Future direction trapped in halt state

ZDNet.com.au
news editor
Renai LeMay

commentary The location of the launch of Stephen Conroy's Digital Economy: Future Directions paper last night could not have been more appropriate, considering the report's content.

Those who've been to the Powerhouse Museum will know it holds such wonderfully modern examples of technology as steam trains and even a horse-drawn pump engine.

Likewise, Conroy's opus has done a fantastic job of curating well-known Australian technology success stories, without doing much at all to demonstrate how more such wonders of the world could be brought into being. Just noting existing government policies is not going to do it.

The report, disappointingly, does not constitute, as Conroy claimed, a strategic roadmap on how to transform Australia's digital economy from one of the developed world's weakest into anything even faintly resembling a powerhouse of innovation like the capabilities possessed by Israel, Japan, Silicon Valley or Korea.

As Stuart Corner, one of Australia's most experienced technology journalists, notes:

"It's full of motherhood statements, case studies on successful Australian digital entrepreneurs that are without doubt inspirational and it repeats ad nauseam the importance of the digital economy and the need for all sections of industry to get on board."

Having forced myself through the whole 103 pages ... I wholeheartedly agree. The release of such a self-congratulatory report does much to demonstrate that the Rudd Government's approach to developing Australia's digital economy is very similar to that of its Coalition predecessor and most of Australia's state governments.

With the exception of Victoria, Australia's governments have done very little over the past two decades to foster ICT innovation within their fiefdoms

With the exception of Victoria, Australia's governments have done very little over the past two decades to foster ICT innovation within their fiefdoms, preferring to concentrate instead on the resources, agricultural and even manufacturing sectors. Long-standing Queensland ICT Minister Robert Schwarten went so far in June as to declare that a mammoth and intense lobbying effort by the state's entire ICT industry during the recent state election had "no effect whatsoever".

Yet, as the report itself highlights, in the next several decades, it is technological and content supremacy that could allow Australia to take a much stronger position on the world stage.

The few areas in which the report does suggest new policies to tackle the digital economy appear to be sideline cases or actually to take the debate backward.

It is unclear, for example, whether there is widespread demand for new regulations to target illegal file-sharing or to include new platforms such as social networking sites under "safe harbour" laws that limit liability in intellectual property theft cases, as the Future Directions report proposes.

Ten years of working in and writing about Australia's ICT industry leads your writer to believe that much stronger incentives are needed if Australia is truly to develop a digital economy. And by incentives, I mean money.

Australia needs to create extremely desirable taxation situations for multinational technology, content production (film, TV, new media and especially computer gaming) giants to set up shop within our borders.

We need to lure these firms one by one, with sweet promises of honey.

Australia needs to set up similar taxation schemes to incentivise local technology start-ups of any flavour to get their operations off the ground, and similar regulations that would make it attractive for venture capital and early stage investors to find a home down under. We need to nurture these companies as carefully as we would new-born babies.

Thirdly, we need to immediately cut any barrier to entry to students entering technology courses at a tertiary level and dramatically raise lecturer conditions as well as increasing their numbers. We need to make students want to study technology. Desperately.

The report, disappointingly, does not constitute, as Conroy claimed, a strategic roadmap on how to transform Australia's digital economy

There are very few mentions in Conroy's report of any of these kind of measures.

Now, I'm not sure how much time the minister or his staff have spent out on the road in recent times talking to the Australian technology community about the problems it faces. But ZDNet.com.au has, and there's a few facts we'd like to pass back up the ladder.

Mick Liubinskas and Phil Morle's merry band at Pollenizer and the guys behind Startup Camp are probably doing more in real terms to build Australia's technology start-up community than the entire NICTA and CSIRO groups are. The fact that the CSIRO is currently suing every Wi-Fi provider in existence isn't garnering Australia a great reputation, and NICTA has long been viewed by the industry as a token effort.

Australian start-up RedBubble generated almost as much buzz as the entire Future Directions launch last night during its event at the same time at the Hive in Melbourne. The company told the audience it's almost impossible to get venture capital in Australia as an internet company. That's how bad it is. Great juxtaposition there.

Furthermore, it's a fact that large technology companies like CA and NEC are actively pulling their research and development efforts out of Australia, as we have reported.

To add insult to injury, one of Conroy's own backbenchers, Kate Lundy, has single-handedly galvanised a massive wave of development in using technology to improve government collaboration and improve citizen engagement. Her effort — from the back bench — is dwarfing Conroy's own, from the position of minister.

Now the obvious rejoinder to all of this is that the Federal Government is in fact investing a massive amount in the Australian technology scene. I refer to the $43 billion being ploughed into the National Broadband Network.

The NBN does have the potential to create a lot of jobs, as Conroy has pointed out. However, these will in the short term be jobs in the construction industry as the fibre rolls out, and later on, in the internet service provider industry.

It is drawing a long bow indeed to state as a bald fact that the creation of a strong network like the NBN will automatically lead to the creation of a vast swatch of companies in the higher levels of the technology and content stack that the NBN sits at the bottom of.

The NBN is a content transmission platform; not an investment incentive scheme.

Is Conroy's Future Directions paper a concrete plan or a waste of time? Post your comments below this article or send a letter to the editor.