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Managing editor David Donovan says the NBN will transform Australia, making it more prosperous, innovative, competitive, inclusive and more environmentally friendly. He believes the Liberal Party's opposition to the policy could cost them the 2013 election.

From Twitter: Coalition unveils high-speed rail plan.
Coalition unveils high-speed rail plan. "It might not be as fast as Labor's plan, but it's cheaper and will be built sooner," says Tony Abbott. (From Twitter.)

(This story was originally published on 28 June 2011.)

YESTERDAY (28/6/11), Tony Abbott opportunistically used the fact the Federal Police had arrested a hacker as an excuse to talk down the value of the NBN.

Consider Tony Abbott on yesterday’s ABCPM program:

“One of the dangers with the National Broadband Network is that greater centralisation does expose our system more to this kind of problem. Now hacking is always a problem but the more concentrated our systems the more damage any single hacker can do.”

The hacker, David Cecil, aka ‘Evil’, had infiltrated a company – Platform Networks – that was looking to partner the NBN Co in some technical projects in the future. Platform Networks had no access to the NBN servers or technology and there was absolutely no damage to the NBN.

Now, the leader of the Liberals is a self-confessed Luddite – he admitted on the 7.30 Report last year that he is “no Bill Gates” or “tech-head” but – really –– to say that the NBN will “concentrate Australian data” is, at best, idiotic and, at worst, downright deceitful.

What the NBN is doing is, in fact, replacing the ancient copper wires that connect houses to the telephone exchange with modern fibre technology. It offers modern cabling and, therefrom, better data transference — not data storage. If Tony Abbott doesn’t understand that, well, he doesn’t have enough of a grasp of the issues to be prime minister. If he was lying to make a political point...

In any case, I suspect ignorance and technophobia rather than any deliberate deceit. I mean, look at the below video, which shows Tony Abbott stumbling his way through an interview with the ABC's Kerry O’Brien just before the 2010 election. Incredibly, he even admits he had no clear idea what the term “peak speed” means in relation to broadband, let alone the fine detail of the Coalition policy. Jesus wept...

A 2013 federal election prediction

I am going to make a long-range prediction. I reckon that by the time the 2013 Federal election rolls around, it will be the NBN, not the carbon tax that people will be talking about. By then, after the world doesn't end and people realise they are getting fairly compensated for any increases in the cost of living from polluters passing on what they are paying for carbon pollution, the Coalition's scare campaign on this issue will inevitably shrivel and die — just like Labor’s anti-GST campaign collapsed after it came in during the year 2000 and life carried on as per usual. Indeed, the polls are already showing a small turn-around in the Government's fortunes as the electorate gains more information about the proposal. By 2013, I predict, it will be the NBN that will become the battle-ground and – noting what happened in 2010 in Tasmania, where the NBN was trialled and rolled out prior to that election and Labor won every seat – the NBN may not at all be a happy hunting ground for the Coalition. This is what Independents Tony Windsor and Rob Oakeshott are banking on, at any rate.

If Labor do manage to successfully roll out the NBN to a large number of happy regional electorates before 2013, I confidently expect them to win the election due that year. (Of course, "successfully" is a relative term — because even if it is done well you can still expect the Liberal Party’s media wing, News Limited, to attack it in the same way they campaigned effectively against the Building the Education Revolution initiative, even though the BER was ultimately shown by an indendent inquiry to have been delivered efficiently.) This is because the Coalition has promised to abandon the NBN if it is elected. Regional areas awaiting the NBN in 2013 will be looking enviously at other areas who have already received this technology, knowing that if the Liberals are elected they will receive nothing. This should, in itself, be enough to get Labor over the line.

To show Abbott is quite incapable of playing a long game, he has thrown fierce rival Malcolm Turnbull – the former owner of Ozemail and probably one of a handful of members of the Opposition to fully understand the immense future value of the NBN – a hospital pass by making him the Opposition communications spokesperson. The question is: how fiercely will Turnbull campaign on this issue in 2013, knowing that it is of massive future benefit to Australia and is, further from that, aware that if the Coalition loses he is likely to return to the Liberal leadership?

The answer is: he knows he’s on a hiding to nothing by attacking the NBN. Ergo, he will probably play dead-ish on the issue in 2013. That is, he will do enough not to attract any negative personal attention in the election campaign, but he won't put himself entirely on the line. In fact, noting that it was Abbott who made yesterday's Opposition commentary about the alleged hacking, he probably already is playing dead. Notice how he seems to speak much more often to the media in favour of pricing carbon than about the NBN at present?

Why the NBN is vital for Australia

Many people think that the NBN is all about entertainment — having better download speed for movies, games and music.

This is sheer ignorance.

It is the sort of dopey thinking that infers that the way we use something now is the way we will always use it in the future. These sort of assumptions are generally made by people who don’t understand (or perhaps accept) the concept of evolution. As a former systems accountant, business analyst and financial controller (amongst other roles) during the course of my 20-year working career – it is plainly obvious to me that it will be in the business world – especially small business – that the most obvious and significant benefits will accrue from the NBN. Put mildly, the Coalition’s opposition to the NBN is a slap in the face, especially, to their small business support base.

Armidale was the first mainland location to receive the NBN

The reason why the NBN is so vital to Australia is because Australia is huge, yet extremely urbanised.

Australia is one of the world's biggest countries, yet also one in which the greatest percentage of its population resides in metropolitan centres. And this is only getting worse as jobs and the youth drift to the big cities where the most opportunities for advancement exist. Capital cities are becoming more congested, more sprawling, more unhealthy, more unpleasant and more – and more – dangerous places to live, while provincial centres falter and fade away. The truth is, unless a provincial centre has some coal or iron-ore nearby, it is likely to be on its death-bed today.

Apart from all that, having all our population centred in the major cities is hugely inefficient as we only utilise a small proportion of one of our greatest national assets – our land. In the same way railways opened up the outback in the late 19th century, modern telecommunications have the ability to bridge our vast expanses and make the world smaller. Only by drawing investment and getting rid of the distance disadvantage experienced by regional Australia do we have a chance of keeping Australia alive outside the capitals.

Modern telecommunications is the answer and that is precisely what the NBN will provide.

In a perfect world, the Government would not need to pay for the NBN — private industry (big business) would do it based on the long-term profit principle. Unfortunately, these days, business leaders generally look for short-term returns — so as to boost senior executive bonuses via profit incentive schemes. Moreover, most investors don’t want to pay for something that costs a lot of money and may not pay back their investment for 15-20 years — as the NBN wouldn't. But that's fair enough, because nation-building and constructing national infrastructure is the Government’s responsibility anyway — or, at least, that's what we always used to think.

Anyway, that’s the theory about why the NBN will transform Australia and why it is so vital for our nation's future, as well as why it will probably give Labor another term in office. Now let me give you some practical examples about the way the NBN will, in practice, be able to transform business in Australia.

Case study 1: Big business and the NBN

For a period up until May last year, just before I founded this journal, I worked for a couple of years at a regional airport provider called Queensland Airports Ltd (QAL). QAL owns the Gold Coast, Townsville and Mount Isa Airports, along with an airport services company (security, catering) in various other airports around the state. It also, at that time, provided management services for Cairns and Mackay Airports and had other subsidiaries doing such things as aircraft maintenance. It was a diverse and diversified organisation, which was largely administered from the Gold Coast.

As its Finance Manager, no-one knew better than I did how much money QAL was spending on travel (hint: a lot). This was mostly managers travelling around the various locations keeping an eye on things and having meetings, but it was also ordinary employees travelling down to the Gold Coast and other places for training purposes, or trainers travelling to the regional offices.

In a laudable effort by senior management to cut costs and boost productivity, QAL installed a televisual conferencing system in some locations. It was a boon for those locations where it was installed – namely Townsville and the Gold Coast – because it meant meetings and training sessions could be done remotely. For everywhere else, the broadband network wasn’t good enough to bother — it just wouldn’t work. In Mt Isa and Mackay, all you would receive would be a fuzzy screen and crackling distant voices. So, the lost productivity and expense of pervasive employee travel continued – probably continues – at QAL, along with its associated dirty carbon footprint.

The NBN will allow big businesses to tap into the cheap overheads and vast untapped employment potentialities of regional Australia, allowing these places to once more become vibrant provincial centres. It was also help to limit urban sprawl, lower travel costs and save the environment, amongst a vast array of other benefits.

Case study 2: Small business and the NBN

The bush and the city - the real nature of Australia's "two-speed" economy

But that’s the advantages for big business — they normally do okay anyway, in general, because they are located in or close to major metropolitan centres. Most of the businesses in regional centres are small — and it is to them that the majority of benefits will accrue.

Long before I worked for QAL – when my son was only a toddler – we moved to the outer suburbs of Brisbane and my wife landed a job in IT for a big mining company based in Brisbane’s CBD. The thought of putting my baby in childcare at 7am every morning and heading off to work in the city myself made me to look at other options — just as many other Australians are forced to do.

In the end, I decided to start a suburban accounting and bookkeeping business. I did the books for a few small businesses around the place, usually travelling to their offices and using their resources. It was inconvenient, disruptive to them and me, it meant I still needed to put my child in care and, in the end, the business barely paid its own way. I spent almost as much time travelling to and from workplaces as I did working at them.

Being a systems accountant with a long history of establishing business systems for Fortune 500 companies in many parts of the world, I hit upon an idea that could have created a much more efficient system that would enrich me and my clients, while at the same time saving the environment and providing employment to a vast untapped source of labour.

The idea was simple, why drive to clients – or have them drive to me – when I could do almost everything necessary remotely over the internet? Beans are beans, whether they are counted in Brisbane, Brighton or Broken Hill.

And why limit my income by working as a sole operator when I could engage other well-qualified professionals who had chosen to stay at home to raise their kids rather than having them raised by an expensive childcare centres. I knew many of these people. They were intelligent, industrious people who would like to be able to work – and increase Australia’s dismal participation rate – but couldn’t bear to be apart from their children all day. They were mostly women with husbands in jobs that allowed the family to just make ends meet with the mother staying at home. I knew that if I could bring work to their homes without making them leave their children, they would be able to fit it in to their daily schedule. Even better, I found a number of people prepared to join the roster who, through physical ailments, were not in a position to leave their homes and go to work each day, but were quite able to make their way to their household PC and log in.

I also had a contact who offered “cloud computing” – that is, he had banks of secure servers for hire in South Brisbane – who offered me a good deal so that business people had the option to store all their accounting records and business software on a central server. In other words, they would enter their invoices and data over the internet and store them on a central server using accounting software hosted at that central location. Their bookkeeper, provided by me, would also have a password and be able to go in and do their BAS, tax and other administrative functions as and when required — at their leisure. There would be no outsider coming in to the small business person’s office and annoying them. No need for them to go out and buy accounting software and install and maintain it. In fact, no need for backing up data or buying an expensive computer with lots of memory — all this would be provided as part of the service I planned to offer.

Of course, clients would need to speak to the bookkeeper/accountant — but they could do this for free using Skype.

It was a great plan and I had lots of other ideas for future expansion, but unfortunately – for one reason only – the venture never got off the ground.

The reason? Well, in the northern suburbs of Brisbane (a metropolitan area, let’s not forget) at that time, we had (so-called) broadband with maximum speeds of only 512kb per second — and usually much worse. In testing, we found that just saving an ordinary Microsoft Word document onto the central server would take around 10 minutes. Just loading the accounting package QuickBooks was a painful torment. And no-one could possibly run a business where just entering an invoice took 15 minutes to save.

My clean, green, inclusive and productivity improving plan could not be done then under Australia’s third-world communications infrastructure. It still can’t — at least, not without the NBN.

The future

How many enterprising business people out there are similarly stymied today? How many of them are considering leaving their rural, or outer metropolitan area, to go closer to the CBD to get their idea going? Why shouldn’t someone be able to outsource their finance or marketing function to a company operating out of Biloela or Broken Hill? Let’s face it, the Coalition are discriminating against people living outside metropolitan areas by opposing the plan. The National Party in particular – a party that says it represents rural and regional Australia – should be especially ashamed of its shortsighted betrayal of its constituency.

What other ideas are there out there that can’t be implemented because we don’t have the adequate communications infrastructure to allow them to work? The Coalition must face up to its leadership responsibilities and not simply oppose everything the Government does as a matter of principle. If it is elected in 2013, it should promise to continue to implement the NBN. I daresay if it doesn’t, it may have little chance of success in the forthcoming election.

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