Tasmanian ICT needs support to grow
Tasmania's ICT industry is being held back by poor infrastructure, ineffective government support and market size, according to a report into the sector released by the state's treasurer yesterday.
Focus groups held in Launceston, Devonport and Hobart (part of the study conducted by management consultants Whitehorse and the Centre for Innovative Industry Economic Research) stated a lack of reasonably priced broadband capacity to be a major problem dogging the industry. They also found that although the government tried to help the ICT industry, a lack of knowledge has hampered its efforts.
"The Intelligent Island program is seen by some respondents to have missed its target; most of the focus group attendees didn't experience any advantage within their business," the report said. Intelligent Island funded initiatives such as an ICT research facility and programs to bring new products to market.
One way the authors felt the government could help going forward would be to introduce programs to encourage Tasmania's consulting and services market.
Tasmanian ICT revenue amounted to a total of $1.4 billion in 2008, 1.6 per cent of the total Australian ICT revenue, according to the report. Within various industry segments such as telecommunications, wholesale trade, manufacturing and software and computer services, only software and computer services revenue grew as a percentage of total Australian ICT revenue between 2003 and 2008. The segments' share of Tasmanian ICT revenue grew from 9 per cent in 2003 to 19 per cent in 2008.
"It may be worth Tasmania considering programs similar to those recently adopted by the Victorian Government to maximise local ICT industry consulting and software services participation," the report suggested.
Something needed to be done to offset the lack of size, the authors continued. Most Tasmanian ICT participants were small to medium-sized businesses which, when they reached a certain point, would be merged or bought and have large parts of the business moved to the mainland. If they did stay in Tasmania, they would have to export their business due to the size of the local market.
Multinationals went after the larger clients in the market, such as the government, competing with local firms. In a lot of the other, smaller, segments, local firms had the run of the field. The "thin" nature of the Tasmanian market meant that no dominant market focus presented itself as a focus for cooperation between players.
Similarly, research and development efforts were spread out over the market, not ideal for achieving results. "The range and diversity of foci suggest that it may be difficult for critical mass to be achieved in all cases, and some concentration of research effort could result in more effective outcomes," the report said.
The authors recommended that industry body TasICT help with the exchange of information to improve these problems.
Aside from the forums, information for the report came from a survey of ICT companies in Australia, known as the "Whitehorse Top 250", which covers 790 operating companies, as well as sources such as annual reports and web searches.