Tuesday, September 29, 2009

So what do you do once you know your phone turns sideways

The "user interface" could be a really cool name for a blog. (Quickly checks if there is one....and finds there is). Unfortunately they use it all too seriously!!

After all the user interface is far more than just the screen or keyboard or pointing or pulling devices in computer land. Everything we interact with has a user interface - the fit of the steering wheel in your hands, the balance of your favourite knife, the dimensions of your favourite chopping board, the height of the kitchen bench....(hmm three out of four are cooking references ...?).

Apple has developed a reputation as the "ants pants" in user interface design. The reality of course is that the original WIMP interface (aka GUI) was developed at Xerox and lifted by Apple. After that Apple made the "break through" of the pin wheel on the iPod and have followed that up with the features of the iPhone - notably the orientation sensitive display and the touch screen feature that detects motion as well as pointing (which is just an extension of the pin wheel).

It does make you wonder why Apple has had three hits? There have been other innovations - heck the touch screen itself has been around a long time but never made it on consumer devices. Perhaps, and I haven't researched this, they just bought it all three times. Perhaps it is the only bit of marketing genius that Steve Jobs has. Or perhaps it is just the bandwagon effect - because its Apple its good. The pinwheel on the same MP3 player from any other brand would not have had the same cache?

All this, of course, is just a lead in to blog the greatest line on an iPhone yet:

An iPhone is like a penis. It's fun to play with when you're on your own but it's rude to take it out at the dinner table. Tom Gleeson on GNW last night.

Monday, September 28, 2009

More on Telstra shareholders

I've already written about some of the commentary about the Telco reform Bill. Phil Burgess has kindly told the ABC his views as well.

He seems to be the source of the claim about Telstra giving up its rights to legally privileged advice. He said;

Just to give you one little example, because I've read the 137 pages, I've read the 200 pages. Not one of these fund managers by the way, yes they had read either the legislation or the Memorandum of Explanation. But buried away in there are all kinds of things. I mean for example, one of the nasties in there is that Telstra, if they don't comply exactly the way the Government wants things to happen, then they will lose the right to get privileged counsel from their lawyers. So the lawyer private client privilege goes out the window.

I'm trying to actually find that. I think it is only a conclusion that emerges from one construction of how functional separation may operate.

Burgess went on with the fear mongering;

When the word gets out around the globe that this Government is essentially expropriating the property of Telstra shareholders, I don't think it's going to bode well. You know we have one Hugo Chavez in the southern hemisphere is one too many. We don't need another one.

It was truly delightful that Crikey pointed out that Venezuela is actually in the Northern hemisphere.

What is truth ... and other Telstra history tales

Kevin Morgan is a former union research officer who is probably better placed than many to tell the full tales of what went on in the last two decades of telco policy, especially in periods under Labour party rule.

However, when he goes out to write an article that starts "In a war the first casualty is truth" as he did in The Age then he better be prepared for close scrutiny.

Firstly he has a go at the suggestion that the current telco Bill corrects past mistakes. I share with him the view that it is an error to blame the industry structure on Kim Beazley for merging OTC with Telecom Australia. I agre that it was long standing ALP policy, but I do not think he is correct in claiming that the legislation to bring about the merger expired with the dismissal in 1975.

The proposal to merge OTC with Telecom was part of the outcome of the Vernon inquiry though the Commissioners could not agree upon it. Following the tabling of the report a sub-committee of cabinet was formed to implement the report and that sub-committee was tasked to include the merger of OTC into Telecom Australia (see the National Archives of Australia " Australian Post Office Commission of Inquiry - establishment of postal and telecommunications authorities - Decision 2237, 2293, 2398(EC) and 2422" Series number A5915 Control symbol 1066 Contents date range 28 Jun 1974 - 5 Aug 1974).

My recollection is that the cabinet decision following on from that sub-committee was to no longer pursue the OTC merger, and I think Kevin errs in believing that legislation was ever introduced. But I need to do more research.

As to the substantive effects, Kevin is right to indicate that OTC was in reality more of a bloated monopoly than Telstra, but also that its revenues were more open to attack from competitors. The basis for the Government decision was the expectation that global trend to competition in telecommunications would see the large firms competing in other countries. The merger was designed to better protect AOTC (as it was originally) from these global competitors, and to position it to globally compete. In reality neither occurred. While initial forays came from Cable and Wireless, BT, and threre RBOCs of Bell South in Optus) and Ameritech and Bell Atlantic (in Pacific Star with Telecom New Zealand) the outcome was that all retired. At the same time Telstra made a number of forays in India and other places, but once again none was successful.

The strategic lesson is that a firm whose core ability is to leverage its access network makes a poor entrant into another market.

Kevin seriously errs in his analysis of the Pay TV decisions. There was as far as I am aware no political pressure whatsoever brought to bear on Telstra to do a deal with News Corporation. Mark Westfield's The Gatekeepers is the best published account. Technically as John de Ridder has pointed out Telsra announced an investment in HFC before Optus did, but the decision that this was a Telstra/News JV came after it.

The pressure to do the deal came internally from Harvey Parker (in charge of consumer) and me (as Account Director for the media portfolio). Options to provide the cable on an open access basis were doomed to failure against plans from both Australis and Optus Vision. There was a group in headquarters determined to do a deal with a US cable company. However, history will show from the success of Foxtel, that if your strategy was to defend Telstra - this was indeed the deal to do.

There is a footnote to that deal that does require explanation - which is why wasn't the Foxtel deal, and Telstra's pursuit of Optus up and down streets like a kid following an ice cream truck "anti-competitive conduct" Optus thought so and sued Telstra for $900M (as noted in both companies annual reports in the late 90s) but the matter was settled for - in the words of Bill Scales to a Senate Committee "a pittance". The prospective member for Bradfield, Paul Fletcher, settled that - at I believe the Sheraton on the Park in Sydney - but the matter is officially confidential.

In an e-mail on 10 July this year, following comments he made at an AFR seminar,Allan Fels stated;

Regarding the merger of Foxtel and all of that, the story is much the same as I mentioned. At the time, in conventional Trade Practices Act terms there was simply not a case to be made against Telstra becoming involved with Foxtel because Optus was already in the field as a powerful looking competitor and it seemed to have a stronger offering and certainly at least an equal offering to what Foxtel and Australis Media had. In addition, as you will recall, Australis Media was an independent party.

The suggestion that Telstra "underwrote" News to the tune of $2B is an accurate representation of the Finances upfront. However, it needs to be considered against the observations made by Frank Blount (in Managing in Australia) that the Pay TV investment was value destroying, but not making it was more value destroying (I think $2B and $6B but I need to look it up).

The reality of why Paul Keating declined the suggestion made to him that there be geographic Pay TV monopolies was (a) the evidence being provided that competition could occur and was occurring and (b) the fact that the person asking was Kerry Packer.

Now Kevin finally suggests that nowhere in the material released by the Government is there a suggestion that Telstra (other than Pay TV) has a stranglehold "compared with other international telecommunications operators". This is like saying that no one has provided evidence that Jack the Ripper was evil "compared to other mass murderers".

Kevin, however, is at least the only person to really nail his colours to the mast. The rest of the defenders of the current arrangements state that there is no need for further reform to deliver competition. Kevin states;

Finally, it's an act of faith that a competitive bounty will be unleashed by destroying Telstra. We've heard it all before that competition will lead to lower prices and better service. Beazley promised it in 1991 and former communications minister Richard Alston said the same with full liberalisation in 1997.

What happened is Australia's performance has gone backward. It's the only fact in the Government's case that stands up to scrutiny. Why would more intrusive and destructive regulation now yield benefits that couldn't be unlocked before? Perhaps it might just be that it is the very construct of competition that is flawed, not its execution.

And that, surprisingly, is a view I have some support for. The question that has ultimately bedevilled telco policy is wheher there truly is a benefit from competition. The standard proof point offered is the continually declining prices. There are three possible responses to that;
1. The price declines also include responses to technology development, and no study has been done to apportion between the technology effect and the competition effect (a position I plan to rectify)
2. The decline in prices has in many areas been mandated by the regulator setting wholesale prices for the monopoly network - couldn't the same outcome be reached by a regulator setting retail prices for a monopolist.
3. The repeated claim that low prices are not reflecting required investment returns and hence resulting in under-investment.

Telco policy is far more vexed than any of the individual propositions advanced by protagonists allows for.

Note: If I find time I will provide more links in this item. I'm sure there was a later cabinet decision that reflected the outcome of the working party established by the decision above - but for the life of me I can't find it now.

Friday, September 25, 2009

And in wireless ...

While we are all talking about the NBN a small explosion is continuing in the mobile broadband space. The growth in data consumption continues to be exponential requiring a focus on 4G networks.

The company I work for, Unwired, has announced a 4G network for Perth called VIVIDWIRELESS. This is a 4G network using WiMAX.

There is a great industry in trying to create a contest betwen WiMAX and LTE in the kind of standards battle as we saw between CDMA and GSM in defining the 3G standards, or even between BetaMax and VHS for VCRs. Increasingly this division is seen as a false idea or a battle that isn't a battle.

That's probably good for the 3G operators who are choking under the weight of the data, but have neither spectrum nor a technology to follow a 4G/LTE route right now.

There is however interesting development with 3G/WiMAX chips in development. It will just b a matter of whether the 3G operators can figure out how to embrace the opportunity before their networks choke.

Telstra, shareholders and public policy

Following the Government's release of its planned legislation trumpeted as Historic Regulatory Reform there has been a degree of kerfuffle in public about the policy.

The twin elements of this have been an accusation that this is some kind of general attack on capitalism or on Telstra shareholders in particular. The latter has a substrand to it that the Government engage in a form of insider trading by getting the Future Fund to offload a third of its Telstra shareholding.

The crazieness started when Phil Burgess was interviewed in the OZ, which he followed up with an opinion piece in the AFR. In this part of his mission seemed to be to paint the new management as failures saying;

The board is getting what it asked for. If you announce in advance that you are not going to stand up for your rights and your shareholders rights, bad things are going to happen and they have. It's the law of the jungle and if you act like prey, you will be preyed upon.

That this incorrectly portrays both the position of the Board and what the range of options for Telstra are and have been, but more of that later.

This then got a crowd of Telstra's institutional shareholders incensed, as also reported in the Oz. One of their number, using words very familiar when coming from the mouths of Burgess and Trujillo said;

I think the minister has made his position very clear that the government wants to rape and pillage Telstra. That means we have to convince the board that it should not be co-operating fully with the government to allow that to happen.

He was backed up by Burgess saying;

Sol has been gone six months and the new make-nice board and speak-softly, softly management hasn't worked. As Donald McGauchie said, 10 years of appeasement of the government led to a very bad result for Telstra. That's why we had to change and turn it into a real company with world-leading results..

Some of the more radical commentary seemed to suggest that the Government's action here would make Australia a country investors would avoid for fear of arbitrary decisions that would destroy value.

All of this is complete rubbish. Firstly, the Government has been determined to bring about structural reform in the industry since they announced their broadband policy. Both Minister Conroy and Finance Minister (and former comms shadow) Tanner had formed the view that structural reform was as important as was broadband.

Their initial hope was the the offer of a $4.7B investment would have been enough to induce Telstra to come up with a strategy to achieve that outcome. For a number of reasons - most notably the Telstra management's insistence that separation not be a requirement - this didn't come about. So the Government with NBN 2.0 has come up with a different plan.

Nothing in the regulatory package introduced requires Telstra to do anything more than has already happened to two other fully privatised former Government owned Telcos - Telstra's equivalents in the UK and NZ; that is functional separation.

The legislation makes explicit a view that Telstra should not be able to further grow its mobiles business while enjoying the market power it does today. This is also a very standard piece of global telco regulatory practice, it is not an interference at all with the rights of the company or shareholders.

Finally the option for Telstra to structurally separate requires only an undertaking that can be completed by 2018. That means it can be achieved as outlined in the explanatory memorandum by cutting its copper customers over to the NBN infrastructure as it is built. Why would a company not welcome the opportunity to utlise someone else's investment to service customers when their own asset is nearing replacement?

There is a process whereby Telstra can meet the Government's requirements without ever transferring a single asset to NBNCo. That strategy means that funds Telstra planned to reinvest in access network can be returned to shareholders in increased dividends, or spect on an international growth strategy.

Finally Lindsay Tanner in The National Times has explained that there was no conspiracy between the Future Fund and Government. He rightly points out that the stock has recovered its losses since the announcement. The surprising thing really is that the stock took the dive because any telco watcher should have known the Government was intent on that route. More importantly is Tanner's view that "It is foolish to assume that the Government’s telecommunications reforms are bad for Telstra shareholders".

What has been the most extraordinary part of all thoughh hasbeen the sub-txt that Government should not make decisions that could erode shareholder value. That would mean that no Government should legislate to improve OH&S standards, no Government should legislate on competition law, no Government should legislate on environmental standards. While there are certainly some whho would hold those views, I don't think they are by any mean mainstream.

In a battle between good public policy for 2 million voters, nd the shareholer interest of 1.5 M Telstra shareholders, public interest should and will win.

Wednesday, September 23, 2009

Capitalism vs Corporatism

I'm not sure about Michael Moore still. I think that he is a left-wing carictature - he's what the left craves in a prophet but he's not really it. A bit like our own chaser boys he's made fun of security guards at front counters, or store clerks - or even the frail and bewilldered Charlton Heston. At least that was the case in Bowling for Columbine which was otherwise a great movie.

I gave his 9/11 movie a big miss because the blurb suggested it was one of those "the US had it coming" types. I inhabit a strange world in which I can accept that revolution and terorism may be justified political expressions (though I'm reading Blood & Rage now which might change my mind), but even in that mode I can't figure out the 9/11 attack as any kind of justifiable attack.

Adrianna Huffington tells us that Obama and You must see Moore's new film Capitalism: A Love Story.

Having told us to see the film, and that in it Moore is replaying all the stories in Huffington's own head, she tells us though she doesn't agree with the film;

In the film, Michael describes capitalism as evil. I disagree. I don't think capitalism is evil. I think what we have right now is not capitalism.

In capitalism as envisioned by its leading lights, including Adam Smith and Alfred Marshall, you need a moral foundation in order for free markets to work. And when a company fails, it fails. It doesn't get bailed out using trillions of dollars of taxpayer money. What we have right now is Corporatism. It's welfare for the rich. It's the government picking winners and losers. It's Wall Street having their taxpayer-funded cake and eating it too. It's socialized losses and privatized gains.

There is a lot to unpack in that - not least of which is that neither Smith nor Marshall were necessarily "envisioning" anything as opposed to merely describing how markets in fact work.

This raises an interesting definitional exercise - what is "capitalism". Some would say a market economy as opposed to a command economy. However, as anyone who has read about command economies knows markets still exist - often "black" but nonetheless real, and occupying as many areas of exchange as they can.

The Marxist definition of capitalism rests on the concept of the "private ownership of the means of production, distribution and exchange". In their "communal" idyll this ownership is vested in the workers - though possibly expressed in the form of their ciollective ownership throgh Government. (The battle of control between the local collective and the central authority was an interesting part of the Russian power struggles of the twenties).

The more economic version is recognising that an essential feature of capitalism is the accumulation of capital, that is the retention of surplus for reinvestment. This feature necessitates the existence ultimately of the common stock firm, including the conversion of partnerships to listed firms (part of what brought the investment banks undone). That is, absent some other rule - and ethics is not enough - corporatism is the natural extension of capitalism.


Gerard picks it

Writing in his Media Watch Dog last week Gerard Henderson fingered The Age's Catherine Deveny for only recycling four topics; God is dead, marriage is out of date, private schools suck and "it's week four write about the family".

She obviously doesn't read Gerard - if she did she might have tried to break the mould and write about something different. What's worse her stuff now gets published in The National Times.

This time it is a supposedly witty diatribe about the agony of taking one's children to the show, and how she started with instructions about their healthy eating but "by 10.30am, we'd scoffed toffee apples, fairy floss and coloured popcorn, and we were on to the battered hot dogs on sticks."

She manages to try to make fun of her apparent ineptitude as a parent and a complete lack of understanding of the cultural significance of our great agricultural shows. As a parent I loved taking my kids to the show every year (in Sydney) and we never had expense blow outs (literally one ride, two show bags - an apple purchased at the fruit and veg displays etc).

Meanwhile we talked a lot about the challenges of farming, the significance of many of the skills on display.

I'm with Gerard - we don't need this kind of rubbish writing - certainly not under the masthead of The National Times (not sure about The Age - it is a Melbourne paper and hence has always been a little suss).

Great to see ...mathematics pull a crowd

As a fan of mathematics (while first degree qualified I really can't claim to be a "mathematician")it was great to see a blog post about a "sell-oout" crowd for a maths lecture.

The article contains a link to the Mathematics in Australia blog - an interesting read.

Monday, September 21, 2009

New Democrats ... Old Democrats

Great story in Crikey today (but that's the e-mal version) that recounts the battle going on inside the Democrats between a "Christian Centrist" takeover from South Australia, battling what they perceive to be still blaming "the gays" for the party's demise.

There were a very sizeable number of people who wanted to put the Democrats down (like a racehorse) after it lost its final Senate positions. Their theory was that to try to continue would only further traduce the memory of a party that did have some significant achievements and influence.

To those who still want to coalesce around a "progressive" banner without feeling the need to bed down with the machine driven union dominated beast that is Labor, or to sell their sould to a single issue party like the Greens (and be a fellow traveller with unreconstructed Trots) it is perhaps time you did what the Australia Party and Liberal Reform Movement did all those years ago. That is find yourself a saviour, someone with a sufficiently high profile (and ego to match) to relaunch progressive politics.

Unfortunately, no names spring to mind. Brendan Nelso might almost get there if it weren't for the fact that his final incarnation (to win the leadership) was as an arch-conservative. It needs to be someone who acknowledges climate change, up to date with same sex relationship rights, who is otherwise highly liberal in the role of the State. Peter Costello with a smirk transplant is one option, but only if desperate.

Tuesday, September 15, 2009

A small win

Earlier this year I pointed out in a Senate committee submission for Unwired that a legislative provision to require an instrument be "published on the Internet" was nonsense.

I'm pleased to note that the latest piece of legislation from the same Department uses the term "published on the Department's website".

I'd like to believe it is my own little victory!

Monday, September 14, 2009

On models (following Krugman)

I already commented on the contribution of Paul Krugman on the GFC. There has been a flurry of activity since.

Our own Alan Kohler has contributed the view that economists just need to catch-up on the bit they missed, namely the behaviour of real people, writing;

The collapse of Lehman was neither the end of capitalism nor the end of economics; the capitalists have bounced back and it’s imperative that economists do the same and come up with a new theory that accepts that economies are run by flawed humans and that they are buffeted by a financial system that is subject to the madness of crowds. .

A different take was in a later article in The New York Times. In this a reseracher from the Santa Fe Institute (home of complexity theory of all kinds) was quoted as saying;

You don’t need a model of human psychology to see that there was a danger of impending disaster. But economists have failed to make models that accurately model such phenomena and adequately address their couplings.

So this is the theory that we can get it right if we just build in more terms to our model. (For the technically minded the failure in the modelling was an assumption that derivatives were spreading risk rather than compounding it. The theory worked so long as the risk in the underlying assets weren't correlated. In fact, the risks were correlated in the event of an overall slump in the housing market. The housing market could experience an overall slump because the terms of credit kept getting relaxed because the new markets in derivatives seemed to be diversifying risk. Hence, not only was the assumption about correlation wrong, the assumption about correlation was a contributing factor to it being wrong).

Also Glenn Dyer writing in Crikey noted a Professor Figlewski saying it was about not measuring the right kind of risk.

What wasn’t recognised was the importance of a different species of risk -- liquidity risk. When trust in counterparties is lost, and markets freeze up so there are no prices, really showed how different the real world was from our models.

And finally we had also in Crikey Steve Keen returns to explaining why it is still hard being a bear - his theme being that underlying all the rest is a failure of the maro-econmomic models to allow for total debt and that even if we recover through short term stimulus the underlying problem (tumour as he calls it in his analogy) is still there.

So what should we conclude? I think there is an awful lot here to note. The first is that simply adding more variables to the overall equations won't permanently solve the problem - because we are still likely to leave something out. More specifically the overall economic structure is so complex that it can't really be perfectly modelled. Our imperfect models will, however, give us an illusion of control and encourage us to pursue some extreme strategy till we have an encounter with the next flaw. This suggests a policy like the Roman one of eveything in moderation - regulatory systems should be designed to always dampen excesses.

The second is that at the very least the theory space is contended and policy makers should seek out the implications of a wide variety of advisers, not merely the established school.

Finally, thre is the position Eva Cox outlined in Crikey today - which was really in response to the Howard-Rudd stoush. She notes;

Neo-liberalism, or neo classical economics, assumes that human nature is predictable as individuals act rationally on the basis of self interest. Equations therefore can predict and explain our choices and there is no need to explore more complex bases for human behaviours such as relationships, optimism, irrational exuberance and idiocy.

These are excluded as tastes as are the pressures and pleasures of belonging to family, society, community or other groupings. Market theory is problematic to politicians because it is value free and creates winners and losers as power and resources are unevenly distributed.

This is not totally correct as an assessment of all approaches to economics - but it certainly is of the orthodox school of markets. There is an interesting conundrum in fact faced by market theorists that they cannot admit of "free will" as the perfectly rational decision making individual never has a "choice" to make, they follow a course of action determined by an array of factors around them but ultimately when faced by alternatives can only follow the one course that represents maximising their utility.

But the twin elements Cox describes are the focus of the school of behavioural economics (the psychology of decision making) and institutional economics (the behavioural rules and norms of a social grouping).

Cox goes on;

I am not arguing against markets, where appropriate, but against the ideological assumption that competition and markets are always preferable. This is what needs urgent reviewing to create more equity, efficacy and therefore efficiency.

The concession to markets begs the question of determining when they are appropriate. One of the outstanding errors in the reasoning of the orthodox is that markets are to be preferred because they are "efficient" which is deemed to be measured by the condition of a Pareto optimum. That condition is that no person can be made better off without making one person worse off. The matching concept is a Pareto improvement in which at least one person can be made better off without making one person worse off. But this also gets fudged, to the concept of a potential Pareto improvement, wherein at least one person can be made better off and could compensate those made worse off. A lot of policy is pursued to achieve potential Pareto improvements without compensation - and indeed the same market theorists argue that such compensation blunts the incentives of both the winners (the rewards are less) and losers ("rewards" for doing nothing).

Economics can do a lot better than it currently is, but should never be relied upon as the sole definitive tool for policy analysis.

How not to launch a web news service

This morning Fairfax launched its new National Times online content - fairly rapidly conceived I think and probably a response to News Ltd's The Punch.

I really only realised that today was the launch day because Breakfast PoliticsM linked to a few stories from it. While I scanned the stories by K Rudd and M Turnbull, I closed them before I thought I'd have a look at the whole site.

So I googled "National Times" - interestingly the first items listed were all about the relaunch but not to the service. Even more strangely there wasn't even a sponsored ad link to it.

The online story on one Fairfax online site included the URL, but not as a hyperlink. There was one small ad on the SMH home page, but over the fold - and it linked to a static ad.

Anyhow, I finally found my way to the site. Not very impressed really with day one! Most importantly it doesn't look at all like a relaunched masthead - it is an amalgam of the content of The Age, The SMH and the two online services WAtoday and brisbanetimes. If I were Fairfax journalists I'd see this as the first sign that the move is definitely on to convert the existing two broadsheets to one national newspaper.

I'm not impressed so far with The Punch either. Though there is an interesting minor distinction - The Punch has a set of links headed "Opinion from Everywhere" that includes as its first link today the PMs contribution to The National Times. Meanwhile The National Times equivalent is labelled "Global Opinion".

I have to say I'm also disappointedthat The National Times gives you the opportunity to sign up for a daily newsletter but to do so you have to become a "Fairfax Digital" member. So terribly old school. The Punch has a similar service that asks for the e-mail address first then draws the user through the rest of the registration process - much more user friendly.

I wonder who will join me in relaunching the masthead of Nation Review online?

Friday, September 11, 2009

Writing history

What is the reason for the apparent Australian economic miracle?

Kevin Rudd has received plenty of criticism for his speech launching Paul Kelly's new book. His apparent crime is to claim all the credit for his own side of politics, both the Hawke-Keating reforms and his own stimulus.

Unsurprisngly John Howard has come out in the Oz and claimed that Rudd should come clean and realise it was the combined effort of his own term as Treasurer, then Hawke-Keating, and then his own reforms. In what mighht be a preview of his memoirs (now at 260,000 words I'm told) Howard claims there were five big reforms required from the early 1980s "financial deregulation, fundamental taxation reform, dismantling of high tariff protection, privatisation of government-owned commercial bodies and a freer labour market".

He catalogues how each was achieved, including his own inquiry to start the financial dregulation piece.

I have previously opined that the record dates back to the Whitlam Government. The choice by Howard of the five themes actually provides some support for that view, at least on two fronts. These are the 25% acoss the Board tariff cut and the move that split the PMG into Australia Post and Telecom Australia. This was really a far bigger step of corporatisation than we perhaps realised at the time.

I'm prepared to give the Fraser government more credit than Crikey did today, while it didn't act it enquired. It created the intellectual framework in which the discussions of the 80s could occur - and outside of the finance enquiry the notable achievement was the Davidson enquiry.

However, as noted by Rudd, the one thing Howard never got was competition policy. That was the one great reform of 1974 and 1995 that Howard did nothing to progress, and indeed as a Minister in the Fraser Government did a fair bit to damage.

However, the most extraordinary part is Howard claiming Rudd is belittling himself by his attempt to tell thehistory his way. I don't recall Howard being anywhere near as gracious to the Hawke-Keating economic legacy within two years of his first election, or, indeed for that matter, any point up to his own defeat in 2007.

Thursday, September 10, 2009


The history, role and function of the ABC is an interesting area of study. All the elements are ultimately as contended as any in the history or cluture "wars". The first distinction is whether the ABC exists as a piece of social welfare designed to ensure national availability of news and radio, a feature that one could argue is no longer required given the coverage of commercial outlets. A second distinction is whether it is designed to be some kind of higher form of broadcasting than that supported by mere popularity versus the idea that it too should be judged by its popularity. A final distinction is whether its role is to be a totally dispassionate broadcaster "of record" or whether a slightly pinkish hue is warranted to balance the interests of the owners of commercial media.

Alongside these contentions are questions of governance and ongoing questions of exactly what control the Board should, or does, have. At the same time it has always had an unhappy relationship with the commercial news organisations. When it first commenced the ABC was providing its news service by basically reading from newspapers, and then from the wire services (AAP) that supported the news. It was only in response to the denial of access to these services that the ABC started to build its own, now much vaunted, international news gathering network.

Now the battle is on again, with James Murdoch criticising the "chilling" growth of the BBC into new services and stiffling the opportunity of commercial operators. Reportedly ABC CEO Mark Scott is preparing to rebut Murdoch's claim.

Meanwhile however the ABC seems quite intent on pursuing aggressively their digital media strategy, seeking open access to the NBN, expanding their relationship with ISPs to deliver iView and reports that they have recruited Annabel Crabb for their digital channels.

Personally I am sure I want my ABC to be available in these channels, but am concerned about the idea that we need to rely on the Government owned media for "investigative reporting".

So at this stage I'm merely troubled and perplexed.

Monday, September 07, 2009

Nowwearetalking to close

I'll quote the e-mail in full;

Dear Subscriber,

Since we established nowwearetalking almost four years ago, much has changed in the online landscape. In Telstra's world, it is also a different climate now compared to when the site was launched in December 2005. After a review of where we were headed with our online communications and how best to engage with important stakeholders like you, we have decided to close our nowwearetalking website and develop a new, more engaging, interactive site under the main telstra.com umbrella.

In the process, we will make some changes to the content and the way we interact online with people who have an interest in all things Telstra. Be assured that the new site, which is under development, will provide ample opportunities to engage in genuine online conversations.

The new site will be dedicated to allowing us to talk with you, but more importantly – to listen to your views, opinions and ideas.

In the meantime, we have set up a temporary home where we can receive your comments/input and share our perspectives on the new site moving forward. You are invited to visit www.telstrablogfeedback.com.au and tell us what you think.

Thanks so much for your interest and support over the years.
We look forward to welcoming you to our new website when it goes live in the coming months, and will keep in contact with any news and updates on the way.

Best wishes
The nowwearetalking team

I welcomed the initiative when first launched and actively contributed in the spirit of open discussion. However, when the site did finally become more active it was highly populated by a small number of Telstra "shreekers" complaining about th regulatory regme which hadn't changed fundamentally since before the first float. I started to refer to it as "nowweareshouting" and stopped my engagement when the editor took to writing comments after almost all my posts.

Interesting to note that the new site will be more dedicated to genuine conversation - and listening.

Krugman on Macro

A really good article in the New York Times by Paul Krugman under the title How Did Economists Get It So Wrong?. I particularly love the line, "As I see it, the economics profession went astray because economists, as a group, mistook beauty, clad in impressive-looking mathematics, for truth."

Interestingly co-incides with my starting to wade through Tony Lawson's Economics and Reality which in its openings suggests a similar aspect to the orthodox school - that is, they are so transfixed by the mathematical elegance that they miss the point that they re increasingly describing something other than reality.

This does open up that other wonderful line of enquiry on the relationship between mathematics and science. In my earlier comment I didn't allude to the long history of the association between physics and economics through maths (see More Heat than Light or How Economics became a Mathematical Science). It is interesting to posit that both economics and particle physics have reached dead ends because of the mathematics they are choosing to use and that the path forward will entail a step out to a new sett of explanatory tools.

I believe those tools will be mathematical, though there is an alternative offered by Stephen Wolfram's New Kind of Science. His ideas have not received wide acceptance, though possibly because they are written in such a horrible self-promoting way. But the concept is alluring - that explanations can be sought through assumptins that the basic explanation is in rules not formulae. In economics this would be the ultimate end point of reserach in agent based computational economics. In physics it could just be that the fundamental "particles" could be replaced by "fundamental computations".

But that perhaps is fanciful - and I don't want to distract from Klugman's great work.

Note: My thanks to Richard Farmer in Crikey (behind the paywall) for writing about the article. Perhaps though he could learn to put the whole paragraphs he lifted from the original inside quotation marks.

Friday, September 04, 2009

Three views of the public service

The public service has been a bit in the news of late. Today we saw an interesting contrast between the desire for Kevin Rudd for the "best public service anywhere in the world" including "more prescient and creative policy advice, an emphasis on programs and services that put the citizens first, a continued culture of impartiality and honesty, greater flexibility, and to be effective and efficient in all its operations".

The contrast was the story that John Howard did not want advice from departments on whether to go to war in Iraq, only how.

I had my own experience of this discrepancy. The Department of Broadband Communications and the Digital Economy has a document setting out itsstrategic directions. This includes a section headed Our practices: how we will approach our work which says they will;

* develop and implement effective policies and programs that clearly deliver the policy agendas of our Minister and the Australian Government
* set out our key strategies, priorities and performance measures for each financial year in the Portfolio Budget Statements
* adhere to our Service Charter standards and the Australian Public Service Values and Code of Conduct
* uphold good governance and public accountability practices
* align our planning, performance management and reporting to support Government policy
* encourage consumer and industry representation in policy development to stimulate innovation and improve outcomes
* nurture our relationships with key stakeholders
* continually review our processes to ensure that they support, and not hold back, the delivery of outcomes
* ensure that our people are working in a safe and healthy environment
*provide our people with support to perform and opportunities to develop their capability and build a career within the Department, and
* improve internal and external communication.

I was briefly working at the Department at the time this was finalised and suggested that perhaps the first item should be "ensure the Minister is appraised of the economic, social and technical developments that may require policy responses." I was not privy to any discussion of the suggestion. However it would appear that that is exactly what the Prime Minister expects.

Anyhow the Department has a new Secretary and this is where we find our third view. The new Secretary has been attacked by Senator Minchin over the course of electronic conveyancing. His first is somehow the idea that Harris might be "hopelessly conflicted" which is something I do not understand. Paid wage labourers regularly take on tasks at variance from their previous tas, most notably moving between firms. There is a real difficulty with politicians like Minchin have only served "the party" in its aministration or in parliament.

The second is that Harris's record of delivery might suggest he is the wrong person. this ignores the fact that th Secretary his Government imposed had an equally poor record with the Access Card, and the fact that NBN delivery will rest with the NBN Board and CEO not the Departmental Secretary. The latter being a perfectly good example of how to separate policy advice from program delivery - on which more another day.