Senator the Hon Helen Coonan
Minister for Communications,
Information Technology
and the Arts
Deputy Leader of the Government
in the Senate
A Blueprint for Broadband in Australia
Address to Australia-Korea-New Zealand Broadband Summit
Adelaide
7 December 2006
Thank you and good morning. It is a pleasure to be here for the third Australia-Korea-New Zealand Broadband Summit.
I welcome the Minister for Communications and Information from Korea, the Honourable Jun-hyong Rho; the Minister for Communications from New Zealand, the Honourable David Cunliffe and the Honourable Karlene Maywald, Minister for Science and the Information Economy, representing the South Australian Premier.
Introduction
In Seoul last year we agreed that these Summits should be an annual event because of the enormous benefits they offer to companies and research bodies in our respective countries.
There is much we can learn from each other.
While there are obvious differences between our countries, we are all moving quickly to provide our citizens with access to high speed broadband.
And, of course, the companies and research bodies in each of our countries all aspire to becoming world leaders in the effective use of broadband.
Our role as Government is to play a facilitating and coordinating part in the rollout of next generation infrastructure.
Our role is to ensure that all of our citizens, companies and researchers can access broadband and the technologies that can make a difference to our lives.
For these are the technologies that will underpin our future economic and productivity gains; the technology that will transform our entertainment choices; will enable us to access health and education services wherever we live, and the technology that has simply transformed the way we communicate with our loved ones and the broader global community.
I think the central purpose of this summit is to share our individual experiences in facilitating access to technology for the benefit of all three countries.
Shared experiences
New Zealand and Australia share many similarities –varied geography, relatively small and scattered populations and a passion for sport.
I would add to that a propensity for punching above our weight on the world stage.
And New Zealand, like Australia, is grappling with the question of how best to connect a country with geographic and demographic challenges.
I note with particular interest Project Probe which is endeavouring to roll out broadband to New Zealand’s provinces.
Australia has similar programs in operation and will shortly announce successful applications for our Broadband Connect infrastructure program.
I am sure there are many experiences that our two countries can share and that we can benefit from further dialogue about these initiatives during the summit.
And Korea, particularly in the field of ICT and broadband, is an exemplar on the world stage.
Korea is currently ranked fourth out of 30 countries in the OECD for broadband take-up and has made a significant investment in a national fibre-to-the-home network.
The contribution of ICT to Korea’s economy is the envy of many in the OECD and I am sure that many in attendance at this Summit will be keen to learn from the experience of the Korean delegates.
I look forward to meeting with my counterparts from Korea and New Zealand following my address today so we can further foster collaboration and information sharing between our countries.
Critical infrastructure
Broadband is fast becoming critical national infrastructure in Australia and some suggest it will very soon be labeled as a fifth utility, after roads, water, electricity and gas.
We are also having a very healthy debate in Australia about the true state of broadband here.
As Communications Minister I am not short on sources of advice on how best Australia can connect to fast broadband.
I naturally am pleased to listen to debate about public policy issues in this country but I have also called for a dose of reality to be injected in the broadband debate in Australia.
Australia is neither a leader nor a laggard in broadband. We are above the OECD average for broadband take up, and second in the OECD for growth in broadband take-up.
Our ranking of 17th in the OECD for broadband take-up is on par with Australia’s OECD per capita income ranking and it must be considered in the context of Australia’s low population density relative to those higher ranked countries.
Australia can often be slow to take-up technology but – like with mobiles and dial-up Internet – once we latch on to a technology, we begin to adopt it with increasing frequency.
An Australian Bureau of Statistics survey conducted in March 2001 found that 96 per cent of Australians accessed the Internet through dial-up services.
Now, five years on, it is all about faster Internet services, with 71 per cent of Australian Internet users now connected to broadband.
Broadband is helping Australians find information, stay connected, do the banking, and buy just about anything you can think of, from anywhere in the world.
Nationally, just under 12 million Australians used the Internet (broadband and dial-up) in the 12 months to June 2006, and 80 per cent of these performed multiple online transactions.
Country users are also benefiting from increased broadband availability.
The number of home Internet users on broadband in regional areas has increased by 61 per cent in the 12 months to August 2006.
In metropolitan areas there was a 43 per cent increase.
It is estimated that 73 per cent of Australia’s 1.2 million small businesses now use broadband (as at June 2006), and 19 per cent of small businesses are using VoIP to lower business costs (as at September 2006).
Clearly every effort must be made to ensure that all Australians can share in the benefits that broadband can bring.
I agree with a report from the Committee for Economic Development in Australia released this week that shows ‘there is no broadband crisis’ in Australia with more than 90 per cent of the population having access to multi-megabit broadband.
I also agree with the report’s conclusion that there is no ‘one size fits all’ solution for Australia’s broadband - I’ve said this repeatedly and will elaborate on this later in my remarks.
I would like to share with you today some significant movements in the Australian communications landscape since we last met in Korea last year.
I will also outline how the Australian Government is playing a leadership role in Australia’s evolving broadband story by formulating a national strategy for broadband rollouts.
A new telecommunications landscape
A lot has happened on the Australian ICT and communications landscape since I last spoke to the Summit in Seoul last year.
The biggest change on the Australian telecommunications landscape since the last Summit has obviously been the privatisation of our largest telecommunications provider – Telstra.
T3, as it is referred to, was a great success.
The final public offer of Telstra shares has concluded successfully, with 4.25 billion shares allocated and a final institutional price of $3.70 per share representing a total offer of $15.5 billion.
The remaining shareholding of around 17 per cent will be transferred to our Future Fund - a purpose built fund in which the Government will invest to meet our future superannuation liabilities.
The Future Fund will also receive all of the proceeds of the sale.
The level of interest from investors, both retail and institutional, was much higher than expected, making T3 the second biggest share offering in Australian history.
The Government’s sale team managed the T3 process extremely well and designed an offer which proved to be highly attractive to both ordinary investors and investment funds.
The Government privatised Telstra because we believe it is in the best interests of both Australian taxpayers and Telstra shareholders.
There was an inherent conflict of interest in the Australian Government remaining the largest shareholder of the dominant telecommunications provider and the rule-setter for the entire telecommunications industry, which now has more than 150 providers.
It has been a long journey to achieving the telecommunications landscape Australia will now enjoy.
But we have not wavered from the fundamental building blocks that we believe are vital to deliver Australian consumers the services they need at a price they can afford.
Those fundamentals include a stable, yet responsive regulatory framework and supporting competition as a key driver for lower prices and more choice for Australian consumers.
And where the market will not go, the Australian Government will provide targeted funding to ensure all Australians can access vital telecommunications services, regardless of where they live.
The diversity in Australia’s telecommunications market and the continued rollout of fast broadband in Australia from a number of providers is a direct result of the pro-competitive and technology neutral approach that the Government has adopted.
The flip-side of the full privatisation of Telstra is that the Government can focus on investment in telecommunications services for Australian consumers both now and into the future.
Following the passage of the sale legislation, I also secured the $1.1 billion Connect Australia package and the $2 billion Communications Fund.
Connect Australia
This is the single largest investment in telecommunications services in Australia’s history and comes on the back of a billion dollars already invested in rural and regional Australia.
Connect Australia has four elements:
- the $878 Broadband Connect program to push fast broadband out to areas that can’t access it;
- the $113 Clever Networks program to provide high speed links for our universities, hospitals and research institutions;
- the $30 million Mobile Connect program to further improve mobile phone coverage; and
- Backing Indigenous Ability which will ensure remote Indigenous communities can access vital telecommunications and broadcasting services.
There are linkages to be found across all of these programs.
The Government is currently seeking applications for grants under the infrastructure element of Broadband Connect.
Up to $600 million will be allocated for some large scale infrastructure projects to push out the reach of high speed broadband to the regions and beyond.
The objective is to provide in a variety of ways, end to end national broadband solutions.
We will continue to be competitive neutral in the grant allocation process as well as technology neutral.
We recognise that in a country as large and varied as Australia, a mix of technologies will be needed to deliver the best communications solution.
The grants will be allocated this financial year and I am looking forward to seeing what innovative proposals will come forward as part of this process.
A strategic approach to broadband
Countries across the globe are grappling with how best to connect their communities to high speed broadband.
Australia is by no means alone in our quest to encourage the rollout of next generation networks.
I mentioned Korea’s status as a world leader in the use of ICT in its economy.
This has been facilitated by the rollout of fibre to the home – at a substantial cost. I also note the recent introduction of WiBro – wireless broadband.
The combination of Wi-BRO and satellite digital multimedia broadcasting allows the delivery of interactive television services as well as access to the Internet.
I also mentioned New Zealand’s efforts to connect its more remote populations outside the metropolitan centres.
Rather than trying to emulate any one particular country’s experience, I have spoken of encouraging Australia to carve out its own broadband story.
One that is relevant to our geography and demography and one that continues the competition and technology neutral approach that has served us so well.
Australia’s broadband story must also recognise that all tiers of Government, as well as industry, has a role to play in our broadband story.
The Queensland, NSW and Western Australian Government have all recently announced plans to enhance broadband availability to their individual jurisdictions.
The Queensland Government has announced that it will open up access to State and local government utility assets and easements for industry to utilise in a fibre network roll out in Brisbane.
And just last week the New South Wales Government announced it plans to install a free wireless broadband network throughout the Sydney CBD and other major centres by early 2008.
And industry too is playing its part.
There are now fourteen providers that are offering ADSL 2+ technology and Telstra recently turned on its ADSL 2+ in selected exchanges across the country.
Telstra also recently invested heavily in the rollout of its Next G network which covers 98 per cent of the population.
Next G will provide 3G mobile phone coverage to the majority of the Australian population and will also provide them with a wireless broadband platform to service consumers who have difficulty accessing ADSL.
To harness this investment and ensure there is a coordinated and strategic approach to the rollout of next gen infrastructure I proposed some time ago the formation of a Broadband Blueprint for Australia which I am releasing today.
The Blueprint has the input of my State and Territory counterparts working through the auspices of the Online Communications Ministerial Council.
It is an overarching document that provides a national framework for the future of broadband in Australia and details areas of strategic importance for Australia by all levels of government and the private sector.
The Way Forward
Australia is already on a path to becoming a world leader in the effective use of broadband.
To ensure continued advancement on this path, particularly to meet the needs of Australia’s burgeoning broadband economy, government policy at all levels must support three essential elements of a competitive broadband market.
- The first is the promotion of scalable broadband infrastructure, which is able to move with the ever-changing needs of consumers.
- The second is the creation of compelling content and services that can be delivered over these networks.
- And the third is to ensure effective use of broadband by both consumers and the industry who must manage the networks to their maximum potential.
For at the end of the day, it is how broadband is used that provides the greatest economic and social benefits.
The next steps taken by governments and the private sector will be the key to achieving this objective.
The private sector will continue to be the major driver of broadband investment but all levels of Government must take responsibility for providing leadership and facilitating the delivery of real broadband.
The Australian Government will be undertaking a range of activities to stimulate broadband infrastructure availability which are outlined in the Blueprint.
These include ensuring adequate spectrum availability, mapping infrastructure and working with all tiers of government and industry on encouraging next generation broadband network deployments.
We will also maintain a stable and effective regulatory environment to promote robust competition, award Connect Australia funding in 2007, and conduct an awareness campaign on consumer opportunities for broadband use.
Most importantly, the Australian Government will work closely with State, Territory and Local Governments to streamline initiatives to avoid duplication and to encourage the best climate for investment in next generation broadband infrastructure.
This Blueprint is the first step and it will be updated as its plan is implemented. We still have much to do.
To ensure the Blueprint is effectively implemented, the Australian Government has invited all tiers of Government to work on an implementation plan for next generation broadband infrastructure investment.
This will be done under the auspices of the Online and Communications Council.
It is recommended that an OCC sub-committee be formed to coordinate a strategic approach across all tiers of government for industry investment in scalable next generation broadband infrastructure.
This then will be a practical means by which we can deliver scalable, national, end to end broadband solutions for Australia.
Australia now has a strategic national Broadband Blueprint – and the investment to back it – to help position this country among the world leaders in the effective use of broadband.
Instead of imitating countries that do not resemble Australia socially, economically or geographically, the Blueprint aspires to carve out Australia’s own broadband story.
It will assist to coordinate efforts across jurisdictions with clearly defined roles for Federal, State, Territory and Local Governments to meet the needs of end users.
Copies of the blueprint are now available from my department’s website.
Conclusion
Broadband is increasingly recognised as critical infrastructure and all levels of Government, as well as industry, have a part to play in its continued rollout in Australia.
While the Australian Government has primary responsibility for communications in Australia, there is a need for a collaborative and comprehensive approach to encourage the rollout of scalable broadband infrastructure.
The contributions of state and territory governments have been significant in advancing the interests of their individual jurisdictions.
Local government also has a role to play by using appropriate planning laws to support the deployment of next generation networks and identifying local solutions.
The Online and Communications Council will provide a focal point to stimulate industry investment in scalable next generation broadband investment.
For its part, the Australian Government will continue to provide leadership to shape Australia’s broadband future and will foster investment confidence through a stable yet responsive regulatory environment and targeted investment to areas of market failure and need.
I trust that participants will find the Summit useful and will also find good business and R&D developmental opportunities.
I urge you all to make the most of this opportunity and I look forward to hearing the outcomes of your discussions.
Thank you