ATTACHMENT 1
FINAL REPORT OF THE SOUTH AUSTRALIAN PARLIAMENT’S
ECONOMIC AND FINANCE COMMITTEE INQUIRY INTO
THE NATIONAL BROADBAND NETWORK
PUBLISHED 1 DECEMBER 2015
PP233
FINAL REPORT
INQUIRY INTO THE NATIONAL BROADBAND NETWORK
88TH REPORT
OF THE
ECONOMIC AND FINANCE COMMITTEE
______
Tabled in the House of Assembly and ordered to be published on 1 December 2015 ______
Second Session, Fifty-Third Parliament Contents
Presiding Member’s Introduction 4
Executive Summary 5
Recommendations 7
1 Background to the National Broadband Network 9
The National Broadband Network 9 Initial Attempts to Start a National Broadband Network 9 The Rudd/Gillard Government’s FTTP-based National Broadband Network 10 The Abbott/Turnbull Government’s MTM-based National Broadband Network 12
2 Rollout of the NBN - Status Report 14
Fibre and Fixed Wireless Services 14 Satellite Services 16 The Technology Choice Program 16
3 How the delivery of the NBN can contribute to South Australia’s economic 18 growth, entrepreneurship and employment opportunities, in metropolitan and regional areas
Availability and Uptake of the NBN 20
4 How the delivery of the NBN can contribute to South Australia’s business 23 efficiencies and revenues, particularly for small and medium businesses and sole-traders
5 How the delivery of the NBN can contribute to South Australia’s research, 29 development and innovation
6 How the delivery of the NBN can contribute to South Australia’s productivity 31 and workforce participation
ICT Employment and Education Statistics 33
Page | 2 Economic and Finance Committee 7 How the delivery of the NBN can contribute to South Australia’s delivery of 35 government services and programs including health, education and training
Education and Training 35 School Visits by the Committee 40 Telehealth 42
8 What policy, program and other enablers will need to be in place to maximize 47 these benefits for South Australia?
9 The impact on South Australia following changes to the structure and schedule 51 of the Commonwealth Government’s NBN program, particularly ceasing the rollout of fibre-to-the-premises
The Multi-Technology Mix Model 51 FTTP versus FTTN 55 The Seal the CAN Project 57 Witness Responses Concerning the Copper Network 60
10 Other relevant matters 63
NBN Co Communication Issues 64 Unscrupulous Practices 66
11 Recommendations 69
Appendices
1 Inquiry Terms of Reference 87 2 The Economic and Finance Committee 88 3 Submissions Received 90 4 Public Hearings 91 5 Other Committee Activities - School Tours 94 6 Glossary 95 7 Timeline of Australian Telecommunication Milestones 97 8 Figures and Tables 100 9 Local Council NBN Survey 106 10 ACARA Digital Technologies Curriculum 114 11 Bibliography 116
Page | 3 Economic and Finance Committee Presiding Member's Introduction
The National Broadband Network represents the most significant change to Australia's telecommunications landscape since the creation of the old Post Master General's department more than a century ago. With the challenges facing the nation and this state as we move into the future, South Australia and South Australians need to embrace a digital future. To do so, it is imperative that we have a broadband network that not only meets the current demands of the state, but is also flexible enough to meet future demands, many of which have yet to be conceived.
The Economic and Finance Committee commenced this inquiry to allow a proper appraisal of several issues from a South Australian perspective. We need to know the current status of the network, the prospects for the future, and the likely effects of the change of government in 2013, and subsequent changes in policy. This inquiry has sought to address these questions and has delivered a set of nineteen recommendations that tackle these pressing matters.
On behalf of the members of the Economic and Finance Committee, I would like to express my gratitude to those people who either provided a written submission to the inquiry, or appeared before the inquiry to present oral evidence. We received a wide range of views and opinions, and we have endeavoured to do them justice in the compiling of this report.
Finally I would like to thank the members of the Committee, and the Committee's staff, who worked so diligently on this inquiry and on the preparation of this report.
Lee Odenwalder MP Presiding Member
50 November 2015
Page I 4 Economic and Finance Committee Executive Summary
In October 2014, the Economic and Finance Committee of the South Australian House of Assembly, on its own motion, announced an inquiry into the National Broadband Network. The inquiry received 18 written submissions from interested parties. These submissions ranged in size and scope from just a paragraph or two highlighting single issues, to extensively researched, multi-page documents covering many aspects of the inquiry’s brief. A full listing of the submissions received can be found in Appendix 3. In addition, the Committee held a total of nine public hearings during which it received testimony from 46 persons representing 29 different organisations. A full listing of witnesses heard can be found in Appendix 4.
The Terms of Reference, as displayed in Appendix 1, lists several areas of interest to the state and its prospects in a digital future. These include areas in which the National Broadband Network (NBN) could, and if properly implemented should, be expected to have a positive impact on South Australia and its economy. All these potential benefits are predicated on the network being rolled out in a timely fashion and in a form that best enables the recipients to maximise their particular benefit.
The rollout of the NBN in South Australia The Committee received evidence and heard testimony concerning the progress of the NBN rollout, and also the nature of the technology likely to be utilised in different regions of the state. The fundamental shift in the technological architecture that followed the change in Commonwealth Government in 2013 means that the existing copper infrastructure will be required to play a critical role in various components of the multi-technology mix model. The state of this infrastructure and its suitability for the increasing demands likely to be placed on it was raised before the Committee as a matter of urgency. The likely allocation of the various technologies to different areas of South Australia, and in particular the use of satellite in more remote regions, was also described for the Committee. The importance of proper communication and consultation, especially at community and business group levels, for the development and implementation of future digital policies was highlighted for the Committee.
Recommendations 1-5 are made in response to these issues.
The role played by state and local government The Committee was informed, by multiple witnesses, that until the general public and other stakeholders were able to observe the real benefits of broadband technology, uptake would remain at low levels. The Committee received evidence highlighting a positive correlation between the level of digital engagement by business and the revenue generated. The need for active government participation in the adoption of digital technologies was raised by several witnesses, as was the need for government not to stand in the way by imposing excessive planning or other regulatory burdens. It was also suggested that government should serve as an exemplar for the benefits of broadband technology by embracing new technology and work practices, such as teleworking by the public service.
Page | 5 Economic and Finance Committee Recommendations 6-10 are made in response to these issues.
The benefits of broadband on the health and education sectors The increasing role that digital technology is expected to play in the delivery of health services, particularly in remote areas of South Australia, was emphasised from both the teaching and medical practice perspectives. For example, the successful nature of several e-health trials was described for the Committee. It was stressed that in order for e-health programs to be successful, access to reliable, high-speed broadband is paramount.
Recommendation 11 is made in response to these issues.
The importance of the education and VET sectors to South Australia’s place in a digital future was made by several witnesses. In particular the increasing importance of science, technology, engineering and mathematics (STEM) subjects was raised, and valuable statistics provided for inclusion in this report. The need for the government promotion of ICT training at both the VET and university level was stressed for the Committee.
Recommendations 12 and 13 are made in response to these issues.
The Committee visited several schools and witnessed the incorporation of many aspects of digital education in the curriculum at various age levels. It observed early primary school students utilising digital learning tools, as well as high school students incorporating elements of the gaming culture in their learning. It was emphasised that the more enjoyable the students found these digital lessons, the less intimidated they felt. The Committee also learnt of the teething issues encountered by early adoption schools, and the ways in which these could be avoided as more schools come online in the future.
Recommendations 14-17 are made in response to these issues.
The benefits of broadband for South Australia It was indicated to the Committee that having access to high-speed broadband in semi-rural regions of the state, such as Willunga, had resulted in many people relocating to avoid issues associated with more concentrated urban environments. This is only expected to increase as more and more regions become connected to the network. The Committee heard that having reliable, high-speed broadband represented an opportunity for the promotion of regional growth in the state.
Recommendations 18 and 19 are made in response to these issues.
Page | 6 Economic and Finance Committee Recommendations
Recommendation 1 Page 69 The South Australian Government encourage NBN Co to publish detailed information on the condition of South Australia’s copper network.
Recommendation 2 Page 70 The South Australian Government advocate to the Commonwealth Government that it continue the rollout of fibre-to-the-premises, rather than fibre-to-the-node, to deliver high quality connections for households, businesses, schools and hospitals in South Australia.
Recommendation 3 Page 71 The South Australian Government ask NBN Co to publish maps of the expected technology to be used in all regions of South Australia.
Recommendation 4 Page 73 The South Australian Government advocate to NBN Co that the use of satellite services for small centres in South Australia be the technology of last resort.
Recommendation 5 Page 74 The South Australian Government advocate to NBN Co that it improves its communication with local government and community/business groups with additional on-the-ground staff.
Recommendation 6 Page 75 All South Australian local governments implement a digital economy strategy and monitor its performance.
Recommendation 7 Page 76 The state and local governments should serve as exemplars for the benefits of the NBN in the delivery of services, particularly in rural and remote areas.
Recommendation 8 Page 77 The South Australian Government embrace teleworking – both supporting state public servants to telework and encouraging other businesses to adopt more flexible practices.
Recommendation 9 Page 77 The South Australian Government actively support home businesses that utilise the NBN – including removing, as far as practicable, any planning red-tape that would prevent homes being used for such businesses.
Recommendation 10 Page 78 The South Australian Government investigate implementing a program to help small businesses connect with nearby ICT providers that can improve their digital presence and utilisation.
Page | 7 Economic and Finance Committee Recommendation 11 Page 79 The South Australian Government actively promote and, where possible, facilitate the implementation of telehealth programs in the delivery of primary health care and acute hospital services.
Recommendation 12 Page 80 The South Australian Government increase ICT training programs through the VET sector and encourage a similar increase in the university sector to meet the expected increased demand for ICT professionals.
Recommendation 13 Page 81 The South Australian Government through the public education system and the VET sector increase the provision of science, technology, engineering and mathematics (STEM) subjects to meet the projected demand.
Recommendation 14 Page 81 The South Australian Government expand the teaching of coding in public schools so that every public primary and high school student has access to this important skill.
Recommendation 15 Page 83 Technical and policy issues with the Department of Education and Child Development firewall be addressed to ensure schools receive the full benefit of the NBN.
Recommendation 16 Page 84 That Department of Education and Child Development, using the lessons learnt from early adopter NBN schools, prepare promotional material highlighting the benefits of being NBN connected for both teachers and students.
Recommendation 17 Page 85 All schools in the state implement an ICT strategy that ensures the benefits of being NBN connected are fully accessible to all students.
Recommendation 18 Page 86 The South Australian Government, in conjunction with local government, actively promote those areas of the state that have been connected to the NBN.
Recommendation 19 Page 86 The South Australian Government use the NBN and its benefits to promote regional growth in South Australia.
Page | 8 Economic and Finance Committee Chapter 1
Background to the National Broadband Network
Telecommunications1, as the modern world would come to understand the concept, essentially began in 1830 when Mr Joseph Henry demonstrated a device which transmitted a signal, across one mile of wire, causing an electromagnet to strike a bell.2 Shortly thereafter, Mr Samuel Morse constructed the first American telegraph (1835) which he patented in 1837. Within 12 months of this time, he was able to transmit approximately ten words per minute using his newly devised Morse code.3 In 1843, Mr Alexander Bain, who had previously built the first working examples of electric clocks, invented the world’s first facsimile machine; a clock mechanism allowed the transmission of crude images from one site to another.2 A timeline of major Australian telecommunications milestones can be found in Appendix 7.
Since these early times, the great driving principle behind telecommunications advancement has been the conversion of this technology from isolated, and in many instances unrelated, items of equipment into an ever expanding network reaching into every region and every niche of society. This is readily observable from the Australian experience by the growth of the Australian Postmaster General’s (PMG) Office to incorporate each newly developed aspect as it became available. The establishment of a national broadband network was an inevitable step in the evolution of Australia’s communication landscape.
The National Broadband Network
The National Broadband Network (NBN) is likely to represent the single largest development in Australian telecommunications since the establishment of the PMG more than a century earlier. As might be expected with any venture of this magnitude, the NBN’s formation was anything but smooth, being characterised by many false starts and missteps. A brief account of the early attempts to get this project underway follows.
Initial Attempts to Start a National Broadband Network
The Broadband Advisory Group was established by the Howard Government to look into the feasibility of creating a National Broadband Network. In 2003 it reported to the government, recommending that the Commonwealth work with other governments and interested industry
1. The word telecommunication itself is the anglicised version (c. 1932) of the French télécommunication, which was coined in 1904. The word is a compound of the Greek prefix tele-, meaning ‘distant’, and the Latin communicare, meaning ‘to share’. 2. (Burger, 2006) 3. (Telstra, 2015)
Page | 9 Economic and Finance Committee parties to create such a network.4 Subsequently, a Senate committee recommended that the ‘increasingly obsolete’ copper network be replaced by a new, optical fibre based network.5
In 2005, Telstra announced a plan to upgrade its ageing copper networks. Part of this plan included the rolling out of a fibre-to-the-node (FTTN) network.6 However, after failing to agree terms with the Australian Competition and Consumer Commission (ACCC) over third party access, Telstra dropped its plans.7
In response to the Telstra proposal, a consortium of nine internet service providers - known as the G9 and comprising AAPT, Internode, iiNet, Macquarie Telecom, Optus, PowerTel, Primus, Soul and TransACT - claimed this new network would lock out all competitors. In 2006, the group announced its intention to combine to invest in a FTTN network.8 In 2007, the ACCC rejected the consortium’s special access undertaking plan.9
The Rudd/Gillard Government’s FTTP-based National Broadband Network
In the lead up to the November 2007 federal election, the Rudd-led Labor opposition announced that the creation of a National Broadband Network would be a central plank of its campaign. In early 2008, after winning the election and assuming office, it appointed an Expert Panel to assess future proposals, with the ACCC to provide advice on pricing and competition issues.10
In April of that year a Request for Proposals (RFP)11 for the network upgrade was released, the stated objectives of which were to create a National Broadband Network that, among other things, would:
• cover 98 per cent of Australian homes and businesses; • offer broadband services with a minimum 12 Mbps dedicated downlink transmission speed over each connection provided to a premises; • support symmetric applications such as high-definition video-conferencing; • support high quality voice, data and video services; • use fibre-to-the-node or fibre-to-the-premises network architecture; • be rolled out and made operational progressively over five years from the date of execution of a contract between the Commonwealth and successful proponent; • have sufficient capacity to meet current and foreseeable demand and have specified upgrade paths within clear timeframes, consistent with international trends;
4. (Broadband Advisory Group, 2003) 5. (Environment, Communications, Information Technology and the Arts References Committee, 2004, p. v) 6. (Telstra, 2005) 7. (ZDNet, 2006) 8. (Allen Consulting Group, 2006) 9. (ZDNet, 2007) 10. (Australian Consumer and Competition Commission, 2009) 11. Copies of the relevant files relating to the various NBN tender processes and government announcements can be located at the archive section of the Department of Communications website: (Department of Communications and the Arts, 2007-2010)
Page | 10 Economic and Finance Committee • enable low access prices reflecting underlying costs while allowing proponents to earn a rate of return on their investment commensurate with the risk of the project; • provide benefits to consumers by providing choice to run applications, use services and connect devices at affordable prices; and • facilitate opportunities for Australian and New Zealand small and medium enterprises (SMEs) to provide goods and services to the project.
A total of six proposals were lodged - Acacia, Axia NetMedia, Optus on behalf of Terria, TransACT, the Tasmanian Government, and Telstra. However, Telstra’s proposal was excluded from the process due to its failure to submit mandatory information. In April 2009 the government announced that it was terminating the RFP process due to none of the remaining proposals being able to meet the scheme’s requirements.11
After the termination of the RFP process, the Rudd Government announced on 7 April 2009 that it would bypass the existing copper network and construct a new national network combining fibre-to- the-premises (FTTP), fixed wireless and satellite technologies. The major features of the new proposal as originally announced were11:
• the network to reach 90 per cent of homes, schools and workplaces with fibre to premises and provide speeds of up to 100 Mbps; • the remaining premises to be serviced using wireless technologies with speeds of 12 Mbps; • the provision of transmission links (‘backbones’) to major regional centres and rural towns which are inadequately served by commercially viable transmission services; • the network to take eight years to build and support 25 000 jobs on average for the length of the project, peaking at 37 000; and • the network to cost up to $43 billion.
The Commonwealth announced that it would have majority ownership of the company, with the intent of selling down its interest in the company within five years of the network being built and becoming fully operational. The government also announced that it would make an initial investment of $4.7 billion, primarily from the Building Australia Fund. Further funding was to be raised by the issuing of Aussie Infrastructure Bonds. The mix of debt and equity in the government’s investment in the company was to be worked out over time.
NBN Co12 was established on 9 April 2009 under the name of its company number, A.C.N. 136 533 741 Limited. Although the new company quickly came to be known as the National Broadband Network Company it was not officially renamed NBN Co Limited until 6 October 2009. It traded as NBN Co until April 2015 when it began trading simply as ‘nbn’.13
12. (Australian Securities & Investments Commission, 2009) 13. In the interests of consistency, the company is referred to as ‘NBN Co’ throughout this report.
Page | 11 Economic and Finance Committee The Abbott/Turnbull Government’s MTM-based National Broadband Network
After winning the September 2013 federal election, the new Abbott Coalition Government announced plans for a major overhaul of the network. It initiated a strategic review into NBN Co which was released in December of that year and recommended a change from the principally FTTP- based network to a network based on a combination of different technologies that became known as the Multi-Technology Mix (MTM) model.14
From the Strategic Review: …NBN Co will decide on its exact priorities after consultation with industry, government and other stakeholders. A high-level assessment of a multi-technology approach suggests that the eventual optimal mix of technologies in the fixed line footprint could be in the range of: • FTTP to ~20-26 per cent of premises; • FTTN/dp/B to ~44-50 per cent; and • HFC to ~30 per cent.
Fixed Wireless and Satellite will be used outside the fixed line footprint, along with some FTTN/dp.
The optimised technology mix reflects a set of considerations: • HFC will be provided as quickly as possible to the premises already connected; • FTTP will continue to be built until CY18 to maintain momentum. FTTP will also be used where it is the most economical choice, either because of high revenue potential (especially in business areas) or because of the high cost associated with deploying FTTN/dp; • FTTN/dp/B will be deployed in all other areas in the fixed line footprint; • FTTN in areas with relatively short-loop lengths; • FTTdp to complement the FTTN rollout in long-loop areas towards the end of the build; • FTTB especially for large MDUs, depending on the relative complexity of installing the competing technologies; and • Fixed Wireless and Satellite will serve 6 per cent of premises by the end of CY19.
The Optimised Multi-Technology Mix scenario results in the following outcomes: • ~40-45 per cent of the fixed line footprint will have at least 25Mbps in CY16 provided by NBN Co; • ~90 per cent of the fixed line footprint will have at least 50Mbps in CY19; • ~98-100 per cent will have at least 25Mbps by end of CY20; • Most areas in the fixed line footprint that currently, across the area, have no or very low levels of broadband (~8 to 10 percent of the fixed line footprint premises) will receive an NBN Co service, on average, two years earlier in the deployment than they would in all other scenarios…
14. (NBN Co, 2013)
Page | 12 Economic and Finance Committee In April 2014 the government accepted the strategic review’s recommendations and issued NBN Co with a new statement of expectations.15
In December 2013 the government announced the formation of a panel to conduct a major cost- benefit analysis (CBA) of the NBN and to review certain regulatory arrangements. The panel was chaired by Dr Michael Vertigan AC, and submitted three reports to the Minister for Communications. Specifically, these covered:
• Volume I - Market and Regulatory Report16 (released October 2014); • Volume II - The costs and benefits of high-speed broadband17 (released August 2014); and • Statutory Review under section 152EOA of the Competition and Consumer Act 201018 (released July 2014).
Put simply, the panel concluded that the Multi-Technology Mix could provide net benefits of approximately $18 billion to Australia, and would be delivered more quickly and at less cost, and provide the option of future upgrades to FTTP, once there is sufficient demand to make it worthwhile. The government released its response to the Vertigan review reports and the 54 specific recommendations contained therein in December 2014.19
15. (NBN Co, 2014) 16. (NBN Panel of Experts - Vertigan Review, 2014) 17. (NBN Panel of Experts - Vertigan Review, 2014(2)) 18. (NBN Panel of Experts - Vertigan Review, 2014(3)) 19. (Department of Communication and the Arts, 2014)
Page | 13 Economic and Finance Committee Chapter 2
Rollout of the NBN - Status Report
On 11 June 2015 representatives of NBN Co , Mr Justin Jarvis (National Manager, State Government Relations) and Mr Chris Gregory (Community Affairs Manager, SA), appeared before the Committee, where they provided the Committee with a status report concerning the rollout in South Australia. Mr Jarvis referred to the long term goal for the rollout:
…we recently announced the next tranche of construction in South Australia. So in December last year and then again in April, when we updated it, we have outlined construction for 280,000 homes and businesses across 77 communities in South Australia. I suppose that reflects the goal of making sure that we get NBN to eight million homes and businesses by 2020, which is our stated goal.20
Fibre and Fixed Wireless Services Mr Gregory outlined the 18-month forward plan of construction. The sites affected are collected in Table 1, with those areas in bold text representing the (then) most recently available (April 2015) additions to the plan.21
The witnesses also provided details of those areas in which rollout of fibre and fixed wireless has either been completed or is currently underway. These are collected in Tables 2-4 (Appendix 8), along with a pictorial representation (Figure 1) of the fixed wireless network in South Australia.
20. (Commitee Hansard, 2015, p. 182) 21. (Commitee Hansard, 2015, p. 184)
Page | 14 Economic and Finance Committee Table 1: NBN Co’s 18-Month Forward Plan for the SA Rollout. 22
REGION PARTS OF REGION COVERED Adelaide Hills Birdwood/Gumeracha, Lenswood, Macclesfield, Meadows, Mt Barker, Stirling Barossa Valley Kapunda, Nuriootpa Eyre Peninsula Ceduna (FW), Port Lincoln (FW), Whyalla Far North Coober Pedy, Pt Augusta, Roxby Downs Fleurieu Peninsula Goolwa, Port Elliot and Victor Harbor, Strathalbyn (surrounds), Yankalilla Greater Adelaide Adelaide/North Adelaide, Aldinga, St Marys, Gawler, Gepps Cross, Lonsdale, Modbury, Reynella, Two Wells Limestone Coast Bordertown, Bordertown (FW), Beachport, Kingston SE, Keith, Mount Gambier, Penola (surrounds), Robe Murraylands & Riverland Barmera, Berri, Loxton, Meningie, Mannum, Millicent, Murray Bridge, Naracoorte, Renmark, Tailem Bend, Waikerie Yorke & Mid North Ardrossan, Balaklava, Burra, Crystal Brook, Clare, Jamestown, Kadina/Wallaroo, Moonta, Port Broughton, Port Pirie, Peterborough, Riverton, Yorketown (surrounds)
In response to a question concerning what constitutes ‘building’ from the NBN perspective, Mr Jarvis replied ‘To be really honest with you, I think construction activity from an NBN perspective is when people are doing something in the ground; we've always thought that.’23
When then asked ‘How do you make a decision on what gets into this program?’ Mr Jarvis replied:
We pretty much leave that up to our experts, working generally with Telstra, which owns the infrastructure… We have to look at making sure that we don't create too many work fronts that are close to each other so that we could actually start cannibalising our own workforce; that's part of the process.
Also, in the broader multitechnology mix policy, which is the policy that we have had in place since the change of government, we have to make sure that we are looking at the most effective, quickest and cost-effective way to deliver it, and that's absolutely our policy. Some of those decisions are made for us because they are just so easy and obvious.24
22. (NBN Co, 2015, p. 3) 23. (Commitee Hansard, 2015, p. 183) 24. (Commitee Hansard, 2015, pp. 184-185)
Page | 15 Economic and Finance Committee Satellite Services
With regard to satellite services, Mr Jarvis stated:
…we are actually launching two of our own satellites… the satellite service we use at the moment is called the ISS… the interim satellite service… the NBN long-term satellite service will be providing a much more reliable, faster broadband experience for people… It is being launched this year. Two of them are going into space this year, and by this time next year you would have expected a pretty decent number of dishes to be rolled out. …It is being launched from French Guiana and it is being launched by, what I understand is, one of the best companies launching satellites. That satellite will then start a migration process of taking people off the old one.25
In response to the question ‘In terms of those decisions about what the speed of the satellite is going to be, is NBN Co going to make a decision about what the guaranteed speed from a satellite service will be?’, Mr Jarvis replied:
We kind of already have. It's 25/526, and when I say guaranteed for that, that's a wholesale price, so there could be ways the retailer cuts these programs, particularly with satellite, which is contended in the sense of the more on it, the more competition. For most people, 25/5.27
The Technology Choice Program
The witnesses made reference to the Technology Choice Program, which will allow individuals and communities to upgrade their service, at a cost. Mr Jarvis stated:
We have a program… called Technology Choice, which is at the moment focusing on individual communities looking at a co-investment opportunity with NBN to go on an upgrade path to move to a different technology. We have to look at that process on a commercial basis.
So technology choice—it is about co-investment, and with the applications for it the aim is for them to get in, in advance of the construction program. What we have not wanted it to be is a way of the community buying a quicker service. We want to maintain the fairness of our rollout process, which is non-discriminatory, in a sense, but what this allows is for a community to say, 'Hey we've got some resources here we would like to put in to invest’, and we obviously need to agree and then we would change the technology type.28
From the literature on the NBN Co website, the two different upgrade paths are described as:
25. (Commitee Hansard, 2015, pp. 205-206) 26. 25 Mbps download speed and 5 Mbps upload speed. 27. (Commitee Hansard, 2015, p. 207) 28. (Commitee Hansard, 2015, p. 206)
Page | 16 Economic and Finance Committee Area Switch: An Area Switch application typically is a request for FTTP connections, rather than FTTN, FTTB or Fixed Wireless connections. However, an Area Switch application may also include new Fixed Wireless, FTTB or new FTTN infrastructure.
NBN Co recommends that the minimum size of an Area Switch is one of the following: • A whole node (150-350 premises); and • A whole Multi-Dwelling Unit (MDU).
Smaller Area Switches covering a portion of the premises in a node area may also be possible, but are unlikely to be as cost-efficient with regard to network deployment…29
Applicants may be incorporated associations, bodies corporate, local government authorities and state government bodies.
Individual Premises Switch: Applicants can be individuals, representatives of small groups of premises, bodies corporate, businesses, incorporated associations, local government authorities and state or territory government organisations.30
Cost: The cost to change technology infrastructure for Area Switch could range from tens of thousands of dollars to few millions of dollars and for Individual Premises Switch from few thousand dollars to tens of thousands of dollars where the cost is generally dependent upon size and complexity of the project.31
The available technological upgrades under the Technology Choice Program are collected in Table 5, located in Appendix 8.
29. (NBN Co, 2015(2), pp. 5-6) 30. (NBN Co, 2015(2), p. 12) 31. (NBN Co, 2015(2), p. 4)
Page | 17 Economic and Finance Committee Chapter 3
How the delivery of the NBN can contribute to South Australia’s economic growth, entrepreneurship and employment opportunities, in metropolitan and regional areas.
The Australian Computer Society provided a large, wide ranging submission to the Committee that covered many various aspects of issues listed in the different terms of reference of the inquiry. In summary, its opinion is that high-speed broadband is a ‘game changer’:
It is not simply about doing more of what we do now online, or doing it faster. It is about doing things differently and doing things never previously envisaged.32
Furthermore, it believes that the debate should be less on the infrastructure issues and more on how broadband can be of benefit to the SA economy and its citizens.33
In its submission to the Committee, the SA NBN Taskforce listed examples where the NBN would be expected to have a direct impact on South Australia. These examples included the mining industry, the farming industry and regional South Australia in general, and small businesses across the state. All of these sectors are likely to benefit directly from having access to fast and reliable broadband services.34
The City of Victor Harbor provided a submission in which it identified three ways that fast internet can create competitive advantages:
1. Access to new markets 2. Increasing share of current market through more effective communication strategies, diversification of offerings and better customer service 3. Reducing the cost of business through increasing business efficiencies
It also believed that it would be possible to increase investment in Victor Harbor based on NBN infrastructure in the following ways:
1. Communicating to business investors the competitive advantages the infrastructure can create for their business 2. Promoting the benefits of the NBN for home based business, pre-retirees, and as a lifestyle benefit.35
32. (Australian Computer Society, 2014, p. 8) 33. (Australian Computer Society, 2014, p. 3) 34. (SA Government National Broadband Network Taskforce, 2014, pp. 2-4) 35. (City of Victor Harbor, 2015, p. 1)
Page | 18 Economic and Finance Committee In its testimony to the Committee, the City of Onkaparinga outlined the benefits the NBN had provided to its local community in terms of business support and also its success in attracting new residents.
We are lucky in the City of Onkaparinga that we have 15 quite active business associations attached to pretty much every suburb. There is one at Marion for Edwardstown and, of course, we've still got Victor Harbor, Strathalbyn and Normanville business associations as well on the Fleurieu - and Strathalbyn. I think it's a great role for the business associations because, surprisingly, a lot of the business association members are quite digital savvy. Many of them are home- based businesses and that's why they are home-based.
Having the broadband in our southern region has definitely attracted some people to live down here now. Many people who had holiday homes, or didn't, are now moving down here because of the NBN. There's a lot of professionals out there, international traders and some significant high-level management people now living in our area because of the NBN. So, being able to share that knowledge, I think, is really important.36
In its oral testimony, Port Augusta City Council discussed the impact of the removal of federal funding on its ability to prepare for the arrival of the NBN, as indicated by this exchange:
Would you be able to expand on the grant funding that was proposed and when it was taken away?
Well, as I understand … it was part of the original NBN offering. There were non- competitive grants available through the NBN in the initial stages of this. In other words, it was virtually a situation where we were able to get $300,000-odd uncompetitively, but that all fell through as far as I'm aware.
Yes, we were unsuccessful.
So that's similar funding to what councils like Prospect and Onkaparinga have used in the city to set up their hubs?
That's exactly correct, yes.
So, you have been told by NBN, or by the federal department, that there won't be any funding provided to help take-up in Port Augusta?
That's it.
And that's then put a big question mark over the establishment of the digital hub and the learning centre, plus the establishment of an Aboriginal digital community centre?
36. (Commitee Hansard, 2015, p. 116)
Page | 19 Economic and Finance Committee Yes, that's right.37
It also indicated the problems it, as a regional council, faces in comparison to its metropolitan counterparts:
I'll give you an example. You would be aware of the Prospect model - one of the first ones to take up the NBN in the city. At that council, they created a director that looked after NBN only and had staff specifically put toward that project, and that is why it was so successful. Our council just doesn't have the capacity to be able to deliver that sort of unit of council, if you like, to specifically look at NBN delivery. It's as simple as that. It's a resource thing; it really is.
The reality is, if you look at the Prospect model, that they took one of their directors and re-engaged him within NBN. We haven't got the capacity to do that. We are a council that's already under-resourced and overcommitted with services. I don't want to go into that because that's not here today, but that's our struggle. Our struggle is delivering so many things with so little resources, and NBN Co would just be another several hundred thousand dollars a year of resources to be able to try and do some of these things moving forward. I'm not hiding from the fact we should be doing them: it's just that we haven't had the capacity.38
Availability and Uptake of the NBN
Regional Development Australia – Far North, in its testimony, discussed issues with satellite coverage:
There are huge issues with that at the moment, especially with School of the Air or any platform that requires a government firewall breach. Through the government firewall there are real issues. The second satellite, or the new satellite, it's hard to pin down a date of when that's going to occur. Probably the biggest issue is when is it coming, because that's meant to be the panacea for all for those in remote areas.
Another option to that also is we've talked with NBN in terms of their interim satellite service, the bridging, I guess, service until that second satellite comes online. We don't have dealings with the pastoral properties, those sort of people, who want to hook into an interim satellite service, but the minimum number of people who can sign up for that service is very small. So in terms of School of the Air, people in education and health, if we're talking that from a communications perspective, they're still out in the dark because there's no guarantee to what's going to happen or be provided…
And that matter is accentuated when there's no mobile phone coverage in a lot of these places. The phone system in a lot of places is a radio telephone system, which
37. (Commitee Hansard, 2015, p. 3) 38. (Commitee Hansard, 2015, p. 8)
Page | 20 Economic and Finance Committee atmospherically comes in and out. We've had situations with Blinman in the Flinders Ranges in the middle of a peak tourist season and the EFTPOS machine doesn't work. No-one carries cash, so they're having to sell fuel with a barter system.39
It also discussed the possibility of other parties establishing a broadband network:
My understanding is that there are some mining companies that have put in an alternate system because the bandwidth availability on the satellite is not good enough for what they want to do, and that would be Beverley; they were doing a wireless link that came from Wilpena. I am not sure whether it was ever implemented, but it was putting in a wireless link so that they could get some broadband access out to Beverley. They were going to provide free of charge access to that service to the communities along the way, which would be Blinman and the pastoral properties because the bandwidth on the satellite was oversubscribed.
We all know that Santos for years has had its own system in place. It's cheaper to ring Adelaide from Moomba than it is [to] ring Moomba from here because they have a connection to Adelaide, and that's being going on for 20 or 30 years. They are just examples of where there they have had to find an alternate solution because the standard solution is not the best solution.40
When asked what impediments there were to such third-party activities, for example requiring a critical mass, its response was:
Yes, it is a critical mass. At the big end of town there is not enough money in it for them. As I said earlier, Telstra has a monopoly in the Outback for telephone services. We recently have been talking with Optus. We did not do it, but we have been talking with Optus and it has just put in a new satellite technology mobile phone coverage in Oodnadatta, early in February. It is a trial. It is the first time Optus has come outside where their network is, and they actually do not have to buy any back haul off Telstra, so in theory it is reasonably inexpensive.
If this trial works it could be dotted around the whole of Outback Australia, because it becomes viable… So the more competition the less critical mass is required.
I think the outback is quite innovative over its history. It's had to find solutions to problems because the mainstream stuff doesn't work. A lot of our communities provide water supplies because SA Water won't do it, so if Telstra or Optus or the NBN don't do the broadband, the communities are prepared to do it and that thinking comes into the OCA and the way we operate because we have to. We don't have the dollars to do the big end of town solutions…41
39. (Commitee Hansard, 2015, pp. 27-28) 40. (Commitee Hansard, 2015, p. 28) 41. (Commitee Hansard, 2015, pp. 32-33)
Page | 21 Economic and Finance Committee In its testimony before the Committee, the Office for Digital Government addressed the issues of availability and uptake of the NBN in the following exchange:
As a percentage of total households in the state, we currently have, according to NBN Co's latest numbers on their website, .08 is the ratio of premises passed as a ratio of households and actual premises activated is .02.
Could you explain what those numbers mean, .08 and 0.02, and what you are measuring?
NBN Co releases information about the number of premises -
Is that a percentage?
It's a ratio, yes, effectively.
Of what to what? So .08 -
The total number of premises or lots passed and covered - and this is a NBN Co figure - for South Australia is 53,000. If you divide that by the number of premises in South Australia, which is 685,000, you would get a ratio of .08.42
Mr Rowan Ramsey MP, Federal Member for Grey, spoke about the allocation of satellite and fixed wireless services in rural sites:
Following the experience of the temporary satellite service, it became quite apparent that there were more people going to be wanting to hook in on satellite than the previous NBN board had estimated when they commissioned the satellites.
Consequently, not wanting to overload the new satellites, the new NBN board has commissioned the building of a lot more fixed wireless than we had originally anticipated … So the fixed wireless program now is quite a bit bigger than it was two years ago projected to be.
I think most of the towns you're talking about are going to get fibre to the node and then the infill around those communities…
That would be great if true. There's a lot of anxiety around that from different people.
Once again, that's because the announcement hasn't been made. The NBN board and the minister are not keen to make an announcement about what is going to happen in three years' time because then people start getting excited, or else depressed by the fact that it's such a long time. Let's get some runs on the board, let's get some premises hooked up and then we will tell you what we are doing next. It's a very conscious decision of the minister not to overegg the expectation and try to build up things before we get here.43
42. (Commitee Hansard, 2015, p. 105) 43. (Commitee Hansard, 2015, pp. 99-100)
Page | 22 Economic and Finance Committee Chapter 4
How the delivery of the NBN can contribute to South Australia’s business efficiencies and revenues, particularly for small and medium businesses and sole-traders.
In its written submission, the ACS made reference to a survey44 conducted of SMEs, the results of which they described as worrying. These results were:
1. 3 in 5 SMEs claim low levels of digital literacy are preventing them from running their business more efficiently. 2. Only half have tried to improve their digital literacy. 3. 4 in 5 SMEs claim there should be more help and guidance to help them embrace the digital economy. 4. Among Australian SMEs that have tried to improve their digital literacy, the most common methods are through independent learning tool (sic) such as online search (65%) and online tutorials (49%). 5. Australian SMEs claim the most effective method to increase their own levels of digital literacy would be a fully funded training course, followed by access to a website with small business advice. 6. Only 34 percent list their contact details online, despite this being increasing (sic) the method most Australians find information. 7. Only 1 in 5 advertise online, less than 1 in 10 use cloud based software solutions for their business, and only 26 percent use the internet to sell.45
To rectify this situation it made the following specific recommendation:
3. To improve the digital literacy of SMEs, a program be developed which includes the following key elements: • working with individual businesses to benchmark their digital literacy and identify their specific areas of weakness • …help broker for them relationships with relevant “best in breed” ICT suppliers • the program be delivered on a regional basis and involve collaboration between State Government, ACS, and SME diagnostic specialists working with local stakeholders such as local governments, chambers of commerce and industry sectoral bodies; and
44. (Australian Computer Society, 2014, p. 19) 45. (Australian Computer Society, 2014, pp. 19-20)
Page | 23 Economic and Finance Committee • The program to be initially seed funded by Government, but with ownership and funding arrangements transitioned over time to the local stakeholder community.46
The ACS, in response to a question about the need to ‘properly equip those people to get the skills to be able to maximise the benefits of the high-speed network’, replied:
That's absolutely of paramount importance, I think, because South Australia, from a business person's perspective, runs on small to medium enterprise and so we need to make sure that our people who are in small to medium enterprise have the ability to tap into the skill sets that they need and the education that they need to move their business forward and, as you say, to be able to use a high-speed network to its best advantage for economic gain for this state.47
To the follow up question ‘Would you say that those who don't equip themselves will either fall by the wayside or fall terribly behind in its business?’ it responded:
I think we would see businesses go out backwards if they don't embrace it.48
When asked ‘What sort of communication do you think needs to be in place to help businesses’ it stated:
I think it has to be clear, pragmatic advice and information, because I think there are a lot of small businesses who have no idea… So, I think it needs to be clear and concise, and in the terms of business.49
The ACS went on to discuss a scheme it operated, in collaboration with a company, Digital Business Insights, that attempted to put companies seeking ICT advice and support with those companies able to provide the services:
A bunch of councils in Melbourne took up this offer, and we did some work in there with those councils to do the same thing. We did the surveys, identified local IT providers, and essentially ran workshops where they all got into the same room and business cards were exchanged. So, there was real business happening there on the ground. That concept can be tailored to an individual region, or it can be done to a state, but the template is there…
In terms of realising the benefits, these businesses going about their usual business might not necessarily realise that, if they invest in this, they can actually increase their business.
That's right; they don't know what they don't know, in a sense, and that is understandable, because they are so busy running their business.
46. (Australian Computer Society, 2014, p. 5) 47. (Commitee Hansard, 2015, p. 85) 48. (Commitee Hansard, 2015, p. 85) 49. (Commitee Hansard, 2015, p. 88)
Page | 24 Economic and Finance Committee We have also had initial discussions here in South Australia on exactly this kind of process. Certainly, there is definitely interest from small business where we have done that. We have had an initial discussion with the Department of State Development, and they were keen to see how it rolls out in Queensland before going forward here, but there is certainly an interest.50
Representatives of the Office for Digital Government were asked to outline the ways in which the state government is ‘working to maximise those benefits both for government services but broadly for the business or community sector.’ Their reply:
We've got an e-business program where we provide funding to business associations, councils, other representative bodies, to work with their constituents, their small business constituents, to raise awareness of what's possible using online technologies and, more recently, how the NBN can help them with their business.51
In its written submission, the SA NBN Taskforce addressed this specific term of reference by stating its beliefs that:
The NBN will be an enabler of economic development, entrepreneurship, and business efficiency by: • supporting digitally enabled industries to leverage new high speed broadband capacity and speed • encouraging the establishment of new NBN-enabled businesses • enabling established businesses to diversify into new NBN-enabled market opportunities • improving efficiency and productivity through faster electronic business practices • allowing businesses to locate outside of major cities, where overheads are lower, therefore facilitating and broadening employment opportunities in regional areas • accessing skilled labour and services beyond the local market area • allowing teleworking opportunities and minimising cost of overheads for businesses. The NBN is expected to boost telework more than previously thought… • faster connections will improve all aspects of online communication for businesses: email; voice applications; video-conferencing; and sending, receiving, downloading and accessing files online. In particular, the speed and efficiency of international communication will see a strong boost from the implementation of the NBN • businesses in rural or remote regions will benefit most from the NBN
50. (Commitee Hansard, 2015, p. 88) 51. (Commitee Hansard, 2015, p. 104)
Page | 25 Economic and Finance Committee • the biggest single factor between businesses that are performing well and those that are struggling is that businesses that are using online technologies such as website or cloud computing are far more likely to see their revenue grow and be optimistic about the future… • home-based businesses are a major contributor to economic and social development through employment growth and innovation development … • broadband is critical to home-based businesses with 93% having considered the Internet important or vital to their jobs (65% considered it vital) • home-based businesses act as a micro incubator by assisting new small business generally to survive and grow through reduced overheads, particularly with regard to new business with new ideas and concepts too expensive to test in businesses based in commercial premises • universal access to high-speed broadband networks amongst members of supply chains is an important determinant in supply chain performance and the participant’s ability to compete.52
Both it and Business SA made reference to a study53 conducted by Deloitte Access Economics that found:
Small businesses with high digital engagement earn twice as much revenue per employee as those with low digital engagement. Median revenue per employee for small businesses with very low digital engagement was $87,500 while, for small businesses with a high level of digital engagement, revenue per employee was $187,500.
This study acknowledged that while these figures:
…could reflect a number of business and industry factors, it also highlights the link with digital engagement. Less than half (46%) of small businesses at the early stages of digital engagement reported they were expecting to grow over the next 12 months, whereas a majority (83%) of high digitally engaged small businesses were expecting to grow.
Business SA also stated its belief that:
South Australian businesses need to have access to reliable and high speed broadband in order to remain competitive and meet their business needs. This 21st Century infrastructure needs to be delivered as efficiently as possible and be able to expand and change with demand and consumer need.54
The City of Victor Harbor outlined the issues it faced in raising the digital sophistication of its local businesses:
52. (SA Government National Broadband Network Taskforce, 2014, pp. 5-6) 53. (Deloitte Access Economics, 2013, p. 4) 54. (Business SA, 2014, p. 3)
Page | 26 Economic and Finance Committee …most of our local businesses had a relatively low level of digital sophistication. They didn't really know what opportunities were available, nor have the skills to take advantage of them. Hence, an intense education program delivered locally is required. A two step process is necessary involving raising awareness of the opportunities and then upskilling local businesses such that they can implement those advantages…55
It further believed that the council itself should serve as an exemplar and outlined the initiatives undertaken after being the recipient of a grant under the Commonwealth Government’s Digital Local Government program:
The grant enabled the installation of high quality teleconferencing facilities and video calls at all customer service points. The Council is also introducing an online booking system for accommodation and attraction bookings through the Visitor Centre, and in the coming financial year, pending funding, will install permanent Digital Art infrastructure and Wifi on the Mainstreet, as a very visible indicator of Victor Harbor's leadership in the Digital Economy.56
It also believed that an awareness campaign is necessary:
"If you build it they will come" is a fallacy. We are very aware that a large communication campaign will be required to stimulate both local and new business investment and to increase the levels of permanent residents in Victor Harbor.57
The City of Onkaparinga, in its written submission, stated that:
Smart Capacity is key - raising the level of digital skills for people living, studying and working in our community is vital.
Many residents of all ages, but particularly the younger generation, are all over this skill requirement. However Small to Medium-sized Enterprises (SME's) and sole- traders seem to be lagging.
Home Based Businesses of course seem to be leading early adoption in digital economy uptake (particularly for teleworking and e-marketing elements).
Our Digital Enterprise Program which serviced over 250 local businesses proved that most cutting edge digital business practices can be implemented now even before the NBN arrives (NBN just makes things faster and reliable).
We have seen the natural evolution of a local Digi-Club network in Onkaparinga suburbs where NBN has been completed, as SME business owners seek peer sharing
55. (City of Victor Harbor, 2015, p. 2) 56. (City of Victor Harbor, 2015, p. 2) 57. (City of Victor Harbor, 2015, p. 2)
Page | 27 Economic and Finance Committee of what works best and for identifying small business digital trends in the real world.58
The personal benefits of teleworking were outlined by Ms Stewart-Rattray of the ACS:
I spend a lot of time in the United States and in South-East Asia, and my client base here in South Australia have no idea where I am at any time. I could be sitting at home in Auburn, or I could be in my office in Adelaide, or I could be in Tokyo. That is the ability of being able to telework. It means that you can work anywhere any time, and it is terrific. I have colleagues who work in that environment who have kids as well, so it means people can get back into the workforce much more quickly if they have that ability. That's a very positive thing.59
The business benefits of teleworking were described by the Office for Digital Government:
We have companies in South Australia who work internationally and receive international awards for their work in the film industry. They use very high bandwidth services because they are working with film companies in the US and sending information over there and sending their products and outputs over there. There is demand always for high-speed as well as other speed broadband from a variety of technologies.60
Business Port Augusta discussed the practicalities of running a home business in Port Augusta at the present time, as shown in the following exchange:
Do you find it very hard to do the work at your house that you would otherwise do at work?
Yes, definitely; it's a lot slower.
And that is even with the existing internet infrastructure and not taking into account NBN or anything?
No, NBN will just open up a whole new bag for everyone.61
58. (City of Onkaparinga, 2015, p. 1) 59. (Commitee Hansard, 2015, p. 89) 60. (Commitee Hansard, 2015, p. 104) 61. (Commitee Hansard, 2015, p. 14)
Page | 28 Economic and Finance Committee Chapter 5
How the delivery of the NBN can contribute to South Australia’s research, development and innovation.
The SA NBN Taskforce, in its submission to the inquiry, made the following points regarding research, development and innovation:
Innovations are ultimately driven by skilled people, working creatively and collaboratively to solve problems, improve products and processes, and venture into new products and services that create value.
Australia has some world-leading research and globally competitive companies but our stock of intellectual capital is lagging behind other nations, including the once developing countries.
Our students’ performance in the building blocks of innovation- the science, technology, engineering and maths (STEM) skills has been steadily declining over time when a number of our competitors have been improving their performance…
Access to high-speed broadband infrastructure is therefore essential to enable young people to attain STEM skills that will equip them to compete in a globally connected world.
South Australia’s research and education sector is highly reliant on high speed broadband connectivity for information gathering and sharing and increasingly, the online delivery of course content.
Faster data speeds have already enabled course content to be delivered online, including live-stream and interactive lectures between students and lecturers located in different campuses or countries. This flexibility has given rise to MOOCs (Massive Online Open Courses) where online courses are delivered aimed at unlimited participation and open access via the web.
The delivery of the NBN is expected to have an immediate and significant impact on the higher education sector. The NBN would provide equitable access to the majority of South Australia’s population and could also present new opportunities for our education providers to deliver content in to new markets.62
The Australian Computer Society also raised the issue of STEM-based subjects in the education system and how they might be addressed; these are covered in Chapter 7.
62. (SA Government National Broadband Network Taskforce, 2014, pp. 6-7)
Page | 29 Economic and Finance Committee The City of Onkaparinga outlined its philosophy towards research and development in its submission to the inquiry:
The City of Onkaparinga - Digital Economy Strategy working group recognises that NBN is only part of the digital solution for the region to catch up with the global economy.
Other smart infrastructure like 4G LTE, 1Gb WiFi, data centres and dark fibre connectivity are also vital. So this Parliamentary inquiry should be expanded beyond just NBN to formulate a holistic digital economy future.
The City of Onkaparinga is already considering other smart infrastructure to benefit both council and the communities it serves, including M2M sensor networks, smart metres, building controls, digital signage, mobile real time CCTV, private WiFi citywide mesh network, and city Local Area Networks in the field and iconic locations.
Smart Innovation embodies digital technology solutions that create personalised location specific services and applications; and changes to traditional business models.63
A recent report from the Harvard Business Review analysed the digital economies of 50 countries and placed each into one of four categories, specifically:
Stand Out countries have shown high levels of digital development in the past and continue to remain on an upward trajectory;
Stall Out countries have achieved a high level of evolution in the past but are losing momentum and risk falling behind;
Break Out countries have the potential to develop strong digital economies. Though their overall score is still low, they are moving upward and are poised to become Stand Out countries in the future;
Watch Out countries face significant opportunities and challenges, with low scores on both current level and upward motion of their DEI. Some may be able to overcome limitations with clever innovations and stopgap measures, while others seem to be stuck.
The report said the following:
Most Western and Northern European countries, Australia, and Japan have been Stalling Out. The only way they can jump-start their recovery is to follow what Stand Out countries do best: redouble on innovation and continue to seek markets beyond domestic borders. Stall Out countries are also aging. Attracting talented, young immigrants can help revive innovation quickly.64
63. (City of Onkaparinga, 2015, p. 2) 64. (Harvard Business Review, 2015)
Page | 30 Economic and Finance Committee Chapter 6
How the delivery of the NBN can contribute to South Australia’s productivity and workforce participation.
In its testimony before the Committee, the ACS stated, as part of its opening statement:
…if South Australia is to fully capitalise on immense opportunities created by the combination of high-speed broadband and rapidly advancing digital technologies, we must ensure that we have an adequate supply of appropriately skilled ICT people, ICT professionals in fact, working in all sectors of our community.
The critical importance of ICT skills and digital literacy generally is now widely recognised as being a key to building successful economies. The emergence of the digital economy presents two key challenges for South Australia… The first, we believe, is to ensure that our education and training system is attracting and producing the appropriate number of quality ICT graduates. At present this is not occurring and we present evidence in support of that in our submission.
The key to turning this around, in our view, is to generate genuine engagement in ICT and a career in ICT among our schoolchildren, particularly primary school children at that. This can be addressed in a number of ways, but a fundamental requirement is to introduce a digital technology subject as a mandatory part of the curriculum. Digital skills needs to be viewed as a foundation skill alongside maths and English in today's world. This is a very live debate in Australia at the moment, and we see encouraging signs that most state and territory governments are moving in that direction, but there needs to be a greater urgency in our view.
The second challenge relates to the significant disruption to industries and jobs that digital technologies are creating. Deloitte Australia in its 2012 report, 'Digital disruption—short fuse, big bang?' highlighted industries in Australia that will be most impacted by technology advancements. Five of them are of above average significance in the South Australian economy as measured by share of GDP. These industries are: retail trade, education, agriculture, government services, and utilities.
So, the relative impact in South Australia in terms of job losses associated with digital disruption can be expected to be more acute here than in some other states. We can add to the list the automotive industry which, as we all know, is facing significant job losses in South Australia, which will bring about many thousands of displaced workers.65
65. (Commitee Hansard, 2015, pp. 80-81)
Page | 31 Economic and Finance Committee When asked if retraining was accessible for workers likely to be displaced, the ACS response responded:
Yes. The ACS has a lot of training programs available online and we do bespoke training, so yes, it is accessible. At the minute it is accessible to members, but we could package that to bring to bear in something like bespoke training programs for displaced workers. We can do that. We've also had initial discussions with the department of state development as well.66
This led into a discussion concerning the state of the ICT job market in South Australia:
Do you think with those jobs that are disappearing that there are opportunities in IT for those people who are not really into IT?
I think they need to be. My personal view is that we are in a state now where IT is so embedded in everything that we do that you have to have a level of literacy. That's the battle that I think we are fighting, that literacy of technology, so the answer is yes.
What is the state of the current ICT jobs market in South Australia if a company goes out for a particular type of ICT worker?
It is very difficult to get certain jobs. I am director of information security and IT assurance in my day job, so I head a consulting practice, and if I want to get a specialist in my field it's almost impossible.
So you have to advertise interstate or internationally to try and get some people?
I usually actually go to my professional body and network, so it's not an easy process. It would be lovely if there were some more skilled people out there. 67
In its written submission, ACS quoted the Australian Chief Scientist’s September 2014 Report Science, Technology, Engineering and Mathematics: Australia’s Future:
It is estimated, for example, that scientific and technological advances have produced roughly half of all US economic growth in the last 50 years. In Australia, 65 per cent of economic growth per capita from 1964 to 2005 can be ascribed to improvements in our use of capital, labour and technological innovation—made possible in large part by Science, Technology, Engineering and Mathematics (STEM).68
The ACS further stated:
ICT and computing skills – which are part of the STEM set of skills – are core to successful economies in an age where digital technologies dominate. Yet it is estimated that in Europe, while STEM occupations are expected to grow by 14% by
66. (Commitee Hansard, 2015, p. 81) 67. (Commitee Hansard, 2015, p. 82) 68. (Australian Computer Society, 2014, p. 4)
Page | 32 Economic and Finance Committee 2020 (compared to 3% for other occupations), the supply of workers with education qualifications in STEM subjects is projected to actually fall. In the United States, employment in these STEM occupations is projected to grow almost as fast between 2008 and 2018 as employment in all other occupations combined. Further, the European Commission estimates that by 2020, there will be 900,000 jobs in the European ICT sector unfilled due to a lack of appropriately skilled workers.69 and
There is, however, a “dark” side to the story of the digitally powered economies and the emerging demand for more knowledge based roles. And that is that much of the growth is and will come at the expense of older, established industries and occupations. “Digital disruption” is the commonly used term to describe this phenomenon.70
ICT Employment and Education Statistics
The ACS has collected statistics of all workers employed in ICT positions, broken down into state figures for the individual industries.71 These data, as well as data concerning IT enrolments and completions respectively on a state by state basis, are collected and displayed as Tables 6-9 (Appendix 8).
In a 2013 report, the former Australian Workforce and Productivity Agency estimated that the ICT workforce would grow by 33,200 (or 7.1 per cent) in the period 2012-2017.72 The ACS, however, feels that this demand will likely not be met by domestic supply and cites a number of factors in reaching its conclusion, including:
…a combination of falling ICT enrolments in both the VET and tertiary sectors compounded by high drop---out amongst those that do enrol. Further, the ACS believes there has been significant long term underinvestment by employers in upskilling and reskilling the existing workforce in relevant ICT competencies.73
The result of this has been a growing reliance on skilled and temporary migration schemes as a key source of ICT worker supply.
To address the issues confronting business in relation to productivity and workforce participation, the ACS made the following specific recommendation:
2. To assist with workforce planning, research be commissioned which seeks to identify the skills the South Australian economy is likely to need in the next 5-
69. (Australian Computer Society, 2014, p. 10) 70. (Australian Computer Society, 2014, p. 4) 71. Australia's Digital Pulse State Tables, Document prepared by Deloitte Access Economics for the Australian Computer Society, and kindly provided to the Committee. 72. (Australian Workforce and Productivity Agency, 2013, p. 47) 73. (Australian Computer Society, 2014, p. 10)
Page | 33 Economic and Finance Committee 10 years. The project, to be undertaken as a joint initiative of Government, industry, the education sector, community groups and relevant professional societies, would involve three key elements: a. Identifying plausible trends and scenarios for employment in the State in light of accelerating advancement of digital technologies; b. Identifying the types of jobs at risk, the types of jobs likely to become more important, what new jobs will be created, and impacts on demographic sector in the State; and c. Identifying and proposing transition pathways for industry, government and community sectors to achieve better outcomes.74
74. (Australian Computer Society, 2014, p. 5)
Page | 34 Economic and Finance Committee Chapter 7
How the delivery of the NBN can contribute to South Australia’s delivery of government services and programs including health, education and training.
Education and Training
During its testimony before the Committee, the ACS was asked about other jurisdictions that were ‘ahead of the eight ball, because the technology is changing so fast?’ and responded:
The UK is a really good example at the moment. Last year, for instance, they introduced into their schooling system mandatory computer coding to schools from kindergarten. … That is a massive step forward and a recognition of the importance of having these skills in our economy. … The other part of it, of course, is that it's one thing to introduce mandatory digital technology into the school system, but you then need to have the teachers who can deliver the teaching.75
The follow up question concerned the need for ‘constant retraining’ of teachers, which led to the following response:
That's the thing, and that is one of the things that the Society is very conscious of, and we actually have an IT Educators Board for that reason, because we recognise there is that requirement to keep going and continue to upgrade your own skills as a teacher or educator. The other thing in the Society we have really homed in on is this fact that you have to win the hearts and minds of kids to get them to come into this world and this digital approach as well. That is a really important thing. It is no good waiting until someone is in high school to start having this discussion, so it really is about winning the hearts and minds of small children, as they have done in the UK.76
Recent reports in the South Australian press have highlighted the British approach to incorporating digital technology in its schools’ curriculum.77,78
The ACS was also asked about the need for getting students interested in the new technology at an early age:
That's dead right. So, yes, it's much more than just using it. This digital technology curriculum which has been developed by ACARA79, is about how you use this stuff
75. (Commitee Hansard, 2015, p. 83) 76. (Commitee Hansard, 2015, p. 83) 77. (Advertiser, 2015, p. 22) 78. (BBC News Online, 2015) 79. A copy of this curriculum was provided to the Committee, and can be found in Appendix 10.
Page | 35 Economic and Finance Committee to actually produce solutions, platforms and applications. … I actually think there is a sort of whole marketing problem with IT in schools. … Things like Code Club80 are trying to address that. … With kids, it's about getting them to recognise that the technology is for fun as well as for gain.81
To the question ‘Are you in the process of having discussions with the Federal Government about the importance of this foundation training block?’ the ACS witness responded:
Yes… That's where I sort of started in the process. I am actually seeing, to be honest, a real tipping point around this in the last nine to 12 months. So, at a federal government level, I think there is now a broad recognition in there that this is really important and we need to start moving to introduce digital technologies in schools. I am seeing it in a lot of state governments, but I am also seeing it from a lot of the really big employer groups.
The best example I can think of is that the Business Council of Australia are now recommending that digital technology in schools be mandatory.82
When asked ‘Do you have any other suggestions as to how we can engage more kids in STEM subjects?’ the ACS replied:
You are right, Engineers Australia is doing stuff, the CSIRO is doing things, the Office of the Chief Scientist is doing things, Code Club. …I think one of the things we need to do better… is we need to be collaborating a bit better across those groups. I think we're getting a lot of inefficiencies with multiple organisations trying to get into schools and essentially do the same thing…
[There is] a group called Digital Careers, which we're part of, which was funded by the previous commonwealth government. Essentially, they are trying to promote digital careers in schools… And you have got Google and Microsoft doing stuff as well. So there's a lot of activity, it's all very busy, but I think we need to collaborate a bit more.83
In its testimony, the Office for Digital Government made reference to some collaborations:
…we have been working with the Australian Computer Society and the AIIA in terms of what is called SFIA (Skills for the Information Age84)… Increasingly, though, there is the connection with schools and the education sector to work with DECD and
80. Code Club Australia is a nationwide network of free, volunteer-led, after-school coding clubs for children aged 9-11. For more information, see: (Code Club Australia, 2015) 81. (Commitee Hansard, 2015, p. 84) 82. (Commitee Hansard, 2015, p. 84) 83. (Commitee Hansard, 2015, pp. 85-86) 84. SFIA is a common framework which allows an international understanding of what an ICT role actually involves and identifies the skills required. For more information, see: (Australian Computer Society, 2015)
Page | 36 Economic and Finance Committee places and agencies like that so that the curriculum reflects the skills for the information age in the way we are doing.85
In his testimony before the Committee, Mr Paul Billows, Principal of Port Augusta Secondary School, was engaged in the following exchange which highlighted the issues currently faced by his and by extension, other remote schools.
One of our biggest limitations is that if more than about two classes out of that group, so more than about 60 kids, are trying to do something on the internet everything slows to a screaming halt. We've got one external connection to the internet that the students have got access to.
How many students in this school?
About 585 at the moment.
So, 60 out of 580 is not a very high percentage for your internet?
No, it's not, and it has other implications too because we're very heavily into numeracy and literacy work and other things and we test our kids every six months using ACER (Australian Council for Educational Research) literacy and numeracy tests …
So, NAPLAN is due to come online, online testing, in 2017?
That's not going to work.
No, not at the moment. That would be a problem for us, unless we downloaded it all first, I guess, onto our intranet and then they do it from there.
So, if NAPLAN was hosted here rather than hosted out in the wide world it wouldn't be a problem. The infrastructure, we put very deliberate focus on infrastructure spending when we moved into this campus. Basically, we're unlikely to need to upgrade the back end of our system here in terms of communications for another 10 years.
So, how many year 9s would you have?
Just over 100, 110.
Okay. So, it's just not going to work?
No. We'd have to work something else out. It's hard enough at the best of times getting all the year 9s doing the NAPLAN, never mind about systems dropping out and all that.
And SACE want to do examinations online as well?
Yes, that's right; yes, exactly…86
85. (Commitee Hansard, 2015, pp. 106-107) 86. (Commitee Hansard, 2015, pp. 69-70)
Page | 37 Economic and Finance Committee In its testimony before the Committee, TAFE SA was asked ‘Then through the common purpose group, which should maximise the benefits throughout the region, TAFE could play a critical role in being a service provider for that up-skilling component that is required from business or the broader community?’ and provided the following response:
Absolutely. That's definitely what is happening with those discussions. We are trying to position TAFE at the core of that education hub.87
And the following exchange:
Could this be an area where the council and TAFE could work together to try to improve the digital literacy of the community before the NBN comes in, using existing resources without necessarily needing a grant?
I think so, but as was discussed a little earlier, we are pretty stressed in terms of resources at the moment, in terms of what we've got on our campuses. They are fully utilised because our TAFEs are full at the moment, which hasn't always been the case in the last 18 months. …
How widespread are the IT courses within your region? Are they sort of only at big centres like Port Augusta or do all TAFEs have some sort of degree of IT skills?
I would say they all have the capability for some degree of IT skills. We certainly deliver in Roxby Downs. We deliver in Port Pirie, Port Augusta, Whyalla, obviously, but we can deliver in Cleve on demand as well. But we can't sit around and wait for demand like you are alluding to. I think we need to be proactive in changing our approach to how we get some bums on seats.
Has TAFE been looking at, as towns become connected to the NBN and you get faster internet, whether there is the opportunity for remote learning, that is, for people in the country to participate in a course that they otherwise would have to move to Adelaide to partake in?
Exactly; and that's definitely happening as we speak.
We've got 44 online courses already—purely online—through a range of subjects, and they want to get more and more, but of course they are hampered by capacity. So, it's exactly what Robin is saying: it saves the remote communities going to Adelaide to do even just a unit of the course even if they've got to do certain sections; so it's all a big save for business and the industry as well.88
When asked to expand on the concept of ‘pop-up campuses’, the following exchange took place:
There is a strategy to move away a bit from physical locations and tying people to come to a campus. So, we might, I guess, to a degree like to run a course at, say, Yunta, so it becomes a pop-up campus.
87. (Commitee Hansard, 2015, p. 51) 88. (Commitee Hansard, 2015, pp. 48-49)
Page | 38 Economic and Finance Committee So people meet in a boardroom or community centre?
Yes, we just get a footy club room, or school, or somewhere we don't actually have a current physical location.
A shearing shed is a good example for pop-up classrooms. …
And, obviously, having a high-speed broadband makes that work properly?
Yes; probably not at Yunta, but there are lots of places where we don't have facilities.
But they have to have high-speed broadband for it to work, don't they, rather than just Port Augusta?
Yes, that's right.89
The TAFE SA representatives were asked about the internet speeds they experience across the different sites in its jurisdiction. They subsequently supplied the Committee with the following data:
Port Augusta 10Mbps (Government Broadband) Port Pirie 20Mbps (Government Broadband) Whyalla 10Mbps (Government Broadband) Roxby Downs 4Mbps (Telstra) Coober Pedy 2Mbps (Telstra) Peterborough (DECD site) 1Mbps (Telstra)
In its written submission to the inquiry, the ACS made the following recommendations to address the education and training issue:
1. Changes to the education and training system to help ensure it delivers the necessary supply of skilled ICT professionals as well as high levels of ICT literacy in the workforce. Specifically ACS recommends: a. Including a Digital Technologies subject as a mandatory element of primary and secondary school curriculum; b. VET providers to ensure all courses place a strong focus on base ICT skills and competencies so that in a fast changing, digitally driven world graduates are not left “unqualified” for the jobs of tomorrow; and c. Establishing a Forum of Government, industry, employer and education stakeholders to work up initiatives to help ensure ICT students (tertiary and VET) have greater exposure to work-integrated learning (WIL) through initiatives like internships. This helps graduates (sic) work-readiness by ensuring they have a mix of not only the deeper technical skills but also the critical ‘soft skills’ like project management, problem solving, stakeholder management and strategic and creative thinking.90
89. (Commitee Hansard, 2015, pp. 51-52) 90. (Australian Computer Society, 2014, p. 5)
Page | 39 Economic and Finance Committee In its submission to the Committee, the SA NBN Taskforce indicated how education, training and e- health would benefit significantly from the NBN:
Likewise South Australian government schools and preschools will greatly benefit from the implementation of the NBN by: - enhanced ability to deliver online learning and curriculum - ability to leverage modern internet technologies supporting collaboration between and within schools and other education providers ( e.g. video and voice communications) - centralisation of school administrative support systems allowing resources to be applied to student learning rather than management of administrative systems - assisting to ensure equity of educational opportunities for country and remote students. The NBN will: - enable online and integrated delivery of government services - support new tele-health initiatives such as remote patient diagnosis and monitoring - enable better integration of information and data such as electronic medical records - provide greater training and professional development opportunities through the online video-link environment - support interactive learning opportunities - enable online tutoring and mentoring - enable integrated service delivery and online opportunities to work across levels of government - benefit people with disabilities by providing them with improved quality of life through the ability to access increased levels of internet performance.91
School Visits by the Committee
In addition to hearing official testimony to help in its deliberations, the Committee also made four informal visits to primary and secondary schools. These visits were not recorded in Hansard. These visits consisted of a tour of the facilities of each school, followed by demonstrations of activities conducted by the schools in their digital teaching programs.
At the Aldinga Beach B-7 School the Committee observed a class of students actively engaged in coding through the use of ‘bee bots’92 which allow very young children to be introduced to the principles of coding in a fun and engaging manner.
91. (SA Government National Broadband Network Taskforce, 2014, pp. 8-9) 92. Bee-Bots are an educational device designed to introduce very young children to digital technology. For more information, see: https://www.bee-bot.us/
Page | 40 Economic and Finance Committee At Willunga High School, the Committee observed several presentations by staff and students illustrating how the NBN has enhanced the teaching and learning experiences at the school. The Committee was impressed by the breadth of applications utilised at the school, including:
- NBN at the Willunga High School;93 - the use of Minecraft as an educational tool;94 - near space program.95
Both Aldinga Beach B-7 School and Willunga High School are connected to the NBN, and are making use of the advantages that come with that connection. The Committee also visited two schools at which the NBN is yet to be connected, namely Gawler College B-12 and Fremont-Elizabeth High School. The former of these schools is connected to fibre through the SABRENet network.96 These schools both have active and extensive ICT programs. The Committee was particularly impressed with the efforts of staff and students at the latter school and its ability to conduct an ICT program with equipment that falls well short of being state-of-the-art.
One issue was raised by all the schools visited regarding the firewall software used by the Department of Education and Child Development (DECD). It was reported that the firewall required individual users and schools to request access to certain sites, even when permission to access these sites had been given on previous occasions, and to other schools within the state. This was described, by multiple sources, as frustrating.
The success of Willunga High School was also mentioned in the written submission by the City of Onkaparinga:
The Willunga High School experienced a lifting of grades as high speed broadband internet introduced as part of the NBN and installed by DECD helped turn C-grade students into A-graders. This local school was part of a study '21st Century Teaching Strategies for a Highly Connected World' which looked at changes to the way teachers teach and students learn at schools connected to the NBN.97
93. For a brief overview of the NBN at Willunga High School, see: https://www.haikudeck.com/nbn--whs-education-presentation-e60VdUlmXS# 94. For a brief presentation on the use of Minecraft as a teaching tool, see: https://prezi.com/ernevrdc2e0r/introduction/?utm_campaign=share&utm_medium=copy 95. For an overview on the benefits to science teaching, including the Near Space Program, at Willunga High School, see: http://whsinnovation.weebly.com/ 96. The South Australian Broadband Research & Education Network (SABRENet) is a fibre-optic broadband network linking major Research & Education sites in metropolitan Adelaide, South Australia. For more information, see: http://www.sabrenet.edu.au/about/ 97. (City of Onkaparinga, 2015, p. 2)
Page | 41 Economic and Finance Committee Telehealth
In his testimony before the Committee, Assoc Prof David Mills, representing the University of Adelaide, made some general comments about his department (Discipline of Rural Health) and some of the issues it faces:
The university invests pretty heavily in education in the rural sense. We spend about $5 million a year on rural education in rural sites. We've got 10 sites we have students in. I have about 180 students a year and they spend varying times in the sites. They might spend only four weeks here; sometimes they spend a whole year.
…I spend about half a million dollars a year on IT each year, and I have two full-time staff trying to manage the network …I can understand why we have had so many problems is all the copper wires are wearing out and are probably not going to last much longer.
Just recently, we've gone from an ISDN set up - fixed lines into our sites - to a web- based system… One of the things I really struggle with, of course, is the connections. The best we get is one to four megabytes a second, which is really miserable…
The students look up things online, the curriculum is online, and we do a lot of interactive tutorial and sessions… the quality of that is pretty minimal, I have to say, on one to four megabytes a second…
We do a lot of our assessments online now. To save people coming back to the city, we will get them to do really important exams online… The students want interaction. They are bored by sitting in lectures and just listening to people; they actually want to do things…98
Assoc Prof Mills was asked ‘Do you connect into AARNet here in Port Augusta at the moment?’ and a follow up question ‘What does that enable students to do here at Port Augusta?’ which led to the following responses:
We do, yes. I was just looking at our speed this morning and it was 140 megabytes a second here…
What I do is bring all the students here several times a year because I can do all of the stuff that I would like to do otherwise, so that is to do a whole lot of education. I bring a lot of the educators from Adelaide, all of the experts, and we do a whole lot of simulation and we do a whole lot of assessments. I can do all of those things here with a high-speed network, whereas I just can't do them in just about all of the other places. So that's really made Port Augusta an important hub for the University of Adelaide.99
98. (Commitee Hansard, 2015, pp. 37-38) 99. (Commitee Hansard, 2015, p. 40)
Page | 42 Economic and Finance Committee When asked ‘So it's not just important that you get the internet at your University of Adelaide site, but it's important that they get the internet high speed at the GP practices and the hospitals where the students spend most of their time doing the work.’, he replied:
Yes. My students are based in general practice and they do a lot of time in the hospitals. I can't tell you what the speeds are in the hospitals, but I think they're about 100 megabytes a second. On the other hand, they work in the general practices where they're running at this one to four megabytes… It's very hard to be interactive when you've got slow connections and small images, and you get delays.100
When asked ‘Your rural education sites… in your understanding are all those education sites going to be accessing fibre cable?’ Assoc Prof Mills replied:
No, I don't think they are.101
He was then asked about the take-up of telehealth in the regional health system in South Australia and he replied:
Most of the hospitals now use Telehealth… It frees up a lot of time for the visiting specialist… if you can free up time by doing a teleconference for, say, the specialist who is in Adelaide, so post-operatively they can do something, that means they have twice as many appointments the next time they come over and they can see more people.102
When asked whether ‘learning in a non face-to-face way’ would give students ‘an even better capacity and empathy to give non face-to-face consultations’ he explained:
You have basically told me the answer: the answer is yes. The rural doctors have a different set of skills from the city doctors, and they learn a whole lot of different things about remote consultations and management. They have to have a whole lot of extra essential skills as well. The IT thing is just another level on top of that, and we use a lot of education tools remotely anyway.103
This led to the follow up question ‘I guess it makes it even more important that the potential patient has a very high capacity broadband or at least access to somewhere with high capacity broadband so they can receive that consultation?’ and answer:
If nothing else it helps enormously with the sense of professional isolation if you can communicate really easily with your colleagues, which you can. If you look at everyone on the Plains, they are all on their phones looking.104
100. (Commitee Hansard, 2015, p. 41) 101. (Commitee Hansard, 2015, p. 39) 102. (Commitee Hansard, 2015, p. 41) 103. (Commitee Hansard, 2015, p. 41) 104. (Commitee Hansard, 2015, p. 42)
Page | 43 Economic and Finance Committee In discussing latency issues with the satellite service, representatives of Regional Development Australia – Far North (RDA-FN) stated:
That is one of the big ones, and then Telehealth is one of the really big ones. Communities like Oodnadatta and Marree, a high proportion of Aboriginal people, and there are clinics there and they can't access the appropriate levels of medicine and access to medical advice that could be resolved through telemedicine - Roxby probably could do it, but Coober Pedy and Oodnadatta and those sort of places. That would be a great outcome if we could get access to reducing the latency issues; there could be real one-on-one consultation in real time.
My understanding is that the NBN new satellite (I am not sure what it is called) should resolve some of those problems. But the technical advice that we are getting from people who are telling us how a satellite works is that you are never going to get away from some of those latency issues. So, if you're screening somebody and a doctor is looking at someone on a video camera, you would want to be pretty accurate in what you're looking at or diagnosing. If there is a time delay latency issue, you could misdiagnose something.105
The lowest common denominator issue was also raised:
Yes, likewise; and that's the point as such. If you have fast broadband and whatever here in Port Augusta and you are providing that service, it is only as good as the service that is being received on the other end.106
Representing Country Health SA, Ms McRae discussed a home telehealth program being trialled and its benefits both in terms of the actual health care, as well as potentially relieving the burden on the hospital system:
The greatest potential for us in Health is the connectivity that may be available in private homes, because a number of initiatives are being rolled out and trialled in Health that involve patients having the ability to link in to the internet from their home…
And you need, obviously, very good, uninterrupted connectivity for that?
That's right. It will still rely on connectivity being available from the patient's end, whether they link into and sign up for the service, but from a health perspective we see that that's probably the biggest potential in the regional sites, to be able to do that in relation to patients in the home.
That would reduce the cost of providing those health services?
Yes, absolutely, but it's more a patient focused service as well. It is the cost but, also, an ability for patients not to have to come into the hospital. They don't have
105. (Commitee Hansard, 2015, p. 29) 106. (Commitee Hansard, 2015, p. 29)
Page | 44 Economic and Finance Committee to go into the GP rooms and not have to be going to and fro to get that checking. Also, it will, hopefully, avoid the admissions into hospital because those potentially preventable admissions are ones that we focus on a lot, to save the admissions into hospital. If you actually look after a patient before it gets to a stage where they need to be admitted, that is a huge cost benefit to the health service and, also, a benefit to patients and their health.107
This led to a discussion of the connectivity of various remote sites providing the following exchange:
How much is the speed of the connection an issue for doing that?
The speed in the regional hubs is great. The speed in some of the remote locations is questionable, and that's why those bandwidth issues are something that we need to look at.
Are all of your health services in your region connected to optic fibre at the moment?
No.
Not all country hospitals are connected: only the major ones are connected?
Yes, and that's why I said some of them are the copper-based fibre. … Leigh Creek is certainly the biggest issue, because it doesn't matter how much ability we have from Port Augusta to be able to connect, the fact is that they can't connect back.
So in a hospital site like Leigh Creek they have the technology available inside the hospital, but it is just the connection to outside that is the problem.
That's right, the connection to get out of there. The GP there is really passionate about the connectivity issues and what he can and can't do. We are looking at other options at the moment. We're not sure whether NBN will offer an increase in those services at Leigh Creek, but we are looking at alternatives when they have to look at satellite links.
What about in GP clinics? Is it patchy as well in terms of what the connections are like?
In Leigh Creek it is, in the regional sites; not in Port Augusta and Whyalla.108
The City of Onkaparinga, in its written submission to the inquiry, mentioned a home telehealth project:
From February 2013 to June 2014 the 'Telehealth in the Home: Palliative and Aged Care in SA' project evaluated the impact of telehealth in the provision of palliative care, rehabilitation and aged care services in the southern region of Adelaide (Willunga and environs). Funded by the Australian Government, the project was
107. (Commitee Hansard, 2015, pp. 53-54) 108. (Commitee Hansard, 2015, pp. 54-55)
Page | 45 Economic and Finance Committee delivered in collaboration between Flinders University, SA Health and the City of Onkaparinga.109
In its written submission to the inquiry, the National E-Health Transition Authority (NEHTA) wrote:
Health is undoubtedly the sector that will benefit most from the delivery of an effective NBN. A widespread implementation of eHealth services, facilitated by the NBN will improve the efficiency of the health sector and generate significant financial savings for all levels of government, as well as savings and quality of life improvements for all Australians.110
It continued to describe some of the ways these benefits may be realised in practice:
- Early intervention for patients in rural and remote areas can help to avoid costly hospital stays and more expensive treatment if the condition is left untreated. - Trauma patients admitted to emergency departments of rural, remote and regional hospitals can receive appropriate intervention in the 'golden hour' following their injury, reducing further costs. - Better targeted evacuations of patients needing care in major hospitals reduces the costs of caring for those patients, especially if they require special care during evacuations (e.g. ICU patients). - The cost of visiting major centres for outpatients and their families can be reduced or avoided completely.111
Its submission also pointed out that:
NEHTA has been working with South Australia since 2005 to enhance the State's eHealth capabilities. As a result of this work South Australia now boasts: - 8 facilities in SA Health including most of the metropolitan facilities are sending about 200 discharge summaries per week to the eHealth Record System; - 72% of general practices, 19% of community pharmacies, and 2 hospitals are registered with the Healthcare Identifiers Service; - The Individual Healthcare Identifier match rate at the time of individuals' admission to healthcare services using Medicare number for the first IHI search routine, is 90% (the second highest rate among jurisdictions); - There are 185,135 people in SA (11% of the SA population) registered with a PCEHR, including 21,172 in the 0-4 age group; - More than 6% of total Shared Health Summaries created and submitted to the national eHealth system are from SA.112
109. (City of Onkaparinga, 2015, p. 2) 110. (National e-Health Transition Authority, 2015, p. 1) 111. (National e-Health Transition Authority, 2015, p. 2) 112. (National e-Health Transition Authority, 2015, p. 3)
Page | 46 Economic and Finance Committee Chapter 8
What policy, program and other enablers will need to be in place to maximize these benefits for South Australia?
In its submission to the inquiry, the SA NBN Taskforce listed the programs and initiatives the state government has established, including:
- the Skills For All vocational and education program; - the eBizSA program; - ForwardIT; - a memorandum of understanding has been signed with Adelaide City Council and Cisco Australia to develop an Internet of Things (IoT) Innovation Hub.
Other initiatives under consideration include: - digitally enabled hubs for virtual facilities; - digital training for SMEs; - introduction of intelligent systems and technologies into the state’s health, education, transport, planning, electricity and water sectors.113
The ACS, in its written submission, made the following specific recommendations:
4. To ensure minimum levels of ICT competence and professionalism and therefore reduce risk of ICT systems failures, the South Australian Government work with the ACS and employer and standards setting bodies on establishing a system for ensuring that senior ICT roles in Government agencies can only be filled by people who meet agreed accreditation standards.
5. The South Australian Government establish a Digital Policy Advisory Council, comprising members from the ICT industry, broader employer groups, the education sector, the community sector and the ACS as the professional society for ICT. The remit of the Council should be to provide advice on the digital readiness of the South Australian economy and make recommendations to Government to help ensure South Australia takes full advantage of the opportunities presented by digital technologies.114
Mr Rowan Ramsey MP outlined the reasoning behind the Commonwealth Government’s reluctance to invest in a public communications campaign:
But, if the network is there, increasingly it will be used. I don't think I would be in favour of a huge government sponsored advertising campaign to try to get people
113. (SA Government National Broadband Network Taskforce, 2014, pp. 10-14) 114. (Australian Computer Society, 2014, pp. 5-6)
Page | 47 Economic and Finance Committee to say that we can go, but I think when we come to actually switching it on, getting those photos, those stories, coming on the front page of the paper…
I think that will be part of the game. If you get too far in front of yourself, once again we will hit this wall of disappointment: 'Oh, you said we were going to do this six months ago or two years ago you said we were going to do this, we are just sick of hearing that.' You really have to wait now until you are ready to flick the switch in many ways and say, 'It's on, get yourself there.’115 and
Once again, that's because the announcement hasn't been made. The NBN board and the minister are not keen to make an announcement about what is going to happen in three years' time because then people start getting excited, or else depressed by the fact that it's such a long time.116
In its written submission, the City of Onkaparinga outlined what it felt were the deficiencies of current government policy:
Smart City, Digital Innovation and Digital Disruption responses seem to be lacking in current State and Federal policies and programs. Whole business delivery models and industry structures are on the verge of change.
The new digital technologies and scientific applications are racing ahead of policy responses (for example Uber and CatchIT booking apps impacting on the heavily regulated Taxi industry).
Libraries and Community Centres will continue to experience strong demand from communities as the digital divide continues to widen between those community members who are able to take advantage of high speed internet connections and those who lack the skills, confidence and discretionary spending to take up the new world opportunities available.117
The City of Victor Harbor indicated that, because grant funding from the Commonwealth Government had dried up, support from the state government was needed:
Grant funding from the Federal Government to enable businesses and communities to take advantage of the NBN has dried up. The NBN is now here and we know what we need to do. We need support to be able to deliver awareness programs locally to stimulate business investment, and upskilling of our local businesses such that they can use the NBN to create competitive advantage, access new markets, grow their current market share, reduce the cost of doing business, provide a better customer experience and demonstrate leadership in the Digital Economy.118
115. (Commitee Hansard, 2015, p. 97) 116. (Commitee Hansard, 2015, pp. 99-100) 117. (City of Onkaparinga, 2015, p. 3) 118. (City of Victor Harbor, 2015, p. 2)
Page | 48 Economic and Finance Committee During its hearing in Willunga the Committee heard numerous testimonials on the need for education campaigns for both the general public and local business groups, but that this funding, while being readily available in the past, had more recently dried up. The City of Victor Harbor indicated that the availability of funding and the actual rollout did not often coincide:
As far as what policy, program and other enablers we need from the state government, the grant funding from the federal government to enable businesses and communities to take advantage of the NBN has dried up. It is not there anymore. The NBN is here now; it wasn't here when that funding was available, but it is here now and is getting connected in the next month. We know what we need to do, but what we need is support to be able to let people know that the NBN is here and what it means for them.119
The City of Onkaparinga outlined the benefits it experienced from government funding:
In about 2008 we secured state government money through DTED (at the time), and we had an online entrepreneurship program that we ran for two years, up to about 2010… We then secured some additional money in 2010, again from the state government, because by then we had a bit of an idea that Willunga was going to be one of the first towns to be chosen by the feds. We worked in depth with 12 businesses on the premise that the NBN was coming in about a year's time, what does it mean for your business? So we got 12 very good case studies here in Willunga. It was actually that Willunga program, which was state government funded, that got Canberra's attention for the digital enterprise program. … We had three years' funding and we put through about 320 businesses.
It's hugely valuable: 300 businesses really reinvented themselves, looked at different business models, and looked at running their businesses cheaper. We really concentrated on the marketing element. How can you market your business differently? How can you expand new markets overseas? How can you work with better relationships with your own customers? 120
When asked how councils are managing the knowledge and up-skilling of residents, Alexandrina Council highlighted, again, the need for adequate resourcing:
We are finding anecdotally, and with some survey results, that the older generation is actually grasping this technology much better than we anticipated they would, but we don't have resources on the ground to be able to run effective programs for education; we just don't have that… We don't have the resources for specifically targeting technology awareness with the residential population.121
Also, during its Willunga hearing, the Committee heard testimony on the pitfalls that can be encountered when local governments implement technological change without proper consultation
119. (Commitee Hansard, 2015, p. 112) 120. (Commitee Hansard, 2015, p. 115) 121. (Commitee Hansard, 2015, p. 117)
Page | 49 Economic and Finance Committee of neighbouring councils. In regard to the purchase and installation of videoconferencing equipment, Mr Shackleford, representing Alexandrina Council, stated:
I can give you the example of videoconferencing: it's going to be a game-changer for many people in regional Australia in all sorts of ways in improving their communication. But just if you look at the role of videoconferencing in local government, we've all got access to the same funding federally, but for as many local government bodies that get hold of the funding, that's how many different kinds of solutions you can end up with.
Just the example of Victor Harbor and Alexandrina—we worked together on the same kind of project, but we've gone down quite different paths with the technology and for various reasons.122
This led to the following exchange:
I think that's really interesting and very worrying at the same time in terms of people are going off spending this money on videoconferencing, it's all quite expensive and then they can't talk to anybody. In your council who can you actually connect to with the videoconferencing equipment you've got?
At the moment we have a connection with Victor Harbor. That's working, we've got that up and running—
That's the only one that works so far.
We are able to connect with Salisbury…
Can you connect with Onkaparinga?
I don't think we have yet. We adopted a platform which we believed was fairly ubiquitous across state government (that's the Cisco platform) and not every other council is looking at that platform…123
122. (Commitee Hansard, 2015, p. 122) 123. (Commitee Hansard, 2015, p. 122)
Page | 50 Economic and Finance Committee Chapter 9
The impact on South Australia following changes to the structure and schedule of the Commonwealth Government’s NBN program, particularly ceasing the rollout of fibre-to-the-premises.
The 2013 federal election brought about not only a change of government but also a change in the philosophy underpinning the NBN. The principally FTTP-based network favoured by the ALP was replaced by the principally FTTN-based network favoured by the Coalition. The differing technologies used for the final connections between the node and the home has given this new network its commonly used title of the MTM model. The decision to make this change was bolstered by several reviews commissioned by the newly elected government and its Minister for Communications, as outlined in the Background section (Chapter 1) of this report.
The Multi-Technology Mix Model
During its testimony before the Committee, NBN Co was asked to outline the various elements that make up the MTM model and responded:
NBN has always been a multi-technology mix project in a sense because it's always been about delivering broadband through a range of different means.
…we've always been going to use satellite. There is a roughly $2 billion program that, I've got to say, I think is probably the most exciting part of this project to deliver high-speed broadband to people in very remote areas.
Fixed wireless has long been a part of the program, to ensure that we can provide a service to people who live in a hinterland. …in fact, there are areas where we have readjusted to create fixed wireless areas where people would prefer it.
We now have the opportunity to use fibre to a distribution point within a community and then to use networks that operate from there, and in communities in residential areas that would mean our going to a distribution point or a cabinet and then running the existing copper network to people's homes and businesses.
We use internal networks, so that we do not have to go through buildings and wire every single apartment or have to drill holes through fire walls and those sorts of things, where that works. In other places, we will continue with fibre all the way through where it makes sense, particularly in new developments and in areas where it is cost effective to do so, and then we will continue with an approach that is ultimately about ensuring we get that 25 megabits per second base.124
124. (Commitee Hansard, 2015, p. 187)
Page | 51 Economic and Finance Committee When asked whether ‘this more pronounced move into multi-technology reduced the cost of rollout and the time of giving that 25 megabit standard to households?’, NBN Co replied:
...so fibre to the node by its nature is quicker to roll out because it does not involve going into people's properties, that is obvious. In terms of cost, obviously we have a budget. The budget is not set by me, it is set by the government, so we work within that. …we have been given a timeline which is 2020, so these tools will allow us to get there.125 and
Yes, hybrid fibre coax which is the HFC, which is the stuff that people get Foxtel and all those sorts of things on. To take that to a new level, we can now do that, so that's great. For South Australia that is great because Adelaide has a large HFC footprint too. …without HFC and the FTTN, it would take us significantly longer to roll this out so I think the public is quite happy with 2020, and wants us to get to it as quickly as we can.126
Similarly, when asked ‘Could you give us an overview of your views on the current Federal Government's mixed technology model and how that is going?’ Prof Robin Eckermann responded:
It certainly has some challenges, but it is really a spectrum of possibilities. If you compare the original plan with the current one, firstly, all new developments will get fibre, and that is estimated to be about 22 per cent of the market by the time the rollout is complete. At the other end of the spectrum, multidwelling units will all get fibre to the building and will then use the existing copper wiring for the tens or hundreds of metres from, typically, a basement location to the living unit. That will deliver anything up to 100 megabits over copper. So people in those areas will not be disadvantaged.
In between there are about 3 million homes that will get an upgrade of the hybrid fibre coax network. I know there is some hybrid fibre coax (or pay TV) infrastructure in South Australia, but I do not know the extent of it, so I expect that some parts of South Australia will have the NBN delivered over HFC… So that is a relatively easy category for a quick fix and a quick boost in performance.
The other relatively easy category of quick fix is where, for about the past 15 years or so, Telstra has built all new estates with a fibre to the node topology. So it has taken fibre out to a little kerbside cabinet and from that cabinet it has run copper a relatively short distance to the customer's premises. That infrastructure has not been driven at its potential and simply putting VDSL2 technology in, which is the latest for driving copper, people in those situations should see their performance lifted to between 25 and 50 megabits, depending on how close they are to the node.
125. (Commitee Hansard, 2015, p. 188) 126. (Commitee Hansard, 2015, p. 188)
Page | 52 Economic and Finance Committee That can be done by, again, simply refurbishing the electronics with no major recabling.
I am informed that there are about 1.2 million homes across Australia in that bucket. So if we take the 22 per cent fibre, the roughly 15 per cent that are in multidwelling units, the 3 million homes that will get quite a good service out of HFC and the 1.2 million homes that are already engineered for fibre to the node, what you are left with is something like 40 per cent of the market in the middle, where the Coalition's plan is to refurbish the copper and change it from a fibre to the exchange configuration and to push fibre deeper in kerbside nodes and change it to a fibre to the node topology.
I think there will be lots of challenges exposed as that work proceeds. In some cases it will be easy, the copper will be in good condition, and the ducts will be relatively open. At the other end of the spectrum, in some cases it will be extremely difficult, and it would be foolish to try to do it rather than rebuild the fibre from the outset. Unfortunately, where the split lies probably won't be known until they embark upon the process.127
On this point of the final makeup of the MTM rollout, the NBN Co Corporate Plan 2014-2017 provides an estimate of the possible final proportions of the individual technologies after completion of the NBN rollout.128
The NBN Co representatives were asked ‘How does NBN Co decide what gets fibre to the node or to the premises versus what gets fixed wireless or what is going to rely on satellite? Have you worked that out for everywhere and it's just a matter of when you roll it out, or do you only make that decision when it comes to deciding for that local area?’, to which they replied:
Obviously, we have a team of planners and designers who are working away right now on finalising all those arrangements…
Fibre to the node and fibre to the basement will be our principal means of rolling out in most of the communities outside the metropolitan area. In the metropolitan area, we also have an additional means… and that's HFC… We can now deliver incredible speeds across HFC, and we will be one of the first countries in the world to use this new technology. It's called DOCSIS 3.1. That will mean that we will make decisions based on what is the quickest, most cost-effective way to deliver high- speed broadband. In larger centres, you would expect that to be FTTN. In some cases, FTTP rollout may still occur for various reasons. It might be cost effective; it might be the most appropriate way. As you know, in new developments, we continue to roll out fibre all the way through because there is no existing other network there.129
127. (Commitee Hansard, 2015, p. 219) 128. (NBN Co, 2014(2), p. 13) 129. (Commitee Hansard, 2015, pp. 185-186)
Page | 53 Economic and Finance Committee In response to a question concerning forward planning and the allocation of specific technologies to towns and cities, NBN Co responded:
Given that 2020 is not that far away, from a planning sense, within our organisation, I would be pretty surprised if we didn't have a firm plan on all communities. I know we have on a large number of them, so we would be pretty close to having all of that locked down, but that doesn't mean there won't be tweaks and changes.130 and
…we don't want to tell people what we're going to do until we know we're absolutely going to do it, and that's not in any way about not being transparent. It's just that there are a whole range of different considerations here around how a particular community fits into the transit network or whether or not we're completely sure that that infrastructure we think is in that town is absolutely there.131
Prof Eckermann made several points about the satellite component of the MTM rollout:
…there will be at least a 12-month transition time to move people off the old satellites. The satellites, I'm sure you're acutely aware of some of the problems people have reported on the interim satellite service, with heavy shaping of traffic and performance problems. Looking ahead, it's foreseeable that the same pressures will come on the long-term satellite about five years down the track, given current growth rates.
I think the only solution therefore, the only effective solution, is to progressively reduce the number of people dependent on satellite and that means providing an alternative, whether it be better mobile coverage or shifting the fixed wireless boundary or pushing out fibre to the node or fibre to the home into more areas. So, having some big picture plan of just how that will all unfold over the next decade, which is probably what's involved in the NBN rollout, I think would be tremendously helpful.132
This led to the follow up question ‘Are you saying that it's your assessment that the service available from the satellites will be essentially at capacity approximately five years after they are in the air?’ to which was replied:
Yes. There are two issues with satellite. One is latency… The other issue is that the total capacity on the interim satellite service is about four gigabits per second, and on the new satellites it jumps to 134 gigabits per second. However, on the interim
130. (Commitee Hansard, 2015, p. 186) 131. (Commitee Hansard, 2015, pp. 186-187) 132. (Commitee Hansard, 2015, p. 217)
Page | 54 Economic and Finance Committee satellite you currently have 48,000 users and they are really struggling with the fair use policies and constraints that are being imposed on them…
So there is a very significant pressure on the interim satellite service and the new satellite service, although it jumps from four to 134 gigabits, also jumps from the 48,000 users to an expected 240,000 users.
So there will be an increase but if you project ahead Internet traffic growth rates over a few years, you soon reach a point of the order of five or six years where the pressure on the long-term satellite will be very similar to the pressure that has been felt on the interim satellite today.133
FTTP versus FTTN
The change from a principally FTTP-based network to a principally FTTN-based network was addressed in several of the written submissions received by the Committee. For example, Mr Michael Zerman noted that:
The current Government's NBN plan continues (with modification for efficiencies) the existing contracts for delivery of fibre to the premises (FTTP) and states that all future greenfields developments will be serviced by fibre to the premises.134
He went on to endorse the findings of the Vertigan cost-benefit analysis and believes that ‘“sooner” is much more economically valuable than “later and maybe faster”’ and finished his submission by urging the Committee to ‘…recognise the worth of this investment rather than being bogged down in technical arguments...’135
Mr David Kalleske, Rockford Wines, related some difficulties he was experiencing with his internet services:
I had a conversation with Telstra Business on 29th October 2014 as we were experiencing extremely slow internet performance. After some investigation and testing I was informed by the gentleman assisting me that he was surprised we had any speed given the low level of our connection (approximately 3Mbps). It was stated that we could not expect any better performance that we currently receive, due to our distance from the exchange - approximately 5 kilometres.
I urge the South Australian Government to ensure any changes to the NBN do not have a negative impact on business that would result in our ability to conduct efficient, reliable and competitive business being diminished.136
133. (Commitee Hansard, 2015, pp. 217-218) 134. (Mr M. Zerman, 2014, p. 2) 135. (Mr M. Zerman, 2014, pp. 3-4) 136. (Rockford Wines, 2014, pp. 1-2)
Page | 55 Economic and Finance Committee In its submission, Business SA endorsed the change to the MTM model:
Business SA is satisfied, as shown through the independent Cost Benefit Analysis of the NBN, that the multi-technology will deliver even greater benefits than the previously devised Fibre to the Premises (FTTP) rollout of the NBN. Greater benefits are able to be delivered through the roll-out of a multi-technology NBN as the service can be completed faster and also requires less upfront investment.137
The South Australian NBN Taskforce endorsed the switch to the MTM model and went on to state the government’s position regarding the deployment of the NBN, identifying a specific concern:
The Multi Technology Mix (MTM) approach by NBN Co instead of the deployment of fibre-to-the-premises (FTTP) to some 93% of all homes and businesses will mean that homes, businesses and communities will receive faster broadband sooner and more affordably. This is a favourable outcome.
…It remains the South Australian Government’s desire to maximise the extent of the most capable and affordable technology type possible to as many South Australian households and businesses, or where clear productivity or social benefits exist for example in remote indigenous communities such as the APY Lands. The use of NBN satellite should be reserved for very remote locations where no other viable options exist.138
In its submission to the Committee, the City of Onkaparinga stated:
The previous NBN structure (providing high speed 100Mbs to every premises) was never going to be delivered within the timeframe schedule or the budget allocated, so the new NBN structure (providing an adequate speed 25Mbs) using mixed technology (which does include FTTP) will get to every premises a lot faster and cheaper.139
In his evidence before the Committee, Mr Rowan Ramsey MP stated:
As far as defending fibre to the node technology as against fibre to the premises, it is highly unlikely - 50 Mbps is an enormous speed and these are speeds that people can't even imagine at the moment. In fact, the minister makes the point that, when a lot of the new technology is switched on, in places where people have ADSL 2, for all intents and purposes, they won't notice the difference… Unless you happen to be a large business operating multiple outlets, 50 Mbps is likely to be more than enough.140
Prof Robin Eckermann provided a detailed submission to the Committee in which he discussed the competing FTTP and FTTN networks. He stated that, in principle:
137. (Business SA, 2014, p. 4) 138. (SA Government National Broadband Network Taskforce, 2014, p. 17) 139. (City of Onkaparinga, 2015, p. 3) 140. (Commitee Hansard, 2015, p. 95)
Page | 56 Economic and Finance Committee In this regard, let me state again that FTTP represents the current ultimate in bandwidth future proofing. Once the fibre is in place, last-mile speed upgrades can be accomplished simply by configuration changes or (at most) by upgrading electronics. This is why the most widespread possible FTTP is the right end-goal for Australia's telecommunications infrastructure.
However, a "spare no expenses, waste no time" approach to getting to this point will not necessarily unlock commensurate benefits in the short and medium term.141
He also stated that:
When practical factors are taken into consideration, the gap between Labor and Coalition approaches closes somewhat.142
The Seal the CAN Project
The Committee received testimony from Arid Land Communications listing concerns it has over the condition of the existing copper network. These concerns have arisen as a result of a program run by Telstra called Seal the CAN. The witnesses described the program and its potential ramifications to the NBN network:
Some 20 years ago Telstra embarked on a project called Seal the CAN. CAN stood for Customer Access Network. It is effectively the distribution cables that go from the exchange to cross-connection points in the street.
Those trunk cables are in very good condition. They are heavily armoured. They have gas protection to keep moisture out, etc. They're in very good condition. The distribution network out from there is in a very bad condition and it is caused by a mistake that was made sealing the CAN. They effectively introduced a rubberised gel to seal joints in every pit in Australia and a few years later they discovered that the gel actually destroys the insulation in the wiring. It eats it away. This has not been made public.
The other thing it does is travels back inside the sheath of the cable for a couple of metres and destroys the insulation inside the sheath and you can't do anything about fixing that. There is nothing you can do to fix it. Then when they found that out, there was a very urgent project to remove the gel from the network but the damage was already done. Effectively, the cable is a time bomb waiting to go off and, apart from the very good protected trunk cables, the copper network is effectively scrap, so it would have had to have massive and expensive repairs done anyway to keep it going if we didn't do the NBN project.
…Optical fibre cable is another 100-year solution if it is installed and maintained correctly and, for those on optical fibre to the premises, bandwidth is effectively
141. (Prof R. Eckermann, 2014, p. 6) 142. (Prof R. Eckermann, 2014, p. 1)
Page | 57 Economic and Finance Committee unlimited. The people who have optical fibre to the node, they're using existing copper, will be limited by the copper. Eventually, everyone else on the fibre to the node system using the copper distribution cable will have to go onto fibre to the premises as this copper is the damaged part of the system. Don't imagine for a minute that any part of the copper network will be workable in 20 years. It just won't, and if it's neglected, it will go further and much quicker.143
In response to a question about the cost of just replacing the copper network:
I think what you are asking is: would it be more cost-effective to actually put fibre in the ground than to replace the existing copper network? In my opinion, it would be a lot more efficient to put the fibre in the ground… Fibre is considerably cheaper than copper - massively, massively cheaper…
The other issue too is that, if you do fibre to the node and then use the existing copper, you have to install devices called DSLAMs. The DSLAMs are what convert the NBN to ADSL to go into the premises. The problem with that is that, if later on you decide that the copper is stuffed and you have to do something about it, you are going to have to pull all of the DSLAMs out and provide fibre anyway, so you have a double expense. It's better to do it all in one go and get it done properly.144
When asked ‘How much life do you think that existing copper to the premises has left in it?’ the witnesses replied:
I think that would depend on the region, the location and how old it is, obviously. Some of it's virtually unusable now.
Once again, I guess I am going back to my days working for the telephone company …but there were a lot of band aid solutions being put in place. I left 10 years ago, or more than that now, and we were doing band aid solutions then to fix it, to make it work, to keep it going, just to keep it running. I don't believe a lot of it has been replaced or repaired since that date. So, in some areas, it's virtually unusable now.145
The witnesses were asked to expand upon the concept of a ‘band aid solution’:
Cutting the damaged sheath off to get to the damaged cable, and leaving it exposed, so the next time it rains you've got more problems.
Yes, certainly that was an issue - the decrepit and rotten joints. A joint is obviously something where two cables underground are joined together and then sealed off to prevent moisture getting in. We would have to cut below that joint, pull out all
143. (Commitee Hansard, 2015, p. 36) 144. (Commitee Hansard, 2015, pp. 37-38) 145. (Commitee Hansard, 2015, p. 38)
Page | 58 Economic and Finance Committee the cabling from the sheath, do a temporary joint underground, wrap it in a plastic bag and put it back in the water.146
The witnesses highlighted the problems encountered by the state of the copper, coupled with the band aid solutions, when adverse weather conditions prevailed:
Everywhere. Port Augusta isn't too bad. It's a very dry place. When it rains, then we find the faults because, if you've got cracks in cables and joints, water is the big killer. When water gets into joints, electricity and copper, it just corrodes away, and you get noise and then you get nothing.
We had a situation with the Laura hospital thing going for probably four or five years. … It was a similar thing at the Orroroo hospital. Every time it rained, their phone lines would go off the air. At Orroroo hospital, people installing optical fibre cable flooded the pits and joints to push the fibre through. It works better when you float it through, you put the phone lines off the air. You report it and they come out and they fix it, and they report it again and they fix it and they report it again.147
These accounts are corroborated by other sources148,149 and the Seal the CAN program featured in a Senate Committee Report in 2004.150 These reports are strikingly similar to the accounts presented to the Committee, with several excerpts being particularly relevant:
The plastic bag fix is such that technicians routinely refer to the Telstra network as Baghdad. Tim Ashford, a highly-qualified, Telstra-accredited engineer who recently retired having started in the industry in 1961, tells a tale that has come to sound very familiar over recent years, "Contractors go in there and get paid by the job, so they just want to be in and out. It takes time to do records and to seal the joint properly so they don't do it."
Thousands of people are having their phones cut off every time it rains because cost-cutting by Telstra means the lines are no longer waterproof and sometimes protected only by children's lunch bags...
In many cases technicians, overloaded with the 500 per cent increase in workload, are forced to do hasty patch-up jobs with tape and plastic bags. They then put in a request for an outside contractor to complete the job but often this is not done in time, leaving the lines exposed to water...148
146. (Commitee Hansard, 2015, p. 38) 147. (Commitee Hansard, 2015, p. 39) 148. (ABC Online, 2013) 149. (ABC Online, 2013(2)) 150. (Environment, Communications, Information Technology and the Arts References Committee, 2004, pp. 76-79)
Page | 59 Economic and Finance Committee Witness Responses Concerning the Copper Network
The issues raised by the Arid Land Communications testimony were put to other witnesses who subsequently appeared before the Committee. In response to questions about problems with the copper cabling and the potential lifespan of that copper cabling, Mr de Brenni, representing the Office for Digital Government, responded:
Yes, we have. It's been quite open that there are issues with copper, at times. We get briefed on what's happening and we also understand that the copper network - the contracts between NBN Co and Telstra require that Telstra upgrade its copper and its ducts to a standard suitable to NBN Co before NBN Co can deploy. Hence, the deployment schedule is something not in our control, it's something that is a matter for NBN Co and Telstra making assets ready and suitable.
What has been said is that the Customer Access Network components, which include copper and conduits, are made ready to a suitable standard before they're handed over to NBN Co from Telstra to NBN Co. So, they would have to abide by service-level agreements and quality standards.151
Mr Rowan Ramsey MP replied:
As far as the issue around sealed CANs, I have heard that, as well. I have only heard it from one person; I suspect it might be the same one … I did bring it to the minister's notice and basically the reply was, 'Well, it's NBN's job to scope this and sort out these problems.' …This is the job of the people who are installing the network to get right. They must be able to identify the problems. If the copper network is unserviceable it will have to be replaced, and we are well aware of that - and it will be replaced in places. To my understanding that has happened in some places around Australia where the copper network wasn't serviceable.152
It depends when 'eventually' is. The minister's view is that there is a lot of life left in the copper network, so we have differing views on that. … the answer is that the network will be built and we will be spending whatever needs to be spent to build it, but we don't want to waste money.153
When asked ‘Are you conscious of the standard of the copper network?’ Mr Jarvis, NBN Co, responded:
Obviously the copper network will vary in different parts of the country and we are working very closely, predominantly with Telstra, to understand all of those things. We have gone into very high-level, sophisticated negotiations with Telstra and we have come up with an agreement where we have access to that network and we
151. (Commitee Hansard, 2015, p. 107) 152. (Commitee Hansard, 2015, p. 98) 153. (Commitee Hansard, 2015, p. 100)
Page | 60 Economic and Finance Committee ultimately take responsibility for it when we take over an area. So, we are obviously taking all of those risks into account when we roll out a business plan.154
To the follow up point raised, ‘Just to give you some idea, we've had evidence that a hospital in the Mid North, for example, every time it rains, its telephone network breaks down, and that's because of coating that was put on the copper networks that is eating the copper away. So, water is getting in and it's eating that away. That's not just an isolated case, so if that network is not upgraded, you can go to the node, but they're still going to have their networks breaking down’, Mr Jarvis replied:
Our job will be, as I said, to deliver a guaranteed service and product, including to that hospital. That's our responsibility and our job to make sure that we provide what we say we are going to provide and, more importantly, what an end user or a customer or a punter or whatever you want to call the person in their homes, we will give them what they paid for, and if we don't, then our partners who are the telcos are not going to be sitting back idly. We've got a responsibility.155
In response to a question about whether ‘those who are critical of the fibre to the node plan are justified in saying that we have compromised the service because it is fibre to the node and not to the home’, Mr Jarvis reiterated NBN Co’s philosophy concerning the MTM technologies:
I never accept that it is a compromise service because, in the end, people will be very clear about what they getting from us, and the things people are doing online will be more than adequately serviced by what we are doing. But in terms of the opportunities to upgrade our network with new technologies that come along, I think any telco that doesn't see that as part of the future shouldn't be in the game.
We are always looking at new technology. Already, with fixed wireless, we are doing some trials around faster speeds again, faster than we ever thought we would do. So yes, there are those things. There are a lot of people who talk about high speeds over copper but, for us, in the end what we are trying to do here is get this service rolled out as quickly as we can in the most cost-effective way. With the VDSL model or the fibre to the node model, we are not proposing to bring some great new technology in to make that happen; we have all the technology, we have all the systems and all the things to do that now, but down the track who knows what will happen.
I think we are always looking. This DOCSIS 3.1 system that we were using as part of our HFC, that wasn't around 12 months ago, so we're grabbing these new things and bringing them in and giving people faster speeds, so maybe some of those options might be things we would look at.156
154. (Commitee Hansard, 2015, p. 189) 155. (Commitee Hansard, 2015, p. 190) 156. (Commitee Hansard, 2015, pp. 190-191)
Page | 61 Economic and Finance Committee Prof Eckermann was asked about the availability of new technology that could potentially overcome some of the ‘dodgier’ sections of copper, and replied:
The technology keeps getting better in terms of throwing processing power at the task of separating signals from noise, and that's the fundamental issue in driving performance of copper. But there are limits to which it can go, and some of the copper would be so degraded that I think it would be folly to invest a huge amount in trying to get performance out of it when you are really looking down the barrel of having to replace it, and if you're going to replace it, you certainly want to look hard at fibre either all the way or as close as possible.
As a guide to copper… the upgrade that TransACT did in Canberra, putting in VDSL2 technology. That is an example of the smarter, later generation technology that drives copper. People in TransACT's network who are lucky to be close to the node are consistently getting 80 megabits out of that copper now and it is a rock-solid 80 megabits.
There are further technology upgrades that will take that - a protocol called G.fast - that will take that up to anywhere from 300 to 500 megabits. So that is the best end of the spectrum. TransACT was new copper deployed only 15 years ago, and it absolutely makes sense in an initiative to upgrade Australia's infrastructure to take pockets like TransACT and drive them to their potential for a fraction of the cost of replacing them. But, at the other end of the spectrum where the copper is poor, you might as well bite the bullet and replace it.157
157. (Commitee Hansard, 2015, p. 220)
Page | 62 Economic and Finance Committee Chapter 10
Other relevant matters.
In its submission to the inquiry, the ACS raised the following issues:
Delivery of Government Services In a high speed, connected online world, Governments can significantly improve their own efficiency and effectiveness…
Environmental Benefits The combination of high speed, ubiquitous broadband and smart use of ICT presents opportunities to reduce the carbon footprint…
More Business Opportunities Whilst high-speed broadband and digital technologies are great disruptors of industries, they also create new opportunities…
Social, Community & Regional Benefits Whilst the online world is often portrayed as contributing to the decay of regions and communities because it promotes remote access to goods and services and reduces the need for face-to-face interactions, it does in other ways generate benefits…158
The SA NBN Taskforce raised the following matters:
Business grade services More information would be appreciated from NBN Co on the timing and types of business grade services and details of what service packages will be available.
Funding The Government of SA notes that the Commonwealth has primary responsibility for telecommunications and for the delivery of the NBN. Notwithstanding the above, Treasury and Finance note that the Commonwealth have previously indicated that co-contributions from State and Local Government will be heavily weighted in funding allocations. For example, in the proposed Mobile Black Spot Programme, it is possible that that a co-contribution from the State Government will provide a means to influence which black spot locations are funded. The State has no approved funding within the forward estimates as a co- contribution towards telecommunications infrastructure by the NBN.159
158. (Australian Computer Society, 2014, pp. 23-25) 159. (SA Government National Broadband Network Taskforce, 2014, p. 16)
Page | 63 Economic and Finance Committee NBN Co Communication Issues
The level of communication between NBN Co and various interested parties was raised in testimony by several witnesses. A common theme was that this communication started off at a very good level but has fallen away in recent times. For example the Port Augusta City Council stated:
Initially when the NBN came, we received a great deal of information and it was really good, but that has backed off, so we will be seeking more information to lead us to the path that we are going on ahead, so we have something we can build on. The information has slowed up and we are waiting for some more to come out but, hopefully, this is what this may do.
No, more so we were almost bombarded with information to start with which was wonderful and then probably the last 12 months that has changed and we are not getting as many visits. We do have contact people we can get in touch with when we need to, but in terms of delivery dates, we are not getting those official dates through at all.160
Representing Business Port Augusta, Mr Versteeg described frustrations encountered by the local NBN working Committee:
…We have had meetings. That's lost a lot of focus over the last probably six to eight months. In fact, recently I had to send three emails to make sure he was still alive - and apparently he is. He came back to us and said that we wouldn't be having more updates until about November. I was trying to organise a training session on behalf of Business Port Augusta for NBN, trying to organise one around June, July, August - something like that - to get the businesses up to speed as to what exactly the implications are for the businesses themselves. That's probably why it has lost a little bit of focus.161
The following exchange also occurred on the subject:
Can I just get a handle on the time frame? He used to attend the working group meetings?
Yes, he hosted them basically.
At what point did he stop attending those?
It probably died off almost just after the election actually. After the election change there was a focus change. He's only been out once since the election, I reckon.
Where is he based? Is he in Adelaide or interstate?
He's in Adelaide.162
160. (Commitee Hansard, 2015, p. 5) 161. (Commitee Hansard, 2015, p. 13) 162. (Commitee Hansard, 2015, p. 19)
Page | 64 Economic and Finance Committee A similar exchange also took place with representatives of RDA-FN:
You mentioned that you have had limited communications from NBN Co.
Yes.
What does 'limited' mean?
I know the gentleman, from doing those particular roadshows, so I just make contact with him and ask, 'What's happening in the region? What's happening in Port Augusta? When is the rollout happening?' I make contact with Cherie here at the council because we're sort of linked with those guys very well but, you know, it's the same stuff—
What do you hear back?
The same thing. We obviously inherit correspondence or we haven't heard much from them so we haven't got much to report.
Do you hear any replies back from NBN Co?
Just the basic information that we can get off the website; nothing new or anything different. No, it's just—
But you have had the same experience as others in that information at first was very forthcoming and there was a lot of information and then it dried up?
Yes. That created, obviously, a lot of hype in the area and the region and whatever but then it died and that's created even more angst around the place.163
Prof Robin Eckermann was of the opinion that better communication from NBN Co about the rollout schedule would allow for the possibility of short-term services being set up in remote areas:
If for example, take my hometown, and I have no idea what its situation was, but if people knew that NBN would only get to Eudunda in five years' time, there is a five- year window there where it may be commercially viable for someone to put some equipment in an exchange and improve DSL services and provide some interim assistance. I would like to think we can encourage NBN Co to not just publish a rolling three-year plan but really a full perspective of its rollout so that people get an idea of what's coming when.164
However, the feedback about communication with NBN Co was not all negative, as this exchange with the Office for Digital Government indicates:
Do you have a comment on the level of information flow that comes through to the premium or peak agency in South Australia in regard to the NBN rollout? You know more than what others might know about what is going on.
163. (Commitee Hansard, 2015, p. 31) 164. (Commitee Hansard, 2015, pp. 216-217)
Page | 65 Economic and Finance Committee The South Australian government has a task force to provide a single and initial point of contact for NBN Co and others, such as this inquiry, on matters regarding the NBN. The NBN Co actually attends some sessions of those meetings, provides updated activity and raises any matters requiring coordination…
It's a satisfactory relationship?
It's a very good relationship, yes. The task force handles many items out of session. Once we have those initial contacts, we have people within NBN Co and people within specific government agencies who handle the matters raised, and they work very well together.165
The Committee expressed its view that the scope of the communication brief was likely too much for one person to handle. Specifically, ‘I guess as a prefix, the impression I get is I think, not that Chris isn't doing a really good job in terms of the community engagement, but that it's probably almost impossible for you, Mr Gregory, to get out to all of these people and places, particularly as the rollout schedule is a lot quicker than probably what it was going to be immediately.’166
Another issue relating to a lack of communication concerned the availability of technical support during the actual installation of the NBN hardware in residents’ homes. As put by the representative from the Willunga Business and Tourism Association:
One of the key issues here was that technical support was not on the ground. As the NBN was being put in the ground and being connected up to houses, there was no technical support and no technical people here who could go in and answer… There needs to be technical support on the ground, number one, for the hardware.167
Unscrupulous Practices
Several witnesses raised an unfortunate consequence of the uncertainty surrounding the rollout. This involved the work practices of unscrupulous individuals. As described by the following exchange involving Business Port Augusta:
Yes, and further on from that, there are guys from outside telecommunications running around town at the moment saying, 'Oh, listen, you'll need to update to this,' and they spend $15,000 to $20,000. …so they spent $15,000 to $20,000 on a new phone system and they didn't need it. That's because there's a lot of misinformation out there and there's not enough information out there, so we want to be the tool to do that to businesses…
It's interesting that, even though the communication from NBN Co as to what's happening or what technology you need isn't necessarily forthcoming, there are a
165. (Commitee Hansard, 2015, p. 107) 166. (Commitee Hansard, 2015, p. 198) 167. (Commitee Hansard, 2015, p. 149)
Page | 66 Economic and Finance Committee lot of companies coming around to businesses and communicating to you, saying, 'You've got to buy our stuff,' and people don't know whether or not—
It's sort of scare tactics. He came and saw me as well, and it's basically just trying to upsell you a phone system that you don't really need yet and probably don't need in the future. …
So, that lack of communication isn't just inconvenient: it's potentially dangerous because businesses might go and buy $15,000 of equipment that won't necessarily work with the NBN or that they don't necessarily need.
Correct, yes.168
The representatives of Arid Land Communications had also encountered this behaviour, and related an example:
…we had an example of a person in Port Pirie only a few months ago. He bought a new phone system from a business systems dealer - a new what is called an IPECS system. It is an IP-based phone system; it is entirely compliant. He got offered everything in one bundled package, and he could not refuse the offer.
Six months later, he had an approach from another dealer in the same company telling him that his system was non-compliant and he would have to replace it. He was pretty upset. We have had people ringing us up at least one a month saying, 'We have had these approaches from people selling the systems.169
Prof Eckermann was asked of his knowledge of this behaviour, as outlined in the following exchange:
We have also heard some evidence of where an area is due to have the rollout take place that some sharks move in, for lack of a better word, and go to businesses and say, 'You need to upgrade your equipment. Here's this $10,000 package of phone line and phone handset equipment that you'll need, otherwise nothing will work with the NBN.' Have you heard anything like that, and, if so, do you think there's anything that can be done to prevent that?
I haven't heard of that, but it doesn't surprise me either. There's a lot of poor understanding about what's actually involved and having connected my mother up, I made a trip over to South Australia to get it all up and running, and it's not something she could have done herself. So, people will feel very, perhaps, intimidated by what they see and they would be vulnerable to, I think, some of those approaches. I think it should be watched fairly carefully and jumped upon if there's evidence it's happening on a significant scale
And that should be NBN Co's responsibility, in your view?
168. (Commitee Hansard, 2015, pp. 17-18) 169. (Commitee Hansard, 2015, p. 43)
Page | 67 Economic and Finance Committee It's difficult to split between wholesale, where NBN Co seeks to be transparent behind the scenes, just providing the connection, and the retail service provider who ultimately kind of owns the customer… I think NBN certainly has a role in better informing the community of the overall rollout plan, what can be expected when, but probably the retail service providers have to step up to the challenge of how to support these connections.
It's technically non-trivial to configure the router and do things like that and that makes it all so expensive for the retail service providers, so they will either tend to want to charge quite a lot for the service or they will tend to want to evade the cost of doing it, leaving their customers potentially struggling to get things to work.170
170. (Commitee Hansard, 2015, p. 217)
Page | 68 Economic and Finance Committee Chapter 11
Recommendations
Recommendation 1
The South Australian Government encourage NBN Co to publish detailed information on the condition of South Australia’s copper network.
NBN Co is currently implementing a MTM-based network with a significant delivery of Fibre-to-the- node (FTTN). FTTN will be entirely dependent on the existing copper infrastructure for the final connection to the premises.
The Committee received testimony from witnesses with hands on experience of the copper network that the condition of this network in some parts of South Australia is in a highly degraded state of repair and that ‘the copper network is effectively scrap, so it would have had to have massive and expensive repairs done anyway to keep it going if we didn't do the NBN project.’ (Chapter 9). These accounts are corroborated by other sources which indicate that the problem is not confined to South Australia, but rather is of concern on a national level. This is allegedly in large part due to Telstra’s former ‘Seal the CAN’ program, that ended up degrading many metropolitan and regional copper connections.
The evidence received by the Committee concerning the state of the copper network was not entirely negative. Prof Eckermann (Chapter 9) discussed methods by which existing copper could be upgraded, including a protocol called G.fast which would allow potential speeds across the copper network of between 300 and 500 Mbps.
The Committee believes that, because the existing copper infrastructure is now necessary for the rollout of the FTTN elements of the network, a proper understanding and acknowledgement of the condition of this network in South Australia is vital. Such an effort should prove useful on several fronts, not the least of which would be a better understanding by the South Australian Government of the quality of connections that will be available for hospitals, schools and local businesses. As put by the Office for Digital Government: ‘the contracts between NBN Co and Telstra require that Telstra upgrade its copper and its ducts to a standard suitable to NBN Co before NBN Co can deploy’ (Chapter 9). The Committee therefore recommends that NBN Co publish the detailed information it has on the existing copper infrastructure for South Australian premises. If such an investigation has not already been conducted, the Committee recommends that it be done as soon as is practicable.
Page | 69 Economic and Finance Committee Recommendation 2
The South Australian Government advocate to the Commonwealth Government that it should continue the rollout of fibre-to-the-premises, rather than fibre-to-the-node, to deliver high quality connections for households, businesses, schools and hospitals in South Australia.
So far in South Australia – the connections that have been made to the NBN have largely been in areas serviced with fibre-to-the premises (FTTP). This has involved the laying of a fibre connection to each premises and subsequent disconnection of the legacy copper network. This positions these suburbs and towns with the potential for very fast internet connections. Significant areas of FTTP connection in South Australia already include Prospect, Seaford, Willunga, Aldinga, and Tea Tree Gully. As part of the MTM, it is now NBN Co’s intention to deploy FTTN to the large majority of metropolitan Adelaide and significant regional centres, as specified in the very recent three year rollout plan published by NBN Co.171 The Adelaide metropolitan area also has substantial pay TV infrastructure, utilising HFC technology which NBN Co plans to incorporate into the coming rollout. The Committee heard evidence that by using DOCSIS integration technology, and by having access to the pre-existing pay TV infrastructure, that HFC represents the quickest and most cost-effective way to deliver high-speed broadband (Chapter 9).
As a follow on from Recommendation 1, releasing information on the state of the copper network will, based on testimony received by the Committee, almost certainly reveal regions where the copper is beyond simple remedial action. The question then arises as to which is the better option: replacement with new copper, or switching to a FTTP connection? The Committee heard testimony that in purely financial terms, a fibre alternative would be more cost-effective. Specifically that ‘fibre is considerably cheaper than copper - massively, massively cheaper’ (Chapter 9) and ‘some of the copper would be so degraded that I think it would be folly to invest a huge amount in trying to get performance out of it when you are really looking down the barrel of having to replace it, and if you're going to replace it, you certainly want to look hard at fibre either all the way or as close as possible’ (Chapter 9).
The reliability of connections is important, particularly for important South Australian Government services such as hospitals, schools and emergency services. A reliance upon degraded copper for these essential services could result in significant disruption to services. The Committee heard testimony that rainfall in the mid-north of South Australia had a recurring, negative effect on the copper service to local communities, with the public hospitals in Laura and Orroroo being singled out for special mention where service interruptions are commonplace (Chapter 9). For hospitals, schools and emergency services the ability to use multiple high-definition video-conferencing connections simultaneously will be increasingly important in coming years and could be hampered by poor quality NBN connections. While a non-fibre connection may suffice for most households, it would
171. While this report was in the final stages of preparation, NBN Co published its detailed three-year rollout plan, dated October 16, 2015. This plan indicated that, in South Australia over that period, the FTTN component of the rollout would encompass some 399,420 premises. The HFC component of the rollout would encompass some 188,500 premises. For more information, see: http://www.nbnco.com.au/content/dam/nbnco2/documents/three-year-construction-plan.pdf
Page | 70 Economic and Finance Committee quickly be overwhelmed by hundreds of simultaneous connections as is commonplace at many hospitals and schools. So as a minimum the Committee recommends that the state government advocates that all South Australian hospitals and schools be connected directly to fibre.
There have been a number of reports critical of the decision to not fully invest in FTTP. In one such example, from August 2015, the Singaporean telecommunications company MyRepublic announced plans to launch its broadband service in Australia by mid-2016 and stated its goal to be ‘shaking up the entire broadband market.’ 172 In its press announcement it was scathing of the recent changes to the NBN architecture, saying that the NBN ‘had lost its way by moving onto fibre-to-the-node technology, which partly relies on slower copper phone lines to cut costs and save time.’ They continued on to claim ‘I don't know what [the government] is doing on the other policy fronts but on this they've completely stuffed it… More and more Australians will leave the country looking for jobs and you'll continue to be a resource based economy – the hope of building IT jobs and a digital economy will kind of be more difficult to achieve.’
The Committee therefore recommends that, in areas and under circumstances where the copper network is deemed unfit for the purpose, or is expected to be deemed unfit in the near future, the proposed copper-reliant MTM component be replaced by fibre. The Committee strongly recommends that short-term fixes should be avoided. As explained to the Committee in Chapter 9, ‘The other issue too is that, if you do fibre to the node and then use the existing copper, you have to install devices called DSLAMs. The DSLAMs are what convert the NBN to ADSL to go into the premises. The problem with that is that, if later on you decide that the copper is stuffed and you have to do something about it, you are going to have to pull all of the DSLAMs out and provide fibre anyway, so you have a double expense. It's better to do it all in one go and get it done properly.’ Addressing this issue now will ensure that South Australian households, businesses and state government services will have access to a high-quality and standard rate of speed across the network – both in the short-term and the longer-term as service demands increase.
Recommendation 3
The South Australian Government ask NBN Co to publish maps of the expected technology to be used in all regions of South Australia.
One of the recurring issues put by multiple witnesses was that the lack of information concerning the details of the rollout in a particular jurisdiction impacted in a negative, compounding manner. Forward planning was identified as an area that was especially difficult (Chapter 3). In its testimony NBN Co indicated that long term decisions on the allocation of particular technologies to various sites had likely already been made: ‘Given that 2020 is not that far away, from a planning sense, within our organisation, I would be pretty surprised if we didn't have a firm plan on all communities.
172. (Sydney Morning Herald Online, 2015)
Page | 71 Economic and Finance Committee I know we have on a large number of them, so we would be pretty close to having all of that locked down…’ (Chapter 9).
The Committee heard testimony explaining the government’s reluctance to announce details of the rollout ahead of time by Mr Ramsey MP, who believed ‘If you get too far in front of yourself, once again we will hit this wall of disappointment: “Oh, you said we were going to do this six months ago or two years ago you said we were going to do this, we are just sick of hearing that”’ (Chapter 8).
He also stated: ‘The NBN board and the minister are not keen to make an announcement about what is going to happen in three years' time because then people start getting excited, or else depressed by the fact that it's such a long time. Let's get some runs on the board, let's get some premises hooked up and then we will tell you what we are doing next. It's a very conscious decision of the minister not to overegg the expectation and try to build up things before we get here.’ (Chapter 3)
Despite this reluctance to provide the information, the Committee believes that having this information more widely available would be a benefit to the community. One benefit would be helping to combat the unscrupulous business practices of certain people, referred to on more than occasion by witnesses as sharks. These people have preyed on businesses with false claims about what infrastructure needs to be installed when the NBN eventually arrives (Chapter 10).
One interesting potential benefit raised concerned the development of interim services as described in a hypothetical scenario by Prof Eckermann: ‘but if people knew that NBN would only get to Eudunda in five years' time, there is a five-year window there where it may be commercially viable for someone to put some equipment in an exchange and improve DSL services and provide some interim assistance. I would like to think we can encourage NBN Co to not just publish a rolling three- year plan but really a full perspective of its rollout so that people get an idea of what's coming when’ (Chapter 10). This possible activity by entrepreneurial third-party providers was also raised by RDA- FN (Chapter 3). The further information would also allow the state government to better plan for the likely rollout of services for hospitals, schools, training providers and other services.
Recently, there have been signs that this reluctance in releasing rollout information might be easing. In the July quarterly connection update, it is stated that ‘nbn is planning to release a three-year rollout plan in coming months, where more communities will be added to the rollout plan, including those in HFC areas’. 173 This statement is also included in the state specific press releases for Queensland, Western Australia, Victoria and New South Wales.
As previously indicated, this three-year rollout plan was published on 15 October - as this inquiry was in its final stages. The Committee welcomes this announcement, and urges that this release of information be taken one step further, and encompass all areas for which a choice of technology has been decided, including outside of the published three year framework. The Committee encourages the state government to call on NBN Co to release this extra information, including maps of the
173. (NBN Co, 2015(3))
Page | 72 Economic and Finance Committee expected technology solution by location – both to help the community and business prepare, but also for state government service planning.
Recommendation 4
The South Australian Government advocate to NBN Co that the use of satellite services for small centres in South Australia be the technology of last resort.
The Committee received significant testimony, in both written submissions and verbal testimony, that the quality of the NBN service delivered to remote areas of South Australia is vital if the state is to maximise the benefits. This testimony was received from many different sources, including:
• The SA NBN Taskforce (Chapters 3, 4 and 7); • Regional Development Australia – Far North and the Office for Digital Government (Chapter 3); • Port Augusta Secondary School and TAFE SA (Chapter 7); and • The University of Adelaide, Country Health SA, and the National e-Health Transition Authority (Chapter 7).
The testimony has included evidence that the current Interim Satellite Service (ISS) is not operating effectively, leaving many people in remote South Australia with very slow services and significant costs to utilise important services, such as School of the Air. The Committee heard from NBN Co on expected improvements to the satellite service, specifically the building of ten base stations and details of the impending launch of two new dedicated satellites offering speeds of 25/5 (i.e. 25 Mbps download speed and 5 Mbps upload speed, Chapter 2). One of these satellites has subsequently launched successfully. As per the issues identified in Recommendation 3, there is a lack of clarity as to whether many small regional and remote towns in South Australia will be connected to fixed wireless or will have to rely on satellite services. As opposed to fibre connections, the more people connected to satellite services the slower the connections will be.
Mr Ramsey MP informed the Committee that there had been a larger than expected subscription of the ISS, and that the government had compensated for this by expanding the fixed wireless service in regional areas (Chapter 3). The Committee also heard from Prof Eckermann that the new long- term service might not prove to be so long-term after all, and that within five years could very possibly suffer from the same issues which plague the current interim service, in particular high demand for limited bandwidth. It was his belief that ‘the only effective solution, is to progressively reduce the number of people dependent on satellite and that means providing an alternative, whether it be better mobile coverage or shifting the fixed wireless boundary or pushing out fibre to the node or fibre to the home into more areas’ (Chapter 9).
The SA NBN Taskforce in its written submission to the Committee reiterated the state government’s desire that the most capable and affordable technology be available to as many South Australian households and businesses as possible. In particular it was their belief that ‘The use of NBN satellite should be reserved for very remote locations where no other viable options exist’ (Chapter 9). The
Page | 73 Economic and Finance Committee Committee believes that it is in South Australia’s interest that the state government strongly advocate this position, given the state’s dispersed population.
Much evidence was received about the problems encountered when trying to communicate between sites having radically different connection technologies, as would apply between a fast fibre connection and a slow satellite connection. As put by Regional Development Australia: ‘If you have fast broadband and whatever here in Port Augusta and you are providing that service, it is only as good as the service that is being received on the other end’ (Chapter 7).
This mismatch of technologies was referred to by several witnesses as the ‘lowest common denominator’ effect and in practice meant that the slower of the two tended to govern the nature and quality of the communication. The negative impact of this effect on telehealth matters was raised specifically by witnesses representing the University of Adelaide and Country Health SA. The latter witness confirmed that ‘very good, uninterrupted connectivity’ was necessary for the proper conduct and assessment of home telehealth programs (Chapter 7). Similarly, witnesses from the Port Augusta Secondary School discussed the practical issues encountered in the delivery of education under these conditions (Chapter 7).
Therefore the Committee recommends that the state government – through the NBN Taskforce – continue to advocate for the vast majority of small remote townships to be connected to fibre or fixed wireless services rather than having to rely on satellite services. This will both increase the services available to those townships, and preserve the available capacity necessary for truly remote South Australians to access effective satellite technology.
Recommendation 5
The South Australian Government advocate to NBN Co that it improves its communication with local government and community/business groups with additional on-the-ground staff.
The Committee received multiple testimonies concerning the frustration felt at the lack of communication concerning, among several issues, the schedule of the rollout in South Australia (Chapter 10). This lack of information has flow on effects in the local council sphere in terms of future planning and the general state of preparedness for the NBN. This is a significant technological change and requires a great deal of change management for households, businesses and service providers just to make the change to the NBN – let alone to experience the full benefits that can be provided by faster broadband services.
The Committee does not apportion blame for this state of affairs to the current SA NBN staff member, and would like to reiterate its opinion that the scope of the job is simply too broad to be allocated to a single individual – particularly given the geographic spread of the rollout in South Australia. The Committee recommends that regional South Australia should be a focus of additional staff deployed to South Australia by NBN Co for community engagement. The recent announcement
Page | 74 Economic and Finance Committee by NBN Co that they are to train a further 4500 workers with the intention of speeding up the rollout highlights this need for expanded community consultation to aid in forward planning.174
Other matters raised, from constituents to local members of parliament, concern some nuts and bolts issues of the actual installation of NBN devices in private residences. The residents raised several matters including buck passing between NBN Co and telecommunication providers over technical problems encountered during installation. The lack of technical support was also raised by the Willunga Business and Tourism Association (Chapter 10). These issues amplify the need for NBN Co to deploy community engagement staff across South Australia to assist with the rollout as telecommunication providers staff alone are not equipped to deal with all practical issues.
Recommendation 6
All South Australian local governments implement a digital economy strategy and monitor its performance.
The evidence presented from local government officials to the Committee demonstrated that councils will be a key intersection point for local community groups and businesses in the implementation of the NBN rollout. Local government also provides local community facilities such as libraries and community centres that have the potential to be important sites in local adoption.
To maximise these opportunities the implementation of a digital strategy is considered a necessary and important objective. Such a strategy, the Committee feels, should outline each council’s vision about its place in the digital economy and how it can help those within its boundaries make the most of the opportunities that will come with high-speed broadband. While some councils may not regard this as a core responsibility – in a digitally-reliant future this work is essential to maintain a strong community, support local business and effectively deliver local government services.
Some councils have been very proactive in this regard. For example, the City of Prospect was awarded the 2010 Economic Development Strategic Planning Award for its Digital Economy Strategy (2009-2012).175 The City of Victor Harbor has recently partnered with Deloitte Digital and Deloitte Access Economics to understand the level of digital awareness and preparedness of those within its council precincts.176 For other councils there has been the development of a strategy, but no evidence of implementation – and the Committee believes that this means that the goals of each strategy must be realistic and that progress must be monitored.
In an effort to gauge the level of NBN preparedness in South Australia, a digital survey was constructed by the Committee and sent to each of the 68 local governments in the state. The response was disappointingly modest – 19 individual responses from 18 councils.177 Of these
174. (NBN Co, 2015(4)) 175. (City of Prospect, 2010) 176. (Deloitte Access Economics, 2015) 177. Details of the council responses to the survey can be found in Appendix 9.
Page | 75 Economic and Finance Committee respondents, only six have prepared, or are currently in the act of preparing, an e-strategy document. One must always exercise caution when extrapolating data from a small sample set, but it seems likely that fewer than half of South Australia’s local councils have prepared such a document.
Recommendation 7
The state and local governments should serve as exemplars for the benefits of the NBN in the delivery of services, particularly in rural and remote areas.
The Committee believes that governments have an opportunity to be exemplars of what is possible given access to high-speed broadband technology. By developing best-practice utilisation of broadband technology, governments can significantly improve service delivery for South Australians and encourage a faster take-up of technology by the community.
The City of Victor Harbor expressed this view in regard to local council (Chapter 4) and the Committee feels that this should extend to also cover the state sphere. The former stated their belief that the idea of ‘if you build it, they will come’ is a fallacy, and that people actually need to see the product in action to properly assess its potential for their individual and business requirements.
Video-conferencing is one area that the Committee feels would serve this purpose and also demonstrate that the state government is proactive in adopting cutting edge technology. This technology has existed for several decades and has utilised many different technological platforms; the Committee heard evidence on the current level of usage and potential opportunities in areas such as hospitals and schools (Chapter 7).
For example, the Committee considers it somewhat anachronistic that, in 2015, the parliamentary precinct of South Australia does not possess a modern, dedicated videoconferencing service. The benefits of such a service are many and would represent considerable long-term savings to the parliament. For example, committees of the parliament often are required to hear testimony from witnesses who may be located interstate or even overseas; the savings accrued by being able to hear this testimony by videoconference – in travel, accommodation and incidental expenses – are likely to be very substantial and would quickly offset the set-up costs. As an example, the Committee heard testimony by videoconference from Prof Eckermann in his Canberra residence (Appendix 4). This particular hearing was conducted in an ad hoc manner, but its success amply demonstrates the benefits that a dedicated videoconferencing service would provide.
The Committee recommends that a single, common platform should be adopted by the different levels of government in South Australia. The Committee heard evidence from adjacent local government areas that have purchased competing brands of teleconferencing equipment that are unable to communicate with each other (Chapter 8). The Committee believes this is an opportunity for state government leadership to develop a common-platform that can be utilised across the state.
Page | 76 Economic and Finance Committee The Premier of South Australia, the Hon Jay Weatherill MP, announced recently that the state government would be modernising its out-dated ICT systems and services. The stated aim was to make the public sector more innovative:
This is about capturing contemporary technology and solutions so that our public sector has the ICT it needs to do the best work possible. We want to create a leading ICT environment for the public service to make it mobile and adaptive to deliver the best and most efficient services to South Australians. 178
Recommendation 8
The South Australian Government embrace teleworking – both supporting state public servants to telework and encouraging other businesses to adopt more flexible practices.
Recommendation 9
The South Australian Government actively support home businesses that utilise the NBN – including removing, as far as practicable, any planning red-tape that would prevent homes being used for such businesses.
One of the perceived major benefits of widely available access to high-speed broadband is the potential it opens for the establishment of home-based businesses. One of the instant benefits of a home-based business is that one’s residence is also one’s business premises; this brings the concomitant bonus of dramatically reduced establishment and running costs.
As described by the ACS representative, when such businesses are run well, the client has ‘no idea where I am at any time. I could be sitting at home in Auburn, or I could be in my office in Adelaide, or I could be in Tokyo.’ Through these home businesses powered by the NBN, South Australia has an opportunity to boost its entrepreneurism and develop new job opportunities working for clients, not just locally but across the globe.
The Committee also heard evidence of the positive lifestyle effects that teleworking can have, including the ability to return to the workforce more quickly after having children (Chapter 4).
There has long been a perception that Australian workers in certain disciplines, predominantly the sciences, have needed to leave the state or the country in order to properly ply their skills in their chosen field - the so-called brain drain. Teleworking would afford these individuals the opportunity to physically remain in South Australia but effectively work interstate or overseas – giving the potential for many successful expatriates to return home and continue their career. One notable example concerning an award winning locally-based film production company was described for the Committee (Chapter 4).
178. (Office of the Premier, 2015)
Page | 77 Economic and Finance Committee The successful use of teleworking and home-businesses as described relies entirely on a reliable high-speed broadband connection. The absence of such a service in Port Augusta currently and its impact on home businesses was explained to the Committee by members of Business Port Augusta (Chapter 4).
The Committee believes that teleworking will continue to increase in the future and should be embraced, not only by business – both large and small – but also by government and the public service. The Committee recommends that the government, through provision of small business support, encourages the establishment of as many home-based businesses as possible. As part of its support, the Committee recommends that the scheme similar to one developed by the Australian Computer Society and described in Recommendation 10 (below) be adopted. The state government should also ensure as part of its ongoing state planning reforms that there are no red-tape impediments that would prevent South Australians from operating NBN-enabled businesses from their own residential-zoned premises.
The Committee also recommends that through its own employment practices the state government becomes an exemplar on teleworking for its own employees when appropriate – and encourages other businesses to follow its lead.
Recommendation 10
The South Australian Government investigate implementing a program to help small businesses connect with nearby ICT providers that can improve their digital presence and utilisation.
In its testimony, the Australian Computer Society described a program it runs in collaboration with Digital Business Insights (Chapter 4), in which businesses needing ICT support are put in contact with nearby local ICT businesses able to provide it. The ACS described this program as operating successfully in Melbourne, with a similar program set to begin shortly in Queensland. As put by the ACS: ‘It is a very simple concept, but it is very valuable to have that on-the-ground intelligence about where the weaknesses are and who you can go to solve the problem.’ It indicated that without such a program, businesses needing support might search internationally for ICT support, when the support they need could be (literally) just around the corner.
The ACS indicated that it had held initial briefings with the Department of State Development (DSD) outlining the details of this scheme, and that those discussions had been encouraging. It further indicated that there was ‘definitely interest from small business’ toward the scheme.
The Committee recommends DSD investigate developing a similar program, focussing on South Australian business concerns and helping in particular those businesses who have very little digital presence and could grow their business with the help of a South Australian ICT provider.
Page | 78 Economic and Finance Committee Recommendation 11
The South Australian Government actively promote and, where possible, facilitate the implementation of telehealth programs in the delivery of primary health care and acute hospital services.
The Committee received submissions and heard evidence about the expanding role of telehealth within the South Australian health sector and its potential for greater uptake with the rollout of the NBN (Chapter 7). NEHTA provided a detailed written submission outlining the role that telehealth can play in Australia. To summarise its views, it believes that ‘A widespread implementation of eHealth services, facilitated by the NBN will improve the efficiency of the health sector and generate significant financial savings for all levels of Government, as well as savings and quality of life improvements for all Australians.’
Assoc Prof Mills from the University of Adelaide described the issues faced from an academic and teaching perspective, while Ms McRae from Country Health SA described the practical issues faced on the health front line. Both indicated the frustration experienced by patients and practitioners from having to use substandard internet services, another example of the lowest common denominator principle. This issue notwithstanding, Ms McRae indicated the successful nature of some telehealth trials in rural South Australia; these trials included focusses on psychiatric care, renal health and burns recovery. Both of these witnesses outlined the time and cost savings that could be expected from the successful implementation of a telehealth program.
The Minister for Health, the Hon Jack Snelling MP, recently launched the Virtual Clinical Care service.179 As stated in the announcement, ‘Many people living with chronic disease, such as respiratory and heart conditions or diabetes, can find it difficult to manage their health, leading to more doctor visits and unplanned hospital admissions. This can be particularly challenging for people living in remote areas of our state who often have long distances to travel and as a result may decide to ignore their symptoms until it is too late.’ The program will provide participants with health monitoring equipment to record certain health parameters which will then be digitally transmitted to an assessment team of health experts who will then arrange appropriate follow-up action.
More recently still, as part of National Science Week, a Flinders University led project utilised the MIMP microwave network in the remote South Australian community of Arkaroola to demonstrate the utility of telehealth technology. In this event, locals had their blood pressure taken in Arkaroola and reviewed by a health professional in Adelaide, approximately 700 km away.180
An accelerated implementation of telehealth services, aided by the rollout of the NBN, will have the potential to significantly improve health outcomes for South Australians. This will be particularly important in regional South Australia where there is not easy access to a wide range of specialist
179. (The Hon Jack Snelling MP, 2015) 180. (Impress Media, 2015)
Page | 79 Economic and Finance Committee consultations and advice, and in remote areas where even access to a general practitioner is problematic.
Recommendation 12
The South Australian Government increase ICT training programs through the VET sector and encourage a similar increase in the university sector to meet the expected increased demand for ICT professionals.
That the need for properly targeted ICT training programs was paramount if South Australia is to combat the digital disruption phenomenon was made clear in many of the submissions received by the Committee and also formed the focus of much of the testimony heard. As highlighted in the ACS submission to the inquiry, the VET sector in Australia has approximately three times the total student number as the university sector, and is responsible for ‘much of the ‘heavy lifting’, both in terms of providing pathways to employment for those leaving school and for equipping people to move from lower to higher value jobs or form one industry to another.’ The Committee recognises that South Australia needs a VET system that is both agile and flexible enough to respond to the changing needs of employers. The ACS also made reference to the long term underinvestment by employers in upskilling and reskilling the existing workforce, with the result of an increasing reliance on skilled and temporary migration schemes to try and fill vacancies (Chapter 6)
Several submissions received made reference to, and incorporated data from, publications issued by Deloitte181,182 including one issued in conjunction with the South Australian Office of the Chief Information Officer.183 These studies indicate the effectiveness of digital engagement by SMEs with some key points being that small businesses with high levels of digital engagement:
• experienced a 20 per cent increase in revenue; • were twice as likely to experience revenue growth; and • were four times more likely to be hiring new staff.
In addition, small businesses using digital marketing strategies - such as SEM and SEO - are 40 per cent more likely to be growing than those using the internet for basic business functions only. Also, more than half of highly engaged small businesses have a website with optimised sites for mobile phone access.
These positive outcomes and indicators highlight the real benefits that small business can access. However, the ACS submission also discussed a survey which highlighted the ‘worrying’ state of preparedness of SMEs for the new digital economy. In subsequent oral testimony, they expressed their belief that businesses which did not properly equip themselves with the skills needed to maximise the benefits of high-speed broadband would ‘go out backwards if they don't embrace it.’ It was also their opinion that what was needed was ‘clear, pragmatic advice and information’ because a lot of small businesses ‘have no idea’ (Chapter 4). The Committee also engaged the ACS in
181. (Deloitte Access Economics, 2013) 182. (Deloitte Access Economics, 2014) 183. (Deloitte Access Economics, 2014(2))
Page | 80 Economic and Finance Committee much discussion on the issues of training (Chapters 6, 7 and 8) for individuals who have found themselves unemployed as the result of the closure of long standing enterprises, such as the automotive industry. They also provided the Committee with valuable statistics concerning the distribution of ICT employment and enrolment in South Australia (Chapter 6).
Business Port Augusta raised the fact the lack of communication with NBN Co was severely limiting their ability to prepare and conduct the training courses they feel are necessary for their members to utilise the NBN (Chapter 10).
The Committee therefore believes that for South Australian to reap the potential rewards offered by access to high-speed broadband, adequate training programs must be available and accessible to all who wish to participate. Such courses should include a strong focus on delivering a high standard of ICT competency. Furthermore, as the ICT landscape is so dynamic and subject to radical changes in a short time-frame, graduates should exit these courses equipped with a skill set that is both contemporary and adaptable. To ensure the job readiness of graduates, items such as project management, leadership and effective communication skills should form a major focus of these training courses. The Committee recommends that Work Integrated Learning (WIL) be a prominent feature of ICT training; tertiary graduates not being ready for work and needing on the job training is the most commonly cited concern among employers. Therefore, the integration of WIL into both VET and tertiary ICT courses, with the aim of increasing the immediate job readiness of graduates is strongly encouraged by the Committee.
Recommendation 13
The South Australian Government through the public education system and the VET sector increase the provision of science, technology, engineering and mathematics (STEM) subjects to meet the projected demand.
Recommendation 14
The State Government expand the teaching of coding in public schools so that every public primary and high school student should have access to this important skill.
The Committee received submissions and heard evidence about the crucial nature of the STEM subjects to the growth of an advanced digital based economy. The ACS made reference to the fact that in Europe STEM based jobs were projected to grow at a faster rate than they could be filled, and cited a report suggesting that ‘there will be 900,000 jobs in the European ICT sector unfilled due to a lack of appropriately skilled workers’ and also to the fact that ‘in the United States, employment in these STEM occupations is projected to grow almost as fast between 2008 and 2018 as employment in all other occupations combined’ (Chapter 6). It is the ACS’s opinion that there will be significant
Page | 81 Economic and Finance Committee opportunities for ICT jobs in South Australia if STEM education can be increased to meet the projected demand.
The Advanced Technology Project184 is an initiative funded by the Commonwealth and managed by the DECD with professional development provided by the Australian Science and Mathematics School. The stated aims of the project are to:
• increase the number of students studying STEM subjects; • increase the number of young people who undertake career pathways in engineering, electrotechnology, technical design and manufacturing via apprenticeships, VET and university studies; and • prepare students for careers in South Australia’s defence and allied industries.
There are 19 South Australian Schools participating in the program and these schools have been clustered together in their particular region in order to share resources and services. Such a program would obviously benefit from the availability of reliable high-speed broadband. Projects like this will need to be expanded throughout both the public school and VET sectors if South Australia is going to meet the demand expected for ICT professionals within the next decade.
It was a common theme amongst those witnesses that addressed these issues that it is vital that children be introduced to the digital world at as early an age as possible. The Committee visited the Aldinga Beach B-7 School - one of the first schools connected to the NBN - and witnessed students actively engaged in coding using both educational toys (bee bots) as well as in an interactive manner using the resources available at www.code.org (Chapter 7). A fundamental issue raised by several witnesses was the introduction of the technology should be fun as well as educational, and that groups such as Code Club need to be encouraged and expanded. The ability to deliver courses such as this is not currently available at all schools and to meet that goal there would need to be a major increase in the training of teachers in these new and increasingly important digital languages. Delivering this teacher training would require linking with industry and other experts to develop the materials and support that schools would need.
At present, coding is a part of the Australian curriculum, through the Digital Technologies subject185, and is divided into four sections:
1. Digital Systems: Addresses the need for students to have an understanding of the components and their interrelationship in a digital system.
2. Data and Data Collection, Management Analysis: This section focuses on the knowledge and understanding required to capture and use a wide range of data types relevant to digital systems, including binary data.
3. Computational Thinking: Students have multiple opportunities to explore the key elements of a problem solving cycle that requires definition, design, implementation and evaluation. Coding is an integral part of this learning area.
184. Information can be obtained for the project from: http://dlb.sa.edu.au/atmoodle/ 185. Details of the ACARA digital curriculum can be found in Appendix 10.
Page | 82 Economic and Finance Committee Embedded in this topic are opportunities for students to use, develop and refine a range of programming, coding environments, to create relevant digital solutions. The following are examples of how coding is being taught in DECD schools:
• R to Y2 students are learning to program Bee-Bot robots using simple coding principles; • Students in Y3 to Y7 are using Massachusetts Institute of Technology's Scratch coding environment to solve a range of maths and science problems; • Secondary students also use Scratch and Python to control sensor interface circuits and coding tools such as Swift, DreamSpark and Appinventor to create mobile apps.
4. Collaborating and Managing Digital Systems: This topic focuses on students creating, organising and sharing information online, safely.
This curriculum begins at Reception and runs through to Year 10, with the content set at levels commensurate with the skills and age of the students. The aim of this component of the curriculum is to enable future students to not only be efficient users of ICT, but also to become capable and assured creators of ICT. The Committee notes that other countries, in particular the United Kingdom, are moving forward with the implementation of coding and other digital subjects into their national education curriculum.
Recommendation 15
Technical and policy issues with the Department of Education and Child Development firewall be addressed to ensure schools receive the full benefit of the NBN.
For a school to properly achieve the benefits that the NBN will offer, it needs access to the full speed of the new connection. The Committee visited several schools - two each in the southern and northern sections of the greater Adelaide metropolitan area (Chapter 7). A common issue raised among these schools concerned the firewall software employed by DECD.
At some of these schools - and in particular Willunga High School - the connection of the NBN initially delivered an unexpectedly small speed increase for student connections due to that firewall software. It was not until the firewall provisions were addressed that a noticeable speed was demonstrated from the NBN investment.
In addition, a situation, described repeatedly as frustrating, was illustrated in which authorisation to access certain sites was needed on multiple occasions, even when such authorisation had been granted on previous occasions, or had been granted to other schools under DECD’s jurisdiction. A similar state of affairs was also described by RDA-FN in relation to the ‘School of the Air or any platform that requires a government firewall breach. Through the government firewall there are real issues.’ (Chapter 3).
The Committee recognises that while the motives behind these restrictions might be unimpeachable, and that the protection of South Australia’s young and vulnerable should be a
Page | 83 Economic and Finance Committee paramount consideration, a practical consequence of these constraints is inhibition of the learning process. The Committee therefore recommends that DECD address technical issues with the firewalls that would prevent schools that newly connect to the NBN from gaining the full benefit of the extra speed that will result.
In addition the Committee recommends that the ad hoc nature of the firewall policy be streamlined in such a way that once access is deemed acceptable, it should become available for access by all schools and students. There are, of course, likely to be exceptions which should fall outside of this blanket approval process. For example, more senior students might be required to undertake assignments concerning topical, sensitive areas of study that would be considered unsuitable for students at a lower level. To accommodate such scenarios, a system which grades the suitability of material in terms of the educational level of the student requesting access would be appropriate.
Recommendation 16
The Department of Education and Child Development, using the lessons learnt from early adopter NBN schools, prepare promotional material highlighting the benefits of being NBN connected for both teachers and students.
During its visit to the southern schools the Committee was able to observe, through presentations made by both staff and students at Willunga High School, how having the NBN has enhanced both the teaching and learning processes (Chapter 7). For students, being able to incorporate aspects of the gaming culture, through programs such as Minecraft, into the educational curriculum was a definite bonus. In addition the Committee was shown how access to the NBN had assisted students to enhance the experience of the Year 12 Research Project. Willunga High School has also launched its own weather balloon, with both its launch and subsequent progress able to be tracked through the internet. A similar sense of the benefits was observed with the students at Aldinga Beach B-7 School, which also is NBN-connected.
Willunga High School was the first school in South Australia, and one of the first in Australia, to be NBN-connected. As such, it was featured in NBN promotional material186 as well as in education trade literature in 2013.187,188 The staff at Willunga outlined for the Committee the importance of the NBN funding and other resources available to them as an early site. The Committee was informed that in the process of implementation of the NBN there were many lessons learnt and mistakes made along the way to get to their present, advanced point.
186. (NBN Co, 2013(2), pp. 11-17) 187. (Australian Teacher, 2013, vol 2) 188. (Australian Educator, 2013, issue 78)
Page | 84 Economic and Finance Committee The Committee therefore recommends that DECD work to ensure that the lessons learnt from early adopter schools such as Willunga High School are transferred to newly connected schools, to avoid continual repetition of the same learning process. DECD should also produce promotional material for teachers and the community featuring early adopter schools as examples of the enhanced educational experience provided by access to reliable, high-speed broadband.
Recommendation 17
All schools in the state implement an ICT strategy that ensures the benefits of being NBN connected are fully accessible to all students.
One feature that was common amongst all the schools visited by the Committee was the need for schools to have an ICT strategy, encompassing the school’s policy on equipment, and incorporation of ICT materials into the curriculum. Many schools are using the internet to create a ‘flipped classroom’ where homework is watching a presentation, with the exercise work taking place at school with the teacher and peers. This use of technology at home highlights the need for high- speed connections at individual households, not just at education institutions themselves.
The ubiquitous nature of mobile phones, and more recently tablets, coupled with the fact that students will inevitably bring these devices with them to school, has moved some schools to institute a Bring Your Own Device (BYOD) policy, covering the rights and responsibilities of students in possession of such equipment on school territory. BYOD has the potential to greatly increase student access to technology - given that any device can be used by students as long as it can connect to the school WiFi network. At Willunga High School BYOD has allowed the school to focus the delivery of its technology budget towards students whose families cannot afford a laptop.
The Committee recommends that all schools in the state, if they have not already done so, prepare an ICT strategy document, including BYOD, proposing their individual policies. Such a document will likely become more important as more schools become connected to the NBN and avail themselves of the opportunities that will accompany access to high-speed broadband. Given the resource implications of writing strategies across all schools – it is recommended that DECD prepare a pro- forma ICT strategy that can be adapted for individual school use. Importantly each school’s strategy must not only be written, but must be successfully implemented and the progress made should be regularly reviewed.
Page | 85 Economic and Finance Committee Recommendation 18
The South Australian Government, in conjunction with local government, actively promote those areas of the state that have been connected to the NBN.
Recommendation 19
The South Australian Government use the NBN and its benefits to promote regional growth in South Australia.
Although only small sections of the state - at the time of compiling this report - have been connected to the NBN, it is already making an impact. The City of Onkaparinga indicated that having broadband available ‘has definitely attracted some people to live down here now’ (Chapter 3). The kinds of people indicated in this statement included professionals, international traders and people engaged in high-level management. As stated by the City of Onkaparinga: ‘being able to share that knowledge… is really important.’
As more and more regions of the state become NBN-connected, the attraction of moving away from the city to more pleasant rural surroundings – the so-called sea change or tree change – is likely to increase. The City of Victor Harbor believed that a large communication campaign was necessary to stimulate new business investment, in order to increase their level of permanent residency (Chapter 4). In order to facilitate such population movement, i.e. the concept of ‘live in the outback, but reach the world’, an absolute requirement would be a reliable, high-speed broadband service. Coupled with this should be a willingness on the part of local governments and local business and tourism associations to increase their online presence – promoting their regions with the distinct advantage of being NBN connected. Recommendation 6 (above) covers this point from a local council perspective.
Page | 86 Economic and Finance Committee Appendix 1
Inquiry Terms of Reference
In October 2014, the Economic and Finance Committee of the South Australian House of Assembly, on its own motion, announced an inquiry into the National Broadband Network. The terms of reference as published were:
1. How the delivery of the National Broadband Network can contribute to South Australia’s: • Economic growth, entrepreneurship and employment opportunities, in metropolitan and regional areas; • Business efficiencies and revenues, particularly for small and medium businesses and sole- traders; • Research, development and innovation; • Productivity and workforce participation; and • Delivery of government services and programs including health, education and training.
2. What policy, program and other enablers will need to be in place to maximise these benefits for South Australia.
3. What the impact will be on South Australia from the changes to the structure and schedule of the Federal Government’s National Broadband Network program, particularly ending the rollout of fibre-to-the-premises.
4. Any other relevant matter.
Page | 87 Economic and Finance Committee Appendix 2
The Economic and Finance Committee
Membership The Economic and Finance Committee (the Committee) is established under section 4 of the Parliamentary Committees Act 1991. Section 5 states that the membership of the Committee is to comprise seven members of the House of Assembly. A Minister of the Crown is not eligible for appointment to the Committee.
The seventh Economic and Finance Committee was appointed by the House of Assembly on May 6, 2014 following the State Election, held 20 March 2014. The following members were appointed to the Committee: Mr Lee Odenwalder MP; the Hon Paul Caica MP; the Hon Iain Evans MP; Mr Martin Hamilton-Smith MP; Ms Katrine Hildyard MP; Mr Chris Picton MP and Mr David Pisoni MP.
• On 15 May 2014 Mr Lee Odenwalder MP was nominated as the Presiding Member. • On 27 May 2014 Mr Martin Hamilton-Smith MP resigned from the Committee. • On 17 June 2014 Mr Dan van Holst Pellekaan MP was appointed to the Committee. • On 30 October 2014 the Hon Iain Evans MP resigned from the Committee and Parliament. • On 30 October 2014 Mr David Speirs MP was appointed to the Committee. • On 10 February 2015 Ms Katrine Hildyard MP resigned from the Committee. • On 10 February 2015 the Hon Jennifer Rankine MP was appointed to the Committee.
The following Members currently comprise the Economic and Finance Committee: Mr Lee Odenwalder MP (Presiding Member) The Hon Paul Caica MP Mr Chris Picton MP Mr David Pisoni MP The Hon Jennifer Rankine MP Mr David Speirs MP Mr Dan van Holst Pellekaan MP
Executive Officers to the Committee Mrs Lisa Baxter, Ms Kendall Crowe and Ms Susie Barber*
Research Officer to the Committee Dr Gordon Elsey
Members of the Committee are appointed pursuant to section 20, and cease to be members pursuant to section 21 of the Parliamentary Committees Act 1991.
* Ms Barber resigned her position on 10 July 2015 and was replaced by Ms Crowe on 31 August 2015
Page | 88 Economic and Finance Committee Functions The functions of the Economic and Finance Committee are set out in section 6 of the Parliamentary Committees Act 1991. These are: (a) to inquire into, consider and report on such of the following matters as are referred to it under this Act: (i) any matter concerned with finance or economic development; (ii) any matter concerned with the structure, organisation and efficiency of any area of public sector operations or the way in which efficiency and service delivery might be enhanced in any area of public sector operations; (iii) any matter concerned with the functions or operations of a particular public officer or a particular State instrumentality or publicly funded body (other than a statutory authority) or whether a particular public office or a particular State instrumentality (other than a statutory authority) should continue to exist or whether changes should be made to improve efficiency and effectiveness in the area; (iv) any matter concerned with regulation of business or other economic or financial activity or whether such regulation should be retained or modified in any area; (b) to perform such functions as are imposed on the Committee under this or any other Act or by resolution of both Houses.
References Pursuant to section 16 (1) of the Parliamentary Committees Act 1991, any matter that is relevant to the functions of the Committee may be referred to the Committee - (a) by resolution of the House of Assembly; (b) by the Governor, by notice published in the Gazette; (c) of the Committee's own motion. Subsection (1) is in addition to, and does not derogate from, the provisions of any other Act under which a matter may be referred to the Committee.
Ministerial responses Pursuant to section 19 of the Parliamentary Committees Act 1991, if a report contains recommendations, the Minister with responsibility in the area concerned is required to respond within four months and include in the response statements as to - • which (if any) recommendations of the Committee will be carried out and the manner in which they will be carried out; and • which (if any) recommendations will not be carried out and the reasons for not carrying them out.
The minister must cause a copy of the response to a Committee's report to be laid before the Committee's appointing House within six sitting days after it is made.
Page | 89 Economic and Finance Committee Appendix 3
Submissions Received
No. Name Position Organisation 1 Mr David Garrett Private Citizen 2 Mr Michael Zerman Private Citizen 3 Mr David Kalleske Operations Manager Rockford Wines 4 Prof Robin Eckermann Principal Robin Eckermann & Associates 5 Mr Matt Grant Director, Business & Economic City of Prospect Development 6 Mr Rick Cairney Director of Policy Business SA 7 Mr Peter Fleming CEO National e-Health Transition Authority (NEHTA) 8 Mr Bret Morris CEO and Chair SA National Broadband Network Taskforce 9 Mr John Moyle CEO City of Tea Tree Gully 10 Ms Brenda Stocks Project Manager Australian Computer Society 11 Ms Lynn Spurling President Public Libraries SA 12 City of Onkaparinga 13 A/Prof David Mills Head, Discipline of Rural Health University of Adelaide 14 Mr Keith Green Senior Technician Arid Land Communications 15 Mr Phil Strike Facilities Manager TafeSA, Port Augusta 16 Mr Jim Carden Executive General Manager, NBN Co Government Relations 17 Ms Vivienne Holloway Manager of Economic and City of Victor Harbor Tourism Development 18 Mr Nick Champion MP Member for Wakefield Commonwealth Parliament
Page | 90 Economic and Finance Committee Appendix 4
Public Hearings
Date Name Position Organisation 12 March 2015 Mr Brett Benbow Deputy Mayor Port Augusta City Council Mr Michael Acting CEO Dunemann Ms Cherie Gerlach Manager, Media and Communications 12 March 2015 Mr David Versteeg Chair Business Port Augusta Mr Darren Sherriff Treasurer 12 March 2015 Mr Troy Grover Deputy CEO and Regional Development Enterprise Development Australia - Far North Manager Mr Mark Sutton Deputy Chair Regional Development Australia - Far North
Director Office for the Outback Communities Authority 13 March 2015 Mr Keith Green Owner/Senior Technician Arid Land Communications Mr Andy Mason Senior Technician 13 March 2015 A/Prof David Mills Head of Discipline of University of Adelaide Rural Health Mr Harrison Haynes Community Engagement Officer, Port Augusta 13 March 2015 Mr Robin O'Dea Regional Manager TAFE SA Mr Phil Strike Facilities Manager 13 March 2015 Ms Ros McRae Regional Director, Eyre, Country Health SA Flinders and Far North East Rural Region 13 March 2015 Mr Paul Billows Principal Port Augusta Secondary School Mr Simon Harding eLearning Coordinator 26 March 2015 Mr Athol Chalmers Manager, Federal and Australian Computer State Government Society Relations Ms Jo Stewart-Rattray Chair, SA Branch
Page | 91 Economic and Finance Committee Date Name Position Organisation 7 May 2015 Mr Rowan Ramsey MP Member for Grey Commonwealth Parliament 7 May 2015 Mr Adrian de Brenni Director, Programs and Office for Digital Investment Government Mr Rick Seaman Acting Director Mr Peter Williams Manager, Digital Department of State Economy and Technology Development Mr Phil McMahon Chief Operating Officer Department of the Premier and Cabinet 21 May 2015 Mr Tony Bezuidenhout Manager, ICT City of Onkaparinga Mr Glenn Hickling Economic Growth Officer Mr David Peters General Manager, District Council of Mt Corporate Services Barker Mr Brad Rohrlach ICT Officer Ms Vivienne Holloway Manager, Economic City of Victor Harbor Development and Tourism Mr Colin Shackleford Manager of Community Alexandrina Council Wellbeing Mr Terry Lee Director Regional Development Australia - Adelaide Hills, Fleurieu and Kangaroo Island 21 May 2015 Ms Pip Forrester Chairperson/Treasurer Fleurieu Food Ms Billy Doecke Assistant Manager Willunga Farmers Market 21 May 2015 Ms Hazel Wainwright Chair Aldinga Bay Business and Tourism Association Mr Martin Howells Vice Chair/Secretary Mr Tom Laing Willunga Business and Tourism Association Mr Daniel Roach Chairperson Seaford/Moana Business and Tourism Association 29 May 2015 Mr Phil Harrison Advocacy Specialist City of Playford Mr Greg Pattinson Acting General Manager, Planning, Strategy and Compliance Mr John Moyle CEO City of Tea Tree Gully Mr Ryan McMahon Director, Organisational Services and Excellence
Page | 92 Economic and Finance Committee Date Name Position Organisation 29 May 2015 Mr Michael Clark Director of Corporate Service to Youth Council Strategy Ltd Ms Lauren Dimas Head of Partnerships 29 May 2015 Mr Greg Ratsch Manager, Economic City of Salisbury and the Development and Urban Polaris Centre Policy 11 June 2015 Mr Justin Jarvis National Manager, State NBN Co Ltd Government Relations Mr Chris Gregory Manager, Community Affairs SA 30 July 2015 Prof Robin Eckermann Principal Robin Eckermann and Associates
Page | 93 Economic and Finance Committee Appendix 5
Other Committee Activities – School Tours
As part of the inquiry the Committee visited five schools. The aim of these visits was to investigate the level of engagement of schools with digital technology and to assess the potential pedagogical benefits the national broadband network might offer to primary and secondary education in South Australia. The visits typically involved:
• meeting with senior staff and student representatives;
• brief demonstrations of digital teaching methods;
• a round table discussion.
With the single exception of Port Augusta Secondary School, these discussions were off the record, and therefore were not transcribed by Hansard. The schools visited, and their official spokespersons are listed below:
• Port Augusta Secondary School, visited 13/03/2015 - Mr Paul Billows, Principal;
• Aldinga Beach B-7 School, visited 21/05/2015 - Mr David Dewar, Deputy Principal;
• Willunga High School, visited 21/05/2015 - Ms Janelle Reimann, Principal;
• Gawler & District College B-12, visited 29/05/2015 - Mr Andrew Dickinson, Principal;
• Fremont-Elizabeth High School, visited 29/05/2015 - Mr Rob Knight, Principal.
Page | 94 Economic and Finance Committee Appendix 6
Glossary
ABC Australian Broadcasting Commission (prior to 1 July 1983) Australian Broadcasting Corporation (after 1 July 1983) ACARA Australian Curriculum, Assessment and Reporting Authority ACCC Australian Competition and Consumer Commission ADSL Asymmetric Digital Subscriber Line AIIA Australian Information industry Association ALP Australian Labor Party AOTC Australian and Overseas Telecommunications Corporation APY Anangu Pitjantjatjara Yankunytjatjara ATC Australian Telecommunications Commission ATP Advanced Technology Program AT&T American Telephone and Telegraph Company BAG Broadband Advisory Group BB Broadband BPA Business Port Augusta BYOD Bring Your Own Device CAN Customer Access Network CBA Cost-Benefit Analysis CEO Chief Executive Officer CSIRO Commonwealth Scientific and Industrial Research Organisation CY Calendar Year DECD Department of Education and Child Development DOCSIS Data Over Cable Service Interface Specification DSLAM Digital Subscriber Line Access Multiplexer DTED Department of Trade and Economic Development EFTPOS Electronic Funds Transfer at Point Of Sale FM Frequency Modulation FSAM Fibre Service Area Module FTTB Fibre-to-the-building FTTdp Fibre-to-the-distribution-point FTTK Fibre-to-the-kerb FTTN Fibre to the node FTTP Fibre-to-the-premises
Page | 95 Economic and Finance Committee GP General Practitioner GPO General Post Office HFC Hybrid Fibre Coaxial ICT Information and Communications Technology ICU Intensive Care Unit INTELSAT International Telecommunications Satellite Organisation IoT Internet of Things ISS Interim Satellite Service LTSS Long-Term Satellite Service Mbps Megabits per second MDU Multiple Dwelling Unit MOOC Massive Online Open Courses MP Member of Parliament MTM Multi-Technology Mix NASA National Aeronautics and Space Administration NBN National Broadband Network NEHTA National e-Health Transition Authority OCA Outback Communities Authority ODG Office for Digital Government OTC Overseas Telecommunications Commission PAMTS Public Automatic Mobile Telephone System PMG Postmaster-General’s Department RDA-AFK Regional Development Australia - Adelaide Hills, Fleurieu and Kangaroo Island RDA-FN Regional Development Australia - Far North RFP Request for Proposals RFS Ready for Service SEM Search Engine Marketing SEO Search Engine Optimisation SFIA Skills Framework for the Information Age SME Small to medium enterprise STEM Science, Technology, Engineering and Mathematics ToR Term(s) of Reference VDSL Very-high-bit-rate Digital Subscriber Line VET Vocational Education and Training WIL Work Integrated Learning
Page | 96 Economic and Finance Committee Appendix 7
Timeline of Australian Telecommunication Milestones189,190,191
Pre-Federation (1854-1900) 1854 The first telegraph line in Australia, linking Melbourne and Williamstown, begins operation. Mr. Samuel W. McGowan becomes the first General-Superintendent of the new Electric Telegraph Department.
1858 Adelaide, Melbourne and Sydney become linked by telegraph lines.
1861 Brisbane becomes linked to Sydney by telegraph line.
1872 The Overland Telegraph Line, linking Adelaide and Darwin (~3200 km) is completed. It is shortly thereafter connected to the undersea cable linking Darwin and Java.
1877 Perth becomes linked to Adelaide by telegraph line.
1880 The first Australian telephone exchanges begin operation in Melbourne, Sydney and Brisbane.
1883 Telephone exchanges in Adelaide and Hobart begin operation.
1887 Telephone exchange in Perth begins operation.
1893 The first public telephone is opened at Sydney’s GPO.
1898 The first recorded demonstration of wireless telegraphy in Australia takes place in Adelaide; transmission occurs over a distance of approximately 500m.
Post-Federation (1901-2000) 1901 The newly formed Commonwealth Government establishes the Postmaster- General’s Department (PMG). The PMG is responsible for all postal and telegraphic services in Australia The first Australian radiogram is sent from St Kilda to HMS St George.
1905 Commonwealth Parliament passes the Wireless Telegraphy Act 1905, giving control of all wireless services to the PMG.
1907 The Melbourne-Sydney trunk telephone line begins operation.
189. (Australian Journal of Telecommunications and the Digital Economy, 2014, vol 2) 190. (Australian Bureau of Statistics, 2001) 191. (Burger, 2006)
Page | 97 Economic and Finance Committee 1912 The first coastal wireless station opens in Melbourne. Automated telephony (i.e. number dialling) comes into operation in Australia. The first public automated telephone exchange in the Southern Hemisphere begins operation in Geelong.
1914 The first automated exchange in NSW opens in Newtown.
1922 The Sydney-Brisbane trunk telephone line begins operation.
1932 The Australian Broadcasting Commission (ABC) is established and begins service on 1 July.
1946 The Commonwealth Government establishes the Overseas Telecommunications Commission (OTC). The OTC is responsible for all international telecommunications services into, through and out of Australia.
1947 The transistor is invented at AT&T’s Bell Laboratories.192
1956 The first television transmissions in Australia are made from Sydney (TCN-9) and Melbourne (ABC).
1964 Australia becomes a founding member of the International Telecommunications Satellite Organisation (INTELSAT). Sydney, Canberra and Melbourne become linked by coaxial cable.
1966 First international satellite broadcast between Australia and the UK.
1967 First international satellite broadcast between Australia and the USA.
1975 Colour television broadcasts commence in Australia. The PMG is replaced by two new commissions: • Responsibility for postal services is transferred to the Australian Postal Commission, trading as Australia Post; and • Responsibility for domestic telecommunication services is transferred to the Australian Telecommunications Commission (ATC), trading as Telecom Australia.
1976 Automated direct dialling is introduced in Australia, giving access to 13 countries.
1981 Australia’s first fully computerised telephone exchange opens in Victoria. Telecom launches the country's first mobile network, the Public Automatic Mobile Telephone System (PAMTS) and the first car phone. Commonwealth Parliament creates AUSSAT Pty Ltd, a government owned company to own and operate the national satellite system.
192. (American Physical Society, 2000)
Page | 98 Economic and Finance Committee 1984 Commonwealth Parliament passes the Satellite Communications Act 1984, paving the way for the launch of Australian communication satellites.193
1985 Australia’s first commercial communications satellites, Aussat 1 and 2, are launched in August and November, respectively.
1987 Aussat 3 launched.
1991 Commonwealth Parliament passes the Telecommunications Act 1991, paving the way for competition in the Australian telecommunications market.194
1992 Telecom and the OTC are merged to become the Australian and Overseas Telecommunications Corporation, whose name is subsequently changed to Telstra Corporation Limited. Optus Communications acquires AUSSAT Pty Ltd, to become Australia’s first privately owned communications provider. Vodafone becomes the third communications provider, with an exclusively digital license.
193. Available at: https://www.comlaw.gov.au/Details/C2004A02885, Accessed 22 June 2015 194. Available at: https://www.comlaw.gov.au/Details/C2004A04173, Accessed 22 June 2015
Page | 99 Economic and Finance Committee Appendix 8
Figures and Tables
Table 2: Sites where fibre rollout has either been completed or is underway.195 FSAM Premises RFS Commenced Aldinga 01 1,058 x Aldinga 02 2,287 x Aldinga 03 2,238 x Aldinga 04 1,505 x Aldinga 05 1,517 x Onkaparinga 01 1,932 x Prospect 01 2,839 x Prospect 02 2,615 06/15 Prospect 03 2,816 x Prospect 04 2,430 x Prospect 05 2,041 07/15 x Prospect 06 2,004 x Modbury 01 2,099 x Modbury 02 2,273 x Modbury 03 1,987 x x Modbury 04 2,592 07/15 x Modbury 05 2,214 06/15 x Modbury 06 2,643 10/15 x Modbury 07 2,589 10/15 x Modbury 08 Reallocated to MTM-HFC (03/15) Modbury 09 2,678 11/15 x Strathalbyn 01 2,659 x Macclesfield 01 1181 Q1/16 x Seaford 01 2,328 x Seaford 02 2,380 x Seaford 03 873 x Seaford 04 2,017 x Seaford 05 1,604 06/15 x Pt Elliot 01 2,475 06/15 x Pt Elliot 02 2,285 09/15 x Pt Elliot 03 1,642 08/15 x Pt Elliot 04 1,891 09/15 x Pt Elliot 05 2,001 10/15 x Pt Augusta 01 2,442 10/15 x Pt Augusta 02 2,369 11/15 x Pt Augusta 03 2,090 01/16 x Yankalilla 01 2,833 09/15 x
195. (NBN Co, 2015, pp. 4-7)
Page | 100 Economic and Finance Committee Table 3: Sites where fixed wireless services are classified as live.196 Allendale East Loxton Renmark North Arno Bay Lucindale Renmark South Balaklava Lyrup Stewart Range Balgowan Maitland Swan Reach North Barmera East Mannum Central Tailem Bend Berri Meningie Tarpeena Binnies Lookout Moorak East Tintinara Blanchetown Murray Bridge Waikerie East Clayton Bay Mypolonga Waikerie West Cleve Nangwarry Walker Flat Coonalpyn Naracoorte North Warooka Culburra Nene Valley Warooka West Currency Creek North Nildottie Worrolong Glossop Northern Heights Yahl Goolwa Owen North Yankalilla Green Acres Penola Yinkanie Hardwicke Bay Port MacDonnell West Yorketown Karoonda Port Neill Kongorong Port Victoria Kybybolite Port Wakefield
Table 4: Sites where fixed wireless services are classified as under construction.197 American River Eden Valley Nuriootpa West Angaston Emu Bay South Penneshaw Auburn Greenock Point Turton Barmera West Hamley Bridge Port Rickaby Beachport Central Kadina Redhill Blyth Kingscote Southend Bordertown Long Flat Strathalbyn South Brinkworth Loxton North Sunlands Bute Milang Tarlee Cadell Monash Truro Town Cape Jervis Moonta Waitpinga Cobdogla Morgan Wool Bay Coobowie Mount Horrocks Cooltong Mount McKenzie Corny Point Mundulla Crystal Brook Nepean Bay West Curramulka Nuriootpa North
196. (NBN Co, 2015, p. 22) 197. (NBN Co, 2015, p. 23)
Page | 101 Economic and Finance Committee Figure 1: Pictorial representation of the fixed wireless network in South Australia.198
198. (NBN Co, 2015, p. 21) Purple markers indicate sites where the network is classified as ‘live’, while brown markers indicate sites where the network is classified as ‘under construction.’
Page | 102 Economic and Finance Committee Table 5: Technology Upgrades Under NBN Co’s Technology Choice Program.199
199. (NBN Co, 2015, p. 28)
Page | 103 Economic and Finance Committee Table 6: State breakdown of ICT workers by industry, 2014 NSW VIC QLD SA WA TAS NT & ACT Industry divisions Agriculture, Forestry and Fishing 263 0 0 352 0 60 0 Mining 493 852 207 385 2735 0 164 Manufacturing 6,567 6,846 2,256 1,265 857 94 326 Electricity, Gas, Water and 3,062 2,740 1,945 537 1,243 109 167 Waste Services Construction 2,243 1,957 1,177 959 1,589 257 327 Wholesale Trade 7,739 6,584 1,441 1,255 964 0 414 Retail Trade 6,024 7,746 2,418 828 1,567 83 237 Accommodation and Food 210 670 0 246 0 22 0 Services Transport, Postal and 2,970 4,209 1,460 166 373 29 168 Warehousing Rest of Information, Media and 5,230 1,408 553 391 101 148 261 Telecommunications* Financial and Insurance Services 21,668 12,293 3,870 1,488 1,708 221 280 Rental, Hiring and Real Estate 970 236 824 619 249 78 0 Services Rest of Professional, Scientific 24,367 19,475 10,650 3,022 7,019 733 2,117 and Technical Services** Administrative and Support 4,163 2,593 1,524 293 269 65 351 Services Public Administration and 9,270 10,871 9,099 3,666 2,991 1,163 10,242 Safety Education and Training 5,919 4,588 4,542 2,210 2,891 334 817 Health Care and Social 4,998 3,139 3,557 520 1,012 330 557 Assistance Arts and Recreation Services 1,949 992 989 61 601 23 53 Other Services 3,800 2,463 1,429 547 734 129 281 ICT Industry Subdivisions Telecommunications Services 30,222 33,874 17,765 3,957 6,067 2,369 2,332 Internet Service Providers, Web 2,770 1,344 1,038 559 829 0 462 Search Portals and Data Processing Services Computer System Design and 70,683 55,083 29,679 8,577 14,413 1,529 6,350 Related Services Total ICT Workers 215,580 179,963 96,423 31,903 48,212 7,776 25,906 % ICT of total workforce 6.0% 6.2% 4.1% 4.0% 3.6% 3.3% 7.5% Source: ABS Customised Report (2015) * Excluding Telecommunications Services & Internet Service Providers, Web Search Portals and Data Processing Services which are separately identified as ICT industry subdivisions ** Excluding Computer System Design and Related Services which is separately identified as an ICT industry subdivision
Page | 104 Economic and Finance Committee Table 7: SA ICT employment forecasts by occupation, 2014 to 2020 Occupation Grouping 2014 2020 Average annual growth ICT management and operations 9,708 10,641 1.5% ICT technical and professional 10,465 12,770 3.4% ICT sales 832 1,349 8.4% ICT trades 4,731 5,229 1.7% Electronic trades and professional 202 205 0.2% ICT industry admin and logistics support 5,964 6,191 0.6% Total ICT workers 31,902 36,384 2.2% Source: Deloitte Access Economics (2015)
Table 8: State breakdown of domestic enrolments by field of education, 2013 IT undergraduates IT postgraduates Engineering Engineering undergraduates postgraduates NSW 7,301 1,860 15,996 3,936 VIC 6,081 1,680 12,600 3,121 QLD 4,611 813 14,591 1,498 SA 1,503 554 5701 994 WA 1,147 286 4047 760 TAS 329 66 915 168 NT 123 7 398 20 ACT 875 178 648 150 Multi 85 3 -- 2 Source: Department of Education u-Cube (2015)
Table 9: State breakdown of domestic completions by field of education, 2013 IT undergraduates IT postgraduates Engineering Engineering undergraduates postgraduates NSW 1,220 487 1,966 1,023 VIC 987 400 2,160 767 QLD 606 217 1,756 399 SA 254 156 923 274 WA 167 78 579 252 TAS 55 18 148 28 NT 9 4 24 0 ACT 151 59 96 25 Multi 14 4 14 4 Source: Department of Education u-Cube (2015)
Page | 105 Economic and Finance Committee Appendix 9
Local Council NBN Survey
The Committee prepared a survey, using the online program SurveyMonkey, to assess the levels of anticipation towards, and preparedness for the NBN among local councils. An invitation to complete the survey was forwarded to every local council in South Australia. A total of 19 responses was received from 18 councils. The questions and selected responses follow:
Q1. For our records, could you please provide the following information: Your name and position The council you represent
Q2. Does your council have a Digital Technology/NBN Strategy? Yes, we have published such a document No, but such a document is currently being prepared No, but we have plans to prepare such a document in the near future No, we have no plans to prepare such a document
Comments Written responses not shown
Page | 106 Economic and Finance Committee Q3. At what stage of the NBN rollout would you classify your council? Completed Nearly completed Commenced Yet to commence
Other (please specify) Written responses not shown
Q4. How well informed have you been kept by NBN Co in relation to the rollout in your council area? Very well informed Well informed Adequately informed Poorly informed Not informed at all
Comments Written responses not shown
Page | 107 Economic and Finance Committee Q5. How well informed have you been kept by the Commonwealth Government in relation to the rollout in your council area? Very well informed Well informed Adequately informed Poorly informed Not informed at all
Comments Written responses not shown
Q6. What proportion of council business presently utilises online services? Essentially all of our business A high level of our business Approximately 50% of our business A low level of our business Essentially none of our business
Comments Written responses not shown
Page | 108 Economic and Finance Committee Q7. How would your answer to the previous question (Q5) change after rollout of the NBN in your council area? Would expect it to increase Would not expect any change Would expect it to decrease
Comments Written responses not shown
Q8. Which areas within your council area do you anticipate will benefit from high-speed broadband? (Select as many as you think applicable) Tourism ICT Manufacturing Health Agriculture Education Business development
Other (please specify) Written responses not shown
Page | 109 Economic and Finance Committee Q9. Can you provide examples of businesses/organisations within your council area that are currently utilising high-speed broadband? Written responses not shown
Q10. Have you had any contact or support from the State Government in relation to the economic opportunities that might arise from access to high-speed broadband? Yes No
Comments Written responses not shown
Q11. How would you describe the current level of online usage among residents in your council area? Very high High Moderate Low Very low
Comments Written responses not shown
Page | 110 Economic and Finance Committee Q12. How would you describe the current level of online usage among businesses in your council area? Very high High Moderate Low Very low
Comments Written responses not shown
Q13. How would you describe the current level of online usage among community groups in your council area? Very high High Moderate Low Very low
Comments Written responses not shown
Page | 111 Economic and Finance Committee Q14. How would you describe the feedback, from those in your council area, concerning the level of anticipation towards the NBN rollout? Very high High Moderate Low Very low
Comments Written responses not shown
Q15. Do you expect your council itself to benefit from access to the NBN? Yes No
Comments Written responses not shown
Q16. Do you expect those in your LGA to benefit from access to the NBN? Yes No
Comments Written responses not shown
Page | 112 Economic and Finance Committee Q17. What barriers do you perceive are hindering peoples' usage of the internet? Written responses not shown
Q18. What programs have you in place to assist residents in your council area maximising their usage of high-speed broadband? Written responses not shown
Q19. What programs have you in place to assist businesses in your council area maximising their usage of high-speed broadband? Written responses not shown
Page | 113 Economic and Finance Committee Appendix 10
ACARA Digital Technologies Curriculum
Page | 114 Economic and Finance Committee Page | 115 Economic and Finance Committee Appendix 11
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