Why a high speed broadband network is crucial for Australia

Australia needs to join the high speed internet revolution

Australia needs to join the high speed broadband revolution

As usual, the current Australian government has done a poor job at explaining the benefits of one of their major initiatives and as a consequence it is being largely ignored and risks being totally abandoned if they lose power. I’m talking about the National Broadband Network.

Unfortunately, the cost of the Australian government’s planned $43 billion National Broadband Network has become the issue rather than the benefits of high speed broadband for the country. The Opposition has focused on the cost, perhaps with good reason, and claim that the project is a White Elephant, yet they haven’t offered any viable alternatives.

Meanwhile the Government has failed to sell the real benefits of the NBN to the public and potentially negate the argument against.

I’m no infrastructure expert and I don’t pretend to know the best way to deliver high speed broadband to the nation but I do believe we as a country must have a high speed broadband network as soon as possible.

Australia has been fortunate to become a rich nation due to natural resources. The country initially grew rich off the sheep’s back and more recently has smugly cruised along due to a prolonged resources boom.

But this won’t last forever and we should be doing much more to invest in becoming a smart country that benefits from ideas rather than mineral resources. In fact, I suggest that if the Government proposed to invest the takings from a mining tax and invested it directly into infrastructure such as the NBN then very few could argue with the logic of using our mineral wealth to build our future prosperity.

A comprehensive high speed broadband network will benefit Australia in so many ways. Here are just a few I can identify:

1. Increased cross-border trade in IT services and what is called IT-enabled services (ITES). Some estimates for the IT services and ITES market put it between $US475 billion and $US700-800 billion. However, it was suggested that in 2007 less than 15 per cent of that market was being tapped, indicating a significant potential for growth. Emerging economies such as India, China, Costa Rica and the Philippines are tapping into this market while Australia is left behind. In 1995 India’s software exports jumped from $US1 billion to hit $US32 billion in 2007 and the industry now employs 1.6 million people. (source: World Bank).

2. Energy, transport and emissions reductions. As we become a more digitized economy, conducting more and more business online the nature of business and employment changes dramatically. The US city of  Seattle reports a potential saving of up to $US1 billion per year from its investment in a fibre-to-the-node network due to effects in the electricity and transport sectors, along with a reduction in carbon emissions. (source: Seattle.gov) That’s just one city, smaller than our two largest cities.

3. Grow regional centres. The Government has long promoted Regional Centres of Excellence to stop the migration to our crowded capital cities. A high speed broadband network surely is crucial to such a plan. Here in Newcastle we lament the drain of talent down the F3 to Sydney and feel that this city could contribute enormously to the economy with clean-tech and IT industries given the appropriate infrastructure.

4. Economic growth. The Australian Bureau of Statistics report that income derived over the Internet soared by 52 per cent in the 2008-09 financial year to reach $123 billion (up $42 billion) as an additional 25,000 businesses began to received orders over the Internet and the take up of broadband rose. But this is only the tip if the economic iceberg and greater growth is possible because only 27 per cent of all businesses use the Internet to generate business currently.

5. Be internationally competitive. South Korea’s Government has invested $US70 billion into high speed broadband to give the country the world leading coverage. It is now accepted the broadband investments have been key to South Korea’s status as a middle-income nation after years of economic despair. Home-grown online gaming and entertainment have boomed in South Korea as a result.

As outlined in a May 2010 Fibre-to-the-Home Council report on the global ranking of FTTH-connected broadband countries, Korea is on top, the US and China are near the middle and Bulgaria is No.23. Australia doesn’t even make the list.

Finland’s Ministry of Transport and Communications has made 1-megabit broadband Web access a legal right and said it would make a 100Mb broadband connection a legal right by the end of 2015. Here is an example of a once agricultural economy that has steadily transformed itself into a tech economy. Finland has long been a tech-industry leader that has done a fine job investing in technology, more than many of its European counterparts. It’s also home to Nokia, among other tech firms.

Then there’s the benefits for education, medicine, energy and more.

Countries like Finland and South Korea are clearly planning for the future with this strong step into broadband and it’s inevitable that many more countries will follow.

If 100mps is destined to become the norm amongst progressive countries, where will that leave Australia? Irrespective of whether the final result is the proposed National Broadband Network or an alternative scheme, the truth is that Australia needs to address the need for widespread high speed broadband quickly. Its crucial to our future.

Update: An hour after I posted this, the Coalition released their broadband policy and plans. It hasn’t been well received by most commentators and appears to be a patchwork solution at best. Here is political commentator Peter Hartcher’s take on the two plans thus far.

I also came across Malcolm Turnbull’s opinion’s on why he feels the NBN is a white elephant. Some good points in here but does the newly announced Coalition plan really address it sufficiently?

Note: You may also want to read Brendan Brooks blog post The National Broadband Network – it makes sustainable sense

Over to you: I feel its incumbent upon Australia’s digital community to drive the debate on high speed broadband. If you have more examples or information you can share please comment here, and provide links. Hopefully we can compile the best information and use it productively.

Note: tonight I’m attending a forum on the NBN and its benefits for regional centres such as Newcastle. I’ll add to this post if any new information is revealed.

Posted under Digital, Web/Tech

Written by Craig Wilson

11 Responses to “Why a high speed broadband network is crucial for Australia”

@shelleywinsor1 on Twitter says:

@mediahunter check out NZ Vector high speed b’band bid and the campaign @vaughndavis and I created at Y&R. http://www.fibretothedoor.co.nz/

Comment by Craig Wilson on August 10th, 2010

Have a listen to the Background Briefing (ABC Radio National) podcast titled ‘Hanging by a fibre’. That discusses why it is worth having it.

Lots of links, A glossary of terms as well.

Comment by crinau on August 10th, 2010

Doh try that link again….


Have a listen to the Background Briefing (ABC Radio National) podcast titled ‘Hanging by a fibre’. That discusses why it is worth having it.

Lots of links, A glossary of terms as well.

Comment by crinau on August 10th, 2010

Craig, best outline of benefits of NBN I have seen yet. Thank you. I am gobsmacked the government still uses the example of Johnny doing homework and downloading movies as to why we should do this. It is not the technology that disappoints, it is in the vision, understanding and communication of the need for such technology that our politicians on both sides of the house fail yet again.

I also read NBN CEO Mike Quigley’s speech presented at the ACS Charles Todd Memorial Oration, and still you give a better rundown on potential benefits. The arguments I make (when arguing with my own friends over this) are that:
all national infrastructure projects built for future need are expensive – so was putting in the original copper wire (a point made by Quigley);
some of the largest and most controversial public expenditures on record were for projects we now simply couldn’t imagine life without today – the Sydney Opera House and Sydney Harbour Bridge being just two, and both have well exceeded in return the expenditure;
how could anyone have calculated the true cost benefit ratio of any of the aforementioned (copper, bridge, house) at the time, when no one could have imagined the future benefits that both enabled?

More importantly, in an age still reeling from the changes wrought by the Internet, who knows what we could think of next, that could make this pay for itself a thousand times over? The Internet has changed almost every aspect of life, from how we communicate, through how we do business, to what we do for business.

I am of sufficient age to remember the introduction of the fax machine, and what a wonderful thing that was, replacing the telex. I remember the introduction of mobile phones, and thinking as the Motorola rep sat in my office (selling a $4,000 sewing-machine-sized brick and box door-to-door), why on earth would I want a phone with me at all times? I could not conceive of ever needing to be so within reach. Today, I couldn’t conceive of being without my mobile, itself a marvelous morph of telephone, Internet and computer.

Before the Internet, Australia suffered ‘the tyranny of distance’. Internet made the world a much smaller place, bringing a wealth of information, customers and opportunity to our fingertips not previously accessible. Just like the high speed rail link between Sydney and Melbourne – argued for decades in parliament and ultimately never built – the issue of FTTN has already been argued for too many years, and politicized rather than being adopted as an essential bipartisan investment in the country’s future.

The fact is, we don’t know all the benefits that will ensue because it will create new products and services, new businesses and whole new industries we haven’t even dreamed of yet – just like the Internet did. But what we do know is that it will bring enormous benefits to regional Australia in terms of connecting the bush to all that we take for granted, removing that last final barrier of geographic distance and social isolation. It will give life to the regions – enabling access to new markets, higher education, cultural and medical services not currently possible, and not possible on a wireless/mobile solution.

And the flow on social benefits – allowing people to move out of overcrowded cities to places with affordable housing; of removing the three hour commutes each way to a lousy job; traffic and associated air pollution, stress, and use of petrol and so on.

It is also an underground solution rather than a surface solution of mobile towers that like power infrastructure, are subject to the vagaries of weather and bushfire. There are many more smarter people than I who can give a hundred other reasons for FTTN. None of them are sadly in government.

Comment by Alex Harris on September 2nd, 2010

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Comment by Week 5 « Tech cult ed Blog on September 7th, 2010

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Comment by Highspeed Broadband | Yan's teculted Blog on September 16th, 2010

If people understood both the coalition policy and the labor policy properly and had a grasp of what is being talked about you would probably see vast support for the NBN with little to no objections.

Unfortunately both parties don’t seam to get things very well, labor doesn’t know how to prompt the project properly and the coalition just doesn’t understand the technology.

Comment by JAB_au on February 17th, 2011

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Comment by Individual Blog Essay | rock on on January 6th, 2012

I think the NBN will really change the IT ecosystem in Australia, access to high speed fibre broadband will enable oz startups to compete with the mega cloud servers in the states. It will enable localised cheap hosting for small businesses which will really drive online sales and service. http://CairnsNBN.com.au has an overview of the nbn rollout, an explanation of what the nbn is and a price compare table including major ISPs around Australia.

Comment by Alex on July 9th, 2012

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