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Address to The Sydney Institute, [National Broadband Network].



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Address to The Sydney Institute

Sydney Monday 12 April 2010

Introduction - Reform Unleashes Transformation

Good evening everyone, it's a pleasure to be with you.

In the lead up to tonight's address I cast my eye over the speech I gave the last time I was here.

That was in May 2008 and the level of change that has occurred in that relatively short period is extraordinary.

My speech outlined the Government's plans for the media and telecommunications sector into the future.

In my view, no other sector is changing as quickly, or as significantly, as this one.

We live in a time where new technologies are transforming our daily lives and breaking down old barriers.

I wonder how many people in this room can't live without their i-Phone or blackberry, I have to admit, I have both.

We live in a time when threshold policy decisions made today, will have far reaching and transformative implications for the future.

As we move to the Digital Age, governments have a responsibility to drive and shape this transformation of the economy and society.

The Rudd Government has been bold in pushing ahead with necessary reforms, and policies, to put Australia at the forefront of the communications revolution.

There is no doubt that some of these reforms are difficult and some of them challenge special interests.

All of them will strengthen our economy, and improve the quality of life for all Australians.

Communications - NBN

Not so long ago, fast broadband was seen as a luxury item.

In the 21st century, it is becoming an essential utility service like water, gas and electricity.

It has the potential to break the tyranny of distance once and for all, but only if everyone has access to it.

The Rudd Government has made investment in high speed broadband infrastructure a top priority.

Just last week, I marked one year since the Rudd Government's historic announcement that it would establish a new company, NBN Co, to build and operate a new, wholesale-only, superfast broadband network.

The National Broadband Network is the largest nation-building project in our history.

It will transform our economy, drive future growth and productivity, lead to new innovative health services and help our children get the best education in the world.

Under our NBN policy, every home, business, school and hospital will receive high speed broadband.

No one will be left behind.

The NBN will connect 90% of premises with fibre-to-the-premises technology providing speeds of 100Mbps, and remaining premises with next generation wireless and satellite services that will deliver 12Mbps or more.

It will support 25,000 jobs every year, on average, over the life of the eight-year project.

The NBN will lift Australia to the top of world rankings in broadband access.

We will join leading countries in our own region—such as Korea, Japan and Singapore—that have prioritised investment in ubiquitous high-speed fibre broadband networks.

What we are doing here in Australia is being watched closely by other Western economies.

This includes the US and the UK which have both, since our announcement last April, developed policies aimed to put them on the path towards delivering high speed broadband of 100Mbps to their citizens.

One year on from our announcement, we have made significant progress on this historic project.

The physical roll-out in Tasmania commenced late last year, and the first superfast broadband services are due to begin in Tasmania from July.

On the mainland, the first building blocks of the NBN are already being put in place with 6,000 kilometres of optical fibre backbone being laid to 100 different locations in regional Australia.

Since the roll-out began in Mt Isa in February, over 400 kilometres have been laid and these investments are expected to directly benefit around 395,000 people.

NBN Co has also announced the five first release sites where fibre to the premise technology will be deployed on the mainland.

These sites will be used to test network design and construction methods and will provide crucial information to assist in the roll out of the NBN.

Work is due to begin on these sites in the second half of the year, with services available from early next year.

While the Rudd Government is getting on with transforming broadband services for all Australians, we are also getting on with delivering important complementary reforms in the communications sector.

As a wholesale-only network, the NBN will fundamentally transform competition and consumer choice in the communications sector.

We are committed to putting in place the necessary protections in legislation, including a wholesale-only network, to enshrine these principles.

Getting the structure of the communications sector right for the long term is a critical step towards unleashing the sort of competition that will benefit Australian consumers and Australian businesses.

It is reform that is long overdue.

It is a reform the previous Labor Government failed to achieve.

It is a reform that the previous Coalition Government ignored and exacerbated by privatising a vertically-integrated Telstra, without ever conducting a study into the long term effects on competition—despite repeated urgings from the National Competition Council.

The cost of these policy failures has been compounded in an age where telecommunications networks are much more than just about providing voice calls.

The NBN gets the market structure right for the long term.

But we cannot wait for that progressive eight-year rollout to reform the communications sector.

That is why we introduced, and currently have before the Senate, reforms to improve the structure and competition safeguards in the communications sector now.

This bill has been widely misunderstood as simply a bill 'about Telstra'.

While there are measures in this bill to address the unprecedented level of vertical and horizontal integration we have in the Australian telco sector, this bill has a much broader focus; and includes measures to improve other competition and consumer safeguards.

These reforms are essential in the long term national interest.

They will ensure that we have a competitive communications sector that delivers for consumers and business.

NBN and the Digital Economy

Building a National Broadband Network for all Australians — and designing appropriate regulations around the new and existing networks — is only part of the story.

What we do with it, and how we use it to enhance our everyday lives, will be most important.

Some critics continue to question whether Governments should invest in high speed broadband networks.

Others question whether we will in fact ever need broadband that delivers 100 megabits per second.

Critics also argue that the delivery of high speed broadband can, and should, be left to the private market to sort out.

A useful analogy to consider is - what if the same argument had prevailed in relation to investment in electricity networks in the 19th century?

Looking back, we now know that wide-scale, government-led, investment in ubiquitous electricity distribution networks created a platform that transformed economies and societies.

These investments generated benefits not only for the immediate impacts they had, but also on the transformation they helped create.

Last year, Glenn Fleishman's article, The Killer App of 1900, compared broadband in 2010 to electricity in 1900.

He said:

"A hundred years ago lighting was the killer app for electricity, the thing that made it worthwhile to have installed.

"No one particularly understood what else electricity might bring to the mass market…Compressors to allow refrigeration and freezing, electric heat and other innovations came later to homes."

He went on to say:

"We may think we know all the means to which high-speed internet access may be put, but we clearly do not: You Tube and Twitter prove that new things are constantly on the way and will emerge as bandwidth and access continues to increase."

Fast broadband will deliver more than just high-speed telecommunications.

• It is about better access to health services for Australian families; better education opportunities for Australians kids; creating new business opportunities and stimulating Australia's economy

• And it is about creating and keeping jobs in Australia.

Rural and regional Australia will have access to opportunities that until now, have been inconceivable.

The Chief Executive of the Tasmanian Farmers and Graziers Association Chris Oldfield has said, and I quote:

"For farming it will be revolutionary. "It will change forever what we do and the way we do it."

Mr Oldfield said the practical farming applications of the NBN could include:

• instant access to market and weather information • the ability to operate irrigators remotely • Or … 24/7 tracking of livestock through electronic tagging.

The task ahead in this new digital age...is to adapt to the changes, and take advantage of the opportunities it offers.

Regulation

The internet is the greatest transformation tool we have ever seen and the Rudd Government is ensuring Australia takes advantage of every opportunity it presents, through the NBN.

But while the internet is poised to become even more central to our lives, and much more accessible — can it remain largely unregulated?

With great opportunity, comes even greater responsibility, and having sensible, appropriate protections in place is also the role of government.

There are some who want to argue that on the internet, people should be able to publish anything they like — regardless of whether it contravenes laws in the off-line world.

The internet is an incredible piece of technology and in our lifetime it's unlikely we'll see anything like it again.

But for all its technical brilliance, the internet is a distribution and communications platform.

Having no regulation to combat illegal activity actually weakens all that is good about the internet.

The Government has always maintained there is no silver bullet when it comes to cyber safety and we have never said ISP-level filtering alone would help fight child pornography or keep children safe online.

The Government's $125.8 million Cyber Safety Policy incorporates a range of measures, including law enforcement, research and education and awareness.

The Rudd Government does not support Refused Classification content being available on the internet.

This content includes child sexual abuse imagery, bestiality, sexual violence, detailed instruction in crime, violence or drug use and/or material that advocates the doing of a terrorist act.

Under Australia's existing classification regulations this material is not available in newsagencies; it is not on library shelves; you cannot watch it on a DVD or at the cinema and it is not shown on television.

Refused Classification material is not available on Australian hosted websites.

The Government's proposal will bring the treatment of overseas hosted content into line by requiring ISPs to block overseas content that has been identified as Refused Classification.

This is a modest measure, which reflects long held community standards about the type of content that is unacceptable in a civilized society.

Those who claim that the Government's approach is akin to the sort of political censorship practiced by authoritarian regimes are simply misleading the Australian public.

Broadcasting

The transformation in the communications sector is much broader than investment in high speed broadband and the challenge of designing appropriate regulations around it.

We are in the early phase of a transformation of the entire media broadcasting landscape.

New waves of technology are driving convergence in the ability of networks to provide a broader array of services; and for market structures to change.

One core part of this transformation is the switchover that is currently underway from analogue to digital TV.

The switch to digital television will free up scarce spectrum, which can be used for new communications services, such as high speed wireless broadband.

This is a once-in-a-generation opportunity for Australia to take advantage of this important economic infrastructure.

This spectrum is known as the digital dividend, and realisation of the digital dividend is a key element of the Government's broader communications policies.

In January, I released the Digital Dividend Green Paper which set out the Government's objective to reclaim 126mhz currently used for analog television broadcasts.

Submissions on the green paper closed last month.

Importantly, the submissions showed that there is widespread support across the broadcasting and communications sectors for achieving the Government's target dividend.

In order to achieve this dividend, we need to switch from analogue to digital TV.

When I was last here, I signalled the Government's intention for the switch to digital television to be completed by the end of 2013.

I am pleased to report there has been much progress.

We are just 79 days away from the first region in Australia — Mildura / Sunrayasia — switching to digital-only TV.

The Digital Switchover Taskforce has been working effectively and cooperatively with broadcasters to undertake the planning needed to switch off analog TV.

There is a great deal of technical and legislative work going on behind the scenes to get ready for the switch to digital, but for the viewer, the most obvious change is the arrival of new TV channels.

Since the Government announced the end date for analog TV, Australia's free-to-air commercial broadcasters have embraced the opportunity to provide new services to their audiences - all have launched digital-only multi-channels over the last 18 months.

In a country as vast and as sparsely populated as Australia, the provision of communications services in rural and remote areas has always been a particular challenge.

In January, the Government announced that as part of the switch to digital television we will be funding a new satellite service.

This service will finally bring to viewers across the country the television services long enjoyed by urban Australians.

Legislation introduced into Parliament last month will underpin the new satellite service.

The new service will also provide viewers with access to their local news - something the existing analog satellite service does not do.

Public Broadcasters

Supporting industry to enable creativity and responsiveness, sustaining Australian content and prioritising the needs of the audience, is at the centre of the Government's approach to media policy.

It is why we have strongly backed Australia's national broadcasters, the ABC and SBS.

A healthy and diverse media needs both commercial and national broadcasters to play strong roles, engaging in creative pursuits and fostering competitive tension.

Last year, in the middle of the most significant global economic downturn in 75 years, the Government was able to give the ABC its biggest funding boost since it was incorporated in 1983, and to find new funding for SBS to produce more local content.

This funding increase has already seen the arrival of the long-awaited ABC children's channel, and is being leveraged throughout regional Australia to produce user-generated content and provide online media education to regional communities through the 'ABC Open' project.

Later this year it will also see the new 24-hour news channel launched on the ABC.

Across the broadcasting and media sectors we are seeing significant transformation, and once again reform is needed to keep up with this change.

In our discussion paper on telecommunications reform for the 21st Century, the Government flagged its intention to consider the overall regulatory framework for communications services in a converged environment.

As I have said previously, regulatory issues such as media diversity, ownership controls, audience reach rules and local content obligations will all need to be re-visited.

The Government's policies, particularly in creating the NBN and pursuing the switch to digital only television, have rapidly accelerated the arrival of the convergent media age in Australia after years of delay.

It is crucial that the appropriate regulatory settings are in place to foster competition, encourage diversity, inspire creativity and protect Australian voices.

Conclusion - reform unleashes transformation

I believe that when history is written on the significance of the changes underway in the communications sector, it will be compared with the industrial revolution, in its transformative impact on society.

I agree with the proposition that it's difficult to appreciate rapid progress when you're in the middle of it — but looking back highlights just how dramatic the changes have been.

Only 10 short years ago:

• Just over 1 in 2 people had a mobile phone, mainly for calls, and 'texting' was considered cutting edge. • Mass market broadband services were in their infancy and few people even knew what it was. • There was no i-Phone, let alone the thousands of applications that come with it. • There were no digital TV multi-channels and the idea of watching TV on demand was

something we heard about overseas. • And of course, the pioneers of Youtube, Twitter and Facebook were still penniless nerds, yet to make their mark.

I'll be one of the first in line for the new i-Pad when it arrives in Australia later this month, but I've got no doubt that in another 10 years, someone else will be standing here using it to highlight how times have changed.

The transformation currently underway in the media and communications sector is unprecedented in this country.

Never before in the modern era have we experienced such sweeping changes in one sector.

The opportunities presented by this transformation will be spectacular and we need to make sure Australia can take advantage of them.

It's why the Rudd Government is investing in the foundations for this transformation to the digital economy in the future.

And it's why reforming communications to drive and shape this transformation is so important.