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National Broadband Network, NBN: Red faces, Red-tape, Red-herrings and Red-ink 

Issue: Issue 82: May 2009
Author: Pat Gallagher

I can understand that some of us will see the recent "back-of-an-envelope", announcement for a NBN as exciting. 
I don’t.
I see it ending badly unless someone does a whole lot more homework on the numbers.
Reference is frequently made to this plot being “bigger than the Snowy Scheme”. 
Maybe so - however a large Snowy Mountains committee spent two years doing the sums before that go-ahead was made.
Here we had a few politicians and some "Yes Ministers" do the deed apparently, over a few days, during a couple of aircraft flights!
The next thing we could hear is that Mr. Kehmlani is on his way back to fix up the funding!
Well certainly there is an ‘f’ and an ‘up’ lurking in there somewhere.
Red faces all round is the likely mid-term outcome.

The other factor is the boring bit.
All I have read recently centers on the cost to a ‘working family’ household for social and entertainment use.
As in “will they pay $100 a month”?
Which in itself is a question within a question; who knows if the cost will turn out to be $100 or $150 a month?

Meanwhile the subject of red tape and business use is pretty boring and barely gets a mention.
Yet, we exchange 2 billion invoices on paper at $50 a pop with an e-version replacement at a mere $2 a time.
And a fully installed e-health system will save $100s of billions and will also save unnecessary medical misadventures that too often result in death.

So, where the household cost is a matter of spending money the business opportunities introduce a factor of saving money.
And, by and large, the savings are on offer RIGHT HERE AND NOW

The present internet infrastructure is capable of delivering huge benefits in e-enabling paper transaction processes that few people see, or on fact want to see. 
This is because the subject is tedious, boring and strangely invisible to decision makers.
That subject is our persistent reliance on a paper form for transactions that should have been e-enabled long ago; two of which are invoices and prescriptions.
Both have huge numbers of transactions and both impact mightily on the national economy.  
Paper invoices are a particular waste of productivity and a cost burden that remains largely ignored.

This poses a question. 

Should we in Australia rush to spend tens of billions with little in the way of a (NBN) business case, or should we first start by saving business and government and the national economy, $billions in Dad ‘n Dave paper shuffling costs?
With invoicing a social revolution is needed in back office productivity with a leveling of the EDI playing field for the universal distribution of the financial benefits to all who can use electronic platforms in the name of national productivity.
While no one disputes the promise benefits of e-health, amounting to hundreds of billions; our "pollies" are doing what?
Nothing much and they are doing that little bit badly as well.

I refer to, of course, the recent launch of two (with a rumour that more are to come) e-script hubs.

As we discussed last month this preempting of the e-health governors is an example of the market doing a better job ahead of waiting for those asleep at the wheel to do their jobs.
Therefore while we can build an improved network platform over the coming years I think it far better that the government spends money implementing change for those applications that can be converted to warp speed today, without spending $48 billion of OUR money on a political whim of a good idea ‘at the time’.
Imagine if we become so successful at e-health transaction volumes (and accounts payable and receivables) that it becomes apparent that we do have to upgrade capacity, speed, access or whatever; well then, fine.
This is by far a more natural way to build infrastructure – underpinned by and from current savings, on applications that have proven their worth to the nation.

What would make more sense is to create an e-conversion task force of some kind to start changing our habits right away.
This body will also have a brief to build the case to spend the money to build on the present internet infrastructure, over time.
After all we do have an existing infrastructure, including lots of cable, and I ask myself – “do we need two parallel hubs?”

Strikes me that we are repeating the cable fiasco where Telstra laid cable in the street and Optus hung the cable on poles.
Does anyone know what is proposed for the NBN?
Does the back-of-an-envelope business case call for underground pipes or air swings?
Or, dare I say, wireless.

This is crazy stuff, made all the more maddening because these red-herring type decisions involve spending OUR money.
If we had a proper task force/council structure in place, a great deliverable from them would be an awareness campaign. Delivering some form of a collaborate message that is elegant in its simplicity that encourages the business take up TODAY of broadband use rather than posting paper envelopes and faxing paper forms.
This will go a long way to reaching closer to the illusive paperless office while all the while building the case to act on whatever is needed to make our e-commerce capacity and capability functionality grow to meet demand.
In this way the whole economy will move to a better footing and risks to the taxpayer will be minimized.

Spending other people’s money is one thing, doing it badly is even worse.
Whatever your point of view we will all benefit if transactions are more visible and electronic, but not necessarily so if it is just how long we take to download a movie.
What if, over the next ten years, new technology emerges that make today’s decisions to roll out fiber, proves to be overkill and we end up with an outdated white elephant?
It would make more fiscal sense to invest firstly in the use of a here and now national electronic transaction platform, ahead of any rushed rhetoric-based policy to build an asset that could become a just a taxpayer burden.

Or to use this rhetoric of the politicians – we should avoid the risk of - “building an Electronic Snowy Scheme and then find out there is no water to drive it”.

Red faces all around one would think.

Much smarter to share benefits now, to clearly demonstrate why a properly thought through NBN infrastructure is important, and all the while delivering shared savings to offset costs, without the need for the public to underwrite all of the risk.
Remember Rex O’Connor?
Seems to me the present mob has whitewashed that fiasco from the collective memory and it might help if they suddenly recalled that the past teaches us prudence.  

The ‘build-it-and-they-will-come’ mind-set of the NBN supporters is a just a big-government vision-thing.
Certainly the enterprise ROI and social value case increase tremendously if the focus and interest is on health informatics and health records for example, rather than just social networking and entertainment.
To make the economy operate in a practical and better way in the relatively short-term makes sense, albeit that the subject is ever so boring compared to the Whitlam-like grandeur so loved by the commenteriate.

By comparison we can be prudent and visionary so as to minimize the red ink risk by saving and paying in unison to build infrastructure. Rather than blow our kid’s future debt requirement on flawed politics that has seemingly little in the way of planning in place.


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