The Public Policy Challenge of High-Speed Broadband
The failure of the National Broadband Network trial in Tasmania can be avoided
The National Broadband Network decision-makers, in choosing their initial trial sites, have made Tasmania an international laughing-stock.
In the inaugural sites of Smithton, Scottsdale and Midway Point, according to an NBN Co spokeswoman, about 50 per cent of premises have consented to being connected to the NBN. But of the premises connected, only 11 per cent have subscribed to the Internet services available.
The dismal take-up rate has much more to do with the choice of trial locations than it does with any national appetite for high-speed broadband. And it wouldn’t matter so much if the eyes of the nation weren’t so fixated on the Tasmanian results.
The lack of interest in signing up for high-speed broadband can be sheeted home to the government and NBN decision-makers picking the wrong places to shine the spotlight of public and political attention.
The trial was doomed to failure from the get go because the kinds of consumers who value and are willing to pay for high-speed connectivity don’t live in Smithton and Scottsdale. And not enough of them live in Midway Point.
The Tasmanian government’s commitment to social equity and inclusion is well known and respected. The choice of the towns in the northeast and northwest make perfect political sense. It demonstrates a willingness to bring critical infrastructure to rural and regional communities so frequently overlooked. And after all, the residents of Sandy Bay and South Hobart are already serviced by ADSL2 broadband.
Looking at the profile of Scottsdale the political decision appears inspired. According to the 2006 Census, Scottsdale’s main industries of employment are log sawmilling, timber dressing, and road freight transport. The median weekly household income is $697 compared to more than $1,000 for the country as a whole.
However, according to Social Intelligence Lab analysis using Roy Morgan Research data, less than half of all residents in the northeast are connected to broadband and only 6 per cent are interested in signing up in the next 6 months.
Compare that to Hobart where the intention to connect to broadband in the next 6 months is more than 50 per cent higher than in the northeast.
While the desire to bring broadband first to those who are least served makes perfect political sense, just don’t expect it to be any kind of test of consumers’ appetite for high-speed broadband. And certainly don’t use it as the litmus test for the national market.
The desire to connect rural and regional Australia to high speed broadband is not only sensible; it’s essential. It can be argued however that Hobart is a regional city and that trialling NBN take-up in small rural towns was just asking for trouble – the kind of trouble that comes when the state and federal opposition parties go looking for NBN failures. One in ten take-up is quoted nationally as a failure.
Wouldn’t it have been preferable to rollout the fibre to a regional city like Hobart with a significantly higher appetite and intention to sign-up for high-speed broadband?
The broadband potential in Hobart is a penetration of more than 60 per cent of the biggest population in the state. Surely that makes commercial sense, provides a true test for national uptake, and satisfies the regional agenda of the federal government?
The eyes of the world normally look upon Tasmania in awe and admiration. The NBN test site aberration can be corrected without abandoning the social policy imperatives.
