubted the government’s ability to successfully rollout the network but also describing the NBN a “white elephant” project that would be super-ceded by superior wireless technologies.

In its place Abbott proposed an $6 billion broadband plan that proposed a government built fiber-optic trunk network to service metropolitan areas, allowing private telcos to build their own last-mile FTTH/B connections, and also proposed using wireless broadband to service regional and rural areas.

The Coalition plan was immediately denounced as a complete turkey by many local industry analysts who pointed out that the Coalition plan did not address the crucial problem of last-mile fixed-line access because it left Telstra in place as a monopoly network operator.

Moreover, the Coalition plan also did not provide details on what spectrum would be used for the planned mobile broadband services, what technology the services would be provided by and how many transmission towers would need to be built out – and by who – to facilitate the rural mobile broadband service.

Abbott himself hardly helped matters by putting together a cringe-worthy performance on the influential 7.30 Report on prime-time ABC TV where he struggled to explain the technical details of the Coalition plan – with interviewer Kerry O’Brien even at one stage having to explain the concept of peak download speeds – with Abbott eventually pleading, “I am no Bill Gates. I don’t claim to be any kind of tech-head.”

However, now that there are three rural independents to be wooed Abbott has had to suddenly to re-address the issue and concede that he would be willing to negotiate with the independents on the issue of rural broadband.

It’s either the whole pie or none at all
The problem for Abbott, though, is that having so vigorously attacked the NBN as a huge waste of tax-payers money and even – mind-bogglingly – claimed that FTTH would soon be an “outdated technology” he will find it extremely difficult to reach a compromise deal with the three independent MP’s.

The key attraction of the NBN, and one which helped Labor retain several regional seats like the traditional bell-weather Eden-Monaro, New South Wales, is that it is the first piece of genuine national infrastructure that does not short-change regional areas.

The NBN will offer the same 100Mbps connectivity to the city-slicker in Bondi Beach, Sydney or Toorak, Melbourne that it does to the small farming towns in New South Wales and Queensland that are represented by the three independent MP’s.

As a result, it is hard to envisage how the Coalition can offer anything short of the full NBN that will keep these independents happy not least because the NBN – no matter what its flaws may be – represents a concrete plan and commitment to proving rural markets with high-speed broadband.

By comparison, the Coalition plan is really no more than a vague list of policy preferences which leaves much of the heavy lifting to private players who have little commercial interest in providing rural telecommunications services and it is hard to see how the Coalition can put together a serious plan in the weeks before the new government will be formed.

Moreover, although Oakeshott and Windsor have made public comments about potentially working on a new NBN plan that incorporated a greater wireless segment in order to lower the overall cost of rollout to rural areas both MP’s would be aware that diluting the NBN in such a way would be hugely dangerous from a political perspective.

This is because a publicly-funded network such as the NBN simply has to do all that it can to provide equal access to households, rural and regional voters will simply not accept funding a network that provides high-quality FTTH connections to urban areas – already served by HFC/DSL – and provides them with wireless broadband services offering variable quality.

As a result, the three independents – although serving notionally conservative electorates – will find it incredibly difficult to return home with a deal that dilutes the NBN with a significantly increased portion of wireless connectivity because rural voters have already been promised FTTH connectivity and they will not be happy if this is replaced by a wireless offering that remains more theoretic than actual.