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Better and faster broadband is vital to boost competitiveness

22 October, 2008

An Australian Industry Group / Deloitte CEO Survey has highlighted the critical importance of lifting the performance of Australia’s broadband network.

The survey, High Speed to Broadband: Measuring industry demand for a world class service, explores the views of Australian business leaders in this important area of public policy.

Ai Group Chief Executive, Heather Ridout said the report focuses on a breakthrough investment that has the potential to transform our economy:  the move to faster, high speed broadband.

“This technology will make a critical contribution to lifting productivity at a time when Australia’s productivity performance is lagging.  Investment in this technology is not important for its own sake. It is because the technology has the potential to transform the way Australian business works, with all the associated productivity benefits,” Ridout said.

Among the findings:

- Over 93% of companies indicated that the internet has had a positive impact on their efficiency/productivity.
- 66% of businesses believe their business will benefit greatly from faster broadband.
- 69.7% of regional firms would see a great benefit from faster broadband.
- Faster broadband is expected to lead to large increases in financial activity for 36% of businesses, with a further 45.1% of companies expecting small increases.
- 29.6% of small firms indicated they have a low degree of skills which would prevent them seizing opportunities arising from the deployment of high speed broadband.
- 73.5% indicated that they were likely to upgrade to high speed broadband, if available.

Reliability of service was the dominant factor influencing the extent of uptake.

“We are reassured by the Government’s commitment to press ahead with investment in the national broadband network despite the turbulence in global financial markets. 
This will clearly have an impact on the environment in which major infrastructure projects are delivered, affecting both the cost and availability of finance.  At such a time, it is crucial to look afresh at ways in which public-private partnerships can be delivered.  In short, the world has changed and we need to consider all the implications this will have for the roll-out of the National Broadband Network.

“Importantly, the report found that businesses of all sizes lacked the capability, and the skills, to maximise the gains from high speed broadband.  It is a particular issue for smaller firms with almost a third admitting they don’t have the skills necessary to seize opportunities provided by a national broadband network.

“There is a particular desire for high speed broadband from regional businesses eager to seize the commercial opportunities arising from a high speed connection to the rest of Australia, and the rest of the world.

“It is imperative that we get the pricing and access regimes for our National Broadband Network right.  These are deeply complex issues that provide challenges for Government and industry alike.  What is clear, at this stage, is the need to ensure that the correct policy framework goes hand-in-hand with any deployment of fibre on the ground,” Ridout said.

Damien Tampling Lead Partner, Technology Media and Telecommunications, Deloitte Australia, said the survey demonstrated the potential for broadband to fundamentally transform the way we do business in Australia.  “As the Broadband Network goes national, I believe that it will impact our professional and personal lives in ways that we are today unable to anticipate.  I would in fact imagine it moving from a discretionary spend to becoming more of a utility, most certainly in the home,” he said.

“From construction to implementation, this network will drive a range of business activity.  It is clear that job growth resulting from the deployment of a broadband network will stem not only from the immediate demands that arise from the construction, deployment and maintenance of the broadband network but from the longer term indirect demands that will be associated with new products, services and applications.

“We will see this translate into enhanced applications and services such as video conferencing, video on demand and VOIP into more work environments and even the home.  In fact 80% of respondents consider access to low cost telephony and expanded communications networks to be a very important or moderately important benefit of faster broadband.

“There is no doubt that there is a pent up demand for broadband and as the survey indicates almost 75% of businesses have indicated that they are likely to upgrade.  However businesses are looking more at using the increased speed to do what they currently do - download files and transact online faster.  It is not likely to be until some time after the network is deployed before we truly start to see its new applications and impact.  This is further underlined by the fact that only a small proportion of respondents (17.6%) believed that the adoption of faster broadband is likely to generate new products and services,” Tampling said.

“Our mind will hopefully soon turn to thinking more about how the broadband network can drive innovation and the delivery of new products and services, not simply how and when it will be available,” he added.

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