Broadband plan will change Australia forever


 Robert Gottliebsen

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I think it likely that one way or another Australia is going to be flooded with broadband capacity, slashing prices. Low cost broadband will bring dramatic change to the way we live and the way we conduct business. 

Productivity will sky rocket. As the internet becomes like electricity, it will make the current internet revolution akin to the old crystal sets that were the prelude to radio.

Rather than write another comment on the threats to Telstra and the new rules of infrastructure funding, plus the difficult road in the Senate, let’s concentrate on what this new world will look like for enterprises in Australia. There will not be a business that will not change dramatically.

Broadband on the scale envisaged by Rudd and Conroy goes very close to duplicating human contact, albeit electronically. That means business travel bills are slashed. Sure, there will need to be human contact from time to time, but for the most part it’s unnecessary.

 

While the most obvious cost reduction example is overseas and interstate travel, smarter enterprises will realise that it’s crazy for their employees to trek to a central place every day. Intercity travel will be slashed.

But the broadband revolution goes much further than travel. It effectively globalises the services industry. And so a surgeon in New York can carry out an operation in Hobart. Australia has well trained professionals, and they will be able to operate globally.

 

If a machine breaks down currently, experts must fly in. Now they will be able do the job from Australia. Education, at least at university level, becomes more of a global business. Top educators will receive a lot more, because they can amortise their talents over so many more students.

 

Australian companies that have been imprisoned on this island currently face enormous personal and monetary costs to do business overseas – that will end. Global internet marketing will take on new meaning.

Suddenly, the international community will be able to see our services and goods. New markets will be opened.

Domestically, internet retailing has not taken off as much as many expected, but it will gain great impetus. In a store, it will be easy to tailor promotions to the customer.

In our homes the internet, TV and radio become one and become linked to a whole new use of power.

People will still need physical contact and they may choose to have that physical contact via the shopping experience. But there will be great competition for physical contact as sports, art, restaurants etc provide that service.

So leaving aside costs, providing a massive broadband facility is the best possible thing for Australia, because you are investing in education, health and carbon reduction. And by going for economies of scale, we have the chance to make it low cost, which will be of enormous benefit to the nation.

 

Whether it is “economic” is another matter. Perhaps we would have been better to use wireless or other means to achieve a similar end. The broadband experts say that for really huge applications you need fibre. But that’s not necessarily right.

As pointed out before, the cheaper option was fibre-to-the-node. But that was made uneconomic because the compensation to Telstra was too high.

 

If this project goes ahead – and I think in some form it will – then Telstra will be very different and may be punished for forcing the nation into the expensive option.

 

This article first appeared on Business Spectator

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