Industry cold on data-retention grants as analytics steams towards hot 2016

Telecommunications industry observers remain unimpressed by the lack of details in the new government program for helping Australia's telecommunications providers implement the technology required to meet their obligations under new data-retention legislation that took effect last October.

Announced last week by Minister for Infrastructure and Regional Development Warren Truss, the new Data Retention Grants Program (DRGP) will provide the telecommunications industry with up to $128.4 million in funding to support “the upfront costs of meeting their data retention obligations”.

The total cost of compliance with the controversial new legislation – enshrined in the Telecommunications (Interception and Access) Amendment (Data Retention) Act 2015 – has remained a source of consternation for the industry, which faces significant costs in introducing new systems for storing, retrieving, analysing and archiving massive quantities of data.

Announcement of the DRGP comes after years of discussion and apprehension from those concerned not only with the costs of implementing and running the program, but with the need for high-grade security to protect the retained data. A sliding cost estimate, lack of detail from the government and opaque process for determining expected costs had some analysts claiming the government was treating the industry “like mugs”.

Despite the DRGP's funding announcement, telecommunications industry group Internet Australia was among those lashing out at the amount, which CEO Laurie Patton warned would be “well short of the likely total costs as estimated by our ISP members” and in an analysis conducted for the government by PwC, which placed the costs of implementing the scheme at anywhere from $188.8m to $319.1m.

Internet Australia's assessment described the act as “fundamentally flawed” and the organisation has pressured the government to bring forward a 2018 review of the program, which it has warned will drive many ISPs, particularly smaller providers, out of business.

Applications for the DRGP close on 23 February and information sessions – planned for key cities in early February – are likely to see some heated discussions as service providers raise their concerns.

The government, for its part, is likely to argue that the offered amount has fulfilled its obligations, claiming that the program “delivers on the Government's commitment to make a financial contribution” to implementation costs.

“Assisting industry with the implementation of the data retention obligations remains a key priority for the Government,” its information site argues, noting that “Metadata is used in nearly every counter-terrorism, counter-espionage and organised and major crime investigation.”

The growing use of large quantities of data in criminal investigations has paralleled the growing use of analytics technologies for information-security processes, with security-analytics tools rapidly being taken up and heavy investment in the area fulfilling a 2014 Arbor networks prediction that the technology would become mainstream by 2016. This growth is likely to dovetail with investments in data-retention infrastructure, which will see law-enforcement mining the data and even the likes of the Australian Taxation Office, Australian Border Force, Victorian Racing Integrity Commission, and others are lining up to get access to the analytics goldmine.

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