Broadband in the Age (Day 5)

This article marks the final part in my five part series, “Better know a broadband debate.” Today’s instalment, “a new hope” in which I discuss things other than broadband ‘pipes.’

Behind every great fibre-optic network is a great package of applications

Joshua Gans, The Age, 14th November, 2008.

OVER the past week, I have been reviewing the broadband policy debate. A theme has been what the Government should be using public money for. I questioned using it for faster video downloads as that was a low-value, private good.

I questioned using it to speculate on the future as it is likely the Government’s preferred technology is below what would be required to future-proof the network. Moreover, the main beneficiaries will be the richer segments of society.

I questioned going just for download speed when the issues of upload speed, caps and mobility were just as important. Finally, I questioned the tender process and regulatory issues and argued that the Government had an opportunity to spend public money to ensure long-term competition rather than just to earn a return.

In this final article, I want to go beyond the issue of infrastructure. Broadband is much more than the wires and equipment. To use it you need internet services and applications. And it is here that the Government can fill market gaps and directly increase the value of broadband to consumers. By doing that, it can help make the case for public investment in the infrastructure and also reduce the level of investment required as consumers will be more willing to pay for their own service.

The Cutler review of the national innovation system has devoted much of its report to these issues. It lists broadband applications as a targeted area; proclaiming that the “Government needs to start with itself” the review argues: “Australia needs to ensure that the relevant applications — specific to local needs — are developed to leverage the infrastructure for the purpose of government policy.”

These would include “applications in open democracy, database and privacy standards for health information, tools to facilitate educational use of broadband, traffic systems and standards, and national collections of information and knowledge”.

Consider the often-touted benefits in terms of health care from broadband investments. While the publicity shots feature remote surgery, it is not clear that this is where the greatest benefit lies. Let’s face it, the pressures that would require that event are, thankfully, not that frequent. Instead, it is the day-to-day medical needs of people that represent the greatest opportunity for improvement.

For example, consider a routine visit to your GP; say, to diagnose ear pain in a child. This requires bundling up your child, usually in the evening, and then a wait, perhaps up to an hour, for an unscheduled appointment. The GP will then examine your child’s ear, proclaim an infection or not and prescribe pain killers or antibiotics. There is a cost in the GP’s time and your time.

Suppose instead that you took a simple, already available $15 device that connected via USB to your computer and allowed you to take a high-resolution picture in your child’s ear. You then emailed it to the GP, who would provide the diagnosis or, if there was an issue, call you in to the surgery. More often than not, there would be no need of a visit. The savings in terms of time would be considerable for many households.

There are plenty of opportunities for remote diagnoses of a routine nature. Insulin levels, urine and maybe in the future, blood are all possible. The chief saving is of time. Moreover, with remote GPs, regional areas might have greater GP choice and certainly more accessibility. That is the promise of the internet.

You do not need a high-speed connection for these services. The costs of the technology in the home are relatively low. So, why don’t we see it? The answer is a combination of reimbursement and liability. GPs can’t get paid for these types of consultation and, even if they could, are exposed to medical liability that requires physical examinations. Both issues are within the control of the Government to reform. By doing so, this would open up e-health possibilities and add real value to our existing broadband infrastructure.

Government information is another issue. Much of it is locked away in a form that gives the Government control on how it is used. My favourite example is the Government’s national toilet map, which requires you to be at a desktop computer to access it. If that information were truly public, entrepreneurs could develop alternative access routes that would allow the information to be gathered from a mobile device. Let’s face it, it is when you are out and about that you need this information.

Broadband networks are of dubious value on their own. But the Government has a real opportunity to reform things under its control and to allow services to develop as complements to its proposed infrastructure investment.

Joshua Gans is an economics professor and director of the Centre for Ideas and the Economy at Melbourne Business School. He was an external adviser to the Cutler review.

2 thoughts on “Broadband in the Age (Day 5)”

  1. If the government took notice of its own first privacy principle and made all the electronic records it holds on a citizen available to the citizen then it would provide the infrastructure for simpler better public services

    This would be inexpensive to provide and would result in lower costs to governments as people could make sure their own records were correct and uptodate. They and we spend a lot of money updating contact records and sending things to wrong addresses

    Identification is desirable even for changes to the toilet system you mentioned because as you know electronic vandalism is “everywhere”.

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