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Standing Committee on Infrastructure and Communications
10/03/2011
Role and potential of the National Broadband Network

CHAIR —I now welcome the representative of Dorset Council to today’s hearing and acknowledge that we appreciate the time you also gave us this morning on the inspection. Although the committee does not require you to give evidence under oath, I should advise you that the hearing is a legal proceeding of the parliament and therefore has the same standing as proceedings of the respective houses. We do not have a written submission from you, Mrs Mercer, but you might like to make an opening statement or short address and then we will go to the question and answer session. Thank you.

Mrs Mercer —I would like to commence by saying thank you for coming out to Scottsdale. We appreciate your time and look forward to another visit, maybe, one day. For those who do not know, Dorset Council is in the north-east of Tasmania. It was one of the first three areas to be piloted for the National Broadband Network rollout. The main area was Scottsdale, which is our municipal hub. The Dorset Council, once we found out and started talking to Tasmania NBN Co., decided as a council to take a very active approach in order to obtain the best benefits we could from the project. We took up and embraced the opportunity because, prior to that, within our community of Scottsdale the internet take-up rate was roughly between 18 and 22 per cent, which was one of the lowest in all of Australia.

We believe that the marketing and promotion of the NBN rollout within Scottsdale has provided a greater understanding of the potential benefits to users of the new technology. We had a dedicated person to liaise with all of the different business organisations who were coming into the township, to make it a very smooth operation, and we believe that worked very well for us. Our involvement commenced as early as September 2009 and, essentially, all of the people working on the project left around December 2010.

We undertook local forums where about a hundred residents turned up to ask questions about the NBN and to get further information because the knowledge that we had back then, it being a brand new project, was very small. So we took it that we needed to inform the community. Rightly or wrongly, we did not take any stance on it at all. It was something that was being provided to our community and therefore we just wanted to provide as much information as possible to the residents so they could decide how they would like to go about the opportunity. We had almost 70 per cent take-up of fibre to the home, which was an excellent result. Essentially, what we have done since then is work with different organisations and businesses to look at the opportunities both now and into the future.

That is not to say that we did not have teething problems throughout the rollout, but the project was very important to our area and to our businesses. In addition, on the economic development side, at the time we in the north-east were going through a significant downturn because our meat industry was closing down, so with the rollout we had probably over 200 people staying in our Scottsdale township and buying things. So, for our small businesses, that was a very welcome addition to their year.

We have not only been part of the pilot for the first site but have also participated in e-health and e-education opportunities and projects. We are also currently working on a project with the federal department to look at an e-services garden portal which will be provided by council for our community. It goes into things like business directories; hosting other local community groups; local attractions and events and e-trip activities. So people who are looking at coming to our community can go online, download this application and, for instance, say, ‘Okay; I am driving from Launceston to Lilydale; what are the different things along the way that I can stop and have a look at?’ It will also have forums, garage-sale trails, e-farmers-market type things, virtual museums and, of course, council services.

CHAIR —Thanks, Ally; that is very interesting. Thank you also for creating the opportunity for us to speak to the local businessman, a chemist, whose business I understand was the first to go onto the NBN. Of particular interest, given the terms of reference for our inquiry, are the sorts of matters you have alluded to at the end of your presentation. It appears to me that council is driving a lot of these initiatives, and you talked about e-health, e-education and e-business opportunities. Can you give us some feedback and ideas from your perspective on how well resourced councils might be in general to do that? Are there others in the community who are well-positioned so that, with some government support, they could take perhaps more of a role in that area? What sorts of things might you see that government could usefully do? Obviously we are particularly keen to hear about how people would be supported to take up the sorts of initiatives that you are talking about.

Mrs Mercer —From our point of view, having gone through this process for the last year and a half or so, there were and still are no resources, really, to do with the NBN. We were slightly disappointed that there was not a dedicated liaison officer for the NBN. There is now, which certainly assists in the communications side of things for the next seven projects and townships. When it comes to looking for counsel, from my knowledge of what is going on, certainly in the north of the state, all of our groups—the sustainable development group people or the economic development group people—get together, and we have had many discussions about the rollout and how it might affect each one of the councils, but they do not have dedicated resources and they are wondering how they are going to manage the rollout for each of their townships.

CHAIR —So if I own a business in one of the townships in your council’s area and am interested in maximising my use of the technology, would council generally be the first place I might go for some advice? Do you have any feedback from businesses about where they are going for that advice and information?

Mrs Mercer —Yes. Essentially they come to us first. Also another group that we have in Dorset is called the Dorset Economic Development Group. With the two of us, we give as much advice as we can. There was a program called NBN4Business which was rolled out by the state government, I believe, and they provided seminars to businesses throughout the state. From the feedback that I received from businesses in my area, it had mixed success and in fact the session we were supposed to have in Scottsdale was cancelled.

CHAIR —From the broader community, I remember we got some evidence from you in the field today that Scottsdale is a high aged population community, with that rate of ageing increasing. What is your experience as a council with the aged community engaging with the NBN and its opportunities?

Mrs Mercer —The aged population is quite high, with over 40 per cent aged 55 and over, and it is growing at a very fast rate. As a council, part of our strategic plan is to look at the north-east as an aged-care centre of excellence. We have very high standard health activities there for the aged and, from my experience in talking to the seniors groups in the townships, they are very much wanting to take it up. That surprised me at the time, because you just think of the internet and this type of activity as a young person’s thing. But there are a lot of our older people skyping their children all over the country and so forth.

CHAIR —Along that line generally, who would be working with those demographics? Would senior citizens clubs perhaps be running it? Do you have any of the Broadband for Seniors kiosks running in the area?

Mrs Mercer —No, we do not at the moment. We have had that opportunity but unfortunately the main area where our facilities are is not in fact connected yet with Northbourne, which are our independent living units. There are 65 of those in our township. They are not connected yet, so we have not really gone down that avenue. It is considered something that we would like to do in their community hall area.

Mr NEVILLE —What has the impact been on your own council from having the NBN? Have you dispensed with all your Telstra services? What is council’s initial reaction to it and what advantages have you seen in the early stages?

Mrs Mercer —As a council we have not actually connected fully up with the NBN. We are still—

Mr NEVILLE —You are still on ADSL?

Mrs Mercer —Yes, we are still with Telstra and that is due to contracts that we have.

Mr NEVILLE —What speed are you getting from Telstra?

Mrs Mercer —It is an ADSL2 speed and it differs throughout the day.

Mr NEVILLE —What would you expect to get most of the time?

Mrs Mercer —About 20 megabits.

Mr NEVILLE —You were saying that 70 per cent of people have agreed to take on the NBN. By that I presume you mean the junction boxes to the houses?

Mrs Mercer —Yes, fibre to the home.

Mr NEVILLE —Is it also true that only 15 per cent have actually engaged with a provider?

Mrs Mercer —I am not privy to that information. I do not know how many have actually taken up with a retail service provider.

Mr NEVILLE —I am told 15 per cent. You have not heard that figure?

Mrs Mercer —No I have not.

Mr NEVILLE —If it is true then there is still a big gap between 15 and 70. I suppose if you do not know then it is pretty hard to comment. Let us go to the other end of the scale. On the 30 per cent who do not even want the facility attached to their home, what was the basic objection that those people had to the NBN? Is it that they just did not want internet under any circumstances or were they angry in some way? What would possess 30 per cent to not want to engage in any shape or form?

Mrs Mercer —From the information that I have received from those people—it is certainly not the 30 per cent; I cannot talk on those people’s behalf—who did not take it up, it was because of the lack of information and knowledge to really understand what they were signing up to at that point in time. I can say that I still receive probably one and maybe two phone calls per week from people who did not take it up but who now seem to understand more about it or have read up about it and are now looking to have it onto the their house. All I can do is refer them on.

Mrs PRENTICE —Going forward, what services do you see the council delivering to your residents?

Mrs Mercer —With the e-services garden portal, we would like to be looking at things like development applications online where people can track where their DAs are. There are longer term things like cemetery information, which is certainly one of those fields that a lot of councils are looking at having, and just being able to provide e-services and e-payments. We have a third party for getting bills paid online, but we would like to be able to have that facility ourselves later down the line.

Mrs PRENTICE —Do you see that as saving the council money?

Mrs Mercer —Yes, we do, because people can then be self-sufficient. Certainly within the development application area people will be able to go online and look at where things are at. Therefore, it will save the time of the person ringing the council to get that information.

Mrs PRENTICE —Do you need NBN for that or is it just really an IT product for the council?

Mrs Mercer —The NBN will certainly provide more opportunities to utilise that type of application. Those types of applications are certainly on the mainland—in Melbourne, for instance—but they have limitations on what you can download and the types of activities you can use. We believe that with the greater upload and download the application can be extended.

Mr FLETCHER —When did Dorset Council first learn that Scottsdale was to be an initial site for NBN?

Mrs Mercer —I think it was sometime between July and September 2009.

Mr FLETCHER —So it was not on the basis of a proposal or a submission the council made.

Mrs Mercer —No.

Mr FLETCHER —You were just notified of that.

Mrs Mercer —We were, yes.

Mr FLETCHER —Do you know whether that decision was made in Hobart or in Canberra?

Mrs Mercer —I believe it was in Canberra.

Mr FLETCHER —What have you been told about when the areas that are not served now by the fibre network will be connected?

Mrs Mercer —The townships or the residents?

Mr FLETCHER —I mean outside the existing fibre footprint. For example, you talked about some aged care homes that are not within the existing footprint. Do you know when those areas will be connected?

Mrs Mercer —At Northbourne, which I was talking about, they are in the footprint. They are currently looking at how the work can be done in a way that is sympathetic to the area, because it is all beautified gardens and those sorts of things. They are working through that. We still have a lot of area in the north-east that will not get fibre to the home. The only options for the smaller towns are wireless or satellite. There were a lot of discussions within the community about who is going to get the fibre and who is not and why we cannot have it when we see the backhaul line right next to our window and those sorts of things—expectations. A lot of our communities will not get any sort of upgrade for quite a few years.

Mr FLETCHER —Can we talk for a moment about the kinds of benefits that Scottsdale has obtained from the NBN. Can you identify any new businesses that have started up because they now have high-speed broadband?

Mrs Mercer —Yes. We have had a few businesses that have actually moved to Scottsdale purely because of the NBN.

Mr FLETCHER —What kinds of businesses are they?

Mrs Mercer —They are computer companies, small niche businesses. One that I am aware of and that we discussed this with comes from WA. Another one was from Sydney. He is a graphic artist. His partner also came down to the area and he kept his business going knowing that he could have the same access to what he was used to in Sydney and even better.

Mr FLETCHER —Do you think you could put a figure on the number of jobs or businesses that have been created?

Mrs Mercer —No. I think it is still too early. One thing that Dorset Council is currently doing is working on a business innovation centre with the focus on NBN connectivity. We believe that the small to medium sized enterprises within our community and outside will be interested in coming to Scottsdale, certainly for lifestyle and liveability but also because they do have this internet access and all the IT type activities that you can get.

Mr FLETCHER —What broadband services were available before the NBN arrived?

Mrs Mercer —There was a certain level of ADSL but a lot was still dial-up.

Mr FLETCHER ——How close to town was the closest dial-up location or were there people in town who could get only dial-up?

Mrs Mercer —People in town were still using dial-up.

Mr FLETCHER —Do you think that the uniform availability of broadband is the biggest selling point or is it the speed? Fifteen per cent of people have now connected. What was it that got them to connect?

Mrs Mercer —Choice. What came up time and time again is that, prior to the NBN rollout, there was literally only one choice of service provider and therefore our residents thought it was a good opportunity to be able to have some more players in the field.

Mr FLETCHER —What is the view of the community about the fact that the Telstra network will be shut down? 

Mrs Mercer —I have heard nothing within the community of any fears of the copper going from houses and those sorts of things.

Mr FLETCHER —What is the lowest cost package that is available in Scottsdale for the NBN—in other words, the lowest cost retail package that is being offered?

Mrs Mercer —I cannot tell you; I do not know. I do not know, because I do not live in Scottsdale. I live just outside Scottsdale; therefore, I do not get the NBN or fibre to the home.

Mr FLETCHER —You stated that a graphic designer has moved to town. Can you talk about any telemedicine applications that are underway?

Mrs Mercer —We were part of an e-health trial with Hunter Health. I think they were down here working with us on that for about seven or eight months. We are hoping to have more discussions with GP North and, once they have their new premises up and running, we are hoping to work with them on some e-health activities.

Mr FLETCHER —So there is nothing specific at the moment?

Mrs Mercer —No.

Mr FLETCHER —How did the planning work for the telecom facilities that have been built as part of the NBN in Scottsdale?

Mrs Mercer —When we found out that we were going to be one of the first three sites we then had contact with NBN Co. Tasmania and Aurora and another group within that group. They came into the council and said, ‘This is where we’re going and this is what we need to do. What’s the best way to do that?’ We walked them through the whole process. From a planning point of view, it was quite easy. We had difficulties with the digging within the streets and everything else. Each time, say, Aurora had to dig a hole they had to get permission. That was quite clunky to begin with, because we would get a call, ‘We want to dig a hole.’ We would say, ‘We have other things we have to do. We can’t just be at your beck and call.’ We worked that out very quickly. At least a week or two in advance they would tell us the work they were going to do, we would give the approvals and it was all smooth sailing after that.

Mr FLETCHER —As a legal matter, do you know whether the project was approved for planning purposes by the council or was it approved at another level?

CHAIR —You can take it on notice.

Mrs Mercer —Can I can take it on notice. Certainly, with the actual fibre going down—the backhaul line and that sort of stuff—there was an approval process that went through. But I do not know whether it was discretionary or it went to council. I can provide that information later.

Mr SYMON —In your opening statement you spoke about the take-up—18 to 22 per cent—of internet, prior to the NBN rollout. I have several questions around that. Was that a matter of choice? Was it a matter of cost? Was it too expensive or was it more a question that people were not aware of or did not want any form of internet service? I am trying to understand why it is such a low figure.

Mrs Mercer —I can only speak generally. I believe that, from the discussions we have had with different community groups—and I have spoken to probably 10 different community groups over time—cost was a very big factor because at the time there was only one service provider and the cost was a great deal more than what you would pay in the city.

Mr SYMON —What was that cost?

Mrs Mercer —For instance, some people claim they were paying $89 a month, say, for one gig per month download, whereas if you were here, say, in Launceston the cost would be $29.

Mr SYMON —That is a substantial difference. As you mentioned, there is an older demographic. My own electorate has an older demographic and many of them are great users of the internet. Is there some other reason other than cost and demographic that means that, up until now, there is a lower take-up of internet services?

Mrs Mercer —No. We could not work out why it was so low. These are just statistics from the census that we have obtained from the Australian Bureau of Statistics. We do not know why the number was so low.

Mr SYMON —Following on from that—and I know you do not know this figure—but 15 per cent was quoted as take-up of the NBN. It is quite close to the take-up figure of what you had before the NBN rollout. I suspect, as you mentioned in answer to a previous question, the more people find out about it the more people will want to use it, whether it be from a price angle or from a what is available type of angle. What can the government do that tells people in the community what is on offer, how they can use it and what a difference it will make or how it will change or open a window in their lives that they are not necessarily aware of? 

Mrs Mercer —In the discussions I have had over probably 15 or 16 months with our residents it has always been a case of it not being in a language that they understand and quickly comprehend. So with respect to this whole thing of signing up—you have two, three or four weeks to sign up—many of them do not understand what it means. I received many phone calls at the council. People would ring me and ask: ‘Does this mean I have to have the internet?’ I would explain to them what the box would mean and just left it at that. It was entirely up to them what they wanted to do. That is all we could provide. I would have liked to have seen, certainly for our area of Scottsdale, more of an emphasis on the activities that would be going on and what it meant to be getting this box on the side of your house and more education in a way that was in very simplified speech patterns. Even with some of the letters that went out you would sometimes have to look up in the dictionary to see what a particular word meant. I think I am quite an intelligent person but—

Mr SYMON —I appreciate that. One of the problems I think all governments have is communicating. When we start to talk about technical terms and issues, many times we may go over some people’s heads. Did the council manage to put out the information you have just described in writing or was it always done as a verbal fill-in of information? If you had a simplified information booklet that you sent out that would be useful, but it would also be useful for all the sites that are coming up.

Mrs Mercer —We provided NBN Co. with a lot of the documentation that we prepared in plain speak: what it meant and what people would be signing up for. We used the North Eastern Advertiser, which is our local newspaper. That has an 80 per cent readership within our area, so we knew we would be getting out there. Often we tried to get the message out there that this was going on. Whether or not people took it up was entirely up to them.

Mr SYMON —Would you be able to provide the committee with a copy of the simplified documentation that you referred to?

Mrs Mercer —I am sure I could, yes.

Mr SYMON —Thank you very much.

CHAIR —I do not know whether you would hold this information at council, but it would seem to me that if people did not put the infrastructure in it could be a resale issue for them. I wonder whether you have had any feedback. I know it has been a short period of time and there may not have been a great turnover of households, but have you had feedback from local estate agents and so forth about whether there is an issue if you are connected or not.

Mrs Mercer —The local real estate agents were somewhat involved in community types of activities and they said to people who asked them essentially, ‘Sign up to this because, even if you do not use the internet, it is a great thing when selling your house.’ Whether or not that is right or wrong, it was up to them to talk about, but they saw it as a distinct advantage to have this box on the side of the house for their resale value.

Mr NEVILLE —Given the amount of criticism when the coaxial cable was strung from pole to pole in Sydney, Melbourne and parts of Adelaide, what was the reaction to stringing the fibre-optic cable from the telegraph and electricity poles? Was there any community reaction to that at all?

Mrs Mercer —No, not for our community at all. When we did the first forum we had about 100 people there and we showed them the size of the cable and explained exactly where it would go on the poles or underground. Our community did not have any of that at all. The newspaper did a story about the very first house that was connected and the line that was going to the house and the box. I have that here for you today. It shows the first box going onto the house. More people did sign up after they had seen that as well.

Mr FLETCHER —I want to make sure I am understanding correctly what you are saying about the economic benefits that the town has seen. You mentioned that a couple of people in the IT sector have moved into the town from other parts of Australia but, for example, there is nothing specific going on right now in terms of e-medicine. Are there any other tangible economic benefits you would point to right now that the town has achieved as a result of the NBN coming?

Mrs Mercer —When I was talking about the economic development side of things, it was the short-term benefit to the community of having over 200 people living, eating and breathing in our community. That assisted the shop owners to keep open because we were going through an extremely tough period because tourists do not come in winter. It certainly helps our community survive.

CHAIR —But it is too early to tell about the longer term, is it?

Mrs Mercer —It is too early to tell. I did mention the business innovation centre. From discussions we have had with possible businesses they see that as a very positive step. We are working very quickly to get that up and running to then establish small- to medium-sized enterprises within our community with the focus on both the NBN and the food niche business, because we do have a very strong agricultural bent in the north-east and we believe the two together will be able to provide opportunities.

CHAIR —Thank you for your attendance today. If you have been asked to provide additional information, just forward it through to the secretary. You will receive a copy of the transcript of your evidence.

[2.10 pm]