Benefits of Hight-Speed Broadband for Australia

The report "Benefits of Hight-Speed Broadband for Australian Households" (dated 30 July 2013) by Deloitte Access Economics estimates the benefits of high-speed broadband to the average Australian household be $3,800 per year by 2020. This would apply to the ALP's  National Broadband Network (NBN) Fiber-optic network or the hybrid fiber/copper Coalition Broadband Policy.

The Department of Broadband, Communications and the Digital Economy, released the report during the federal election campaign. It is unusual for a government department to release a report on such a politically sensitive topic during the "caretaker" period of government. However, the report does not favor the ALP or Coalition.

The report suffers from a number of deficiencies. It refers to "smart-phones", which the NBN is not designed to support. The report claims that households will benefit from greater choice and competition from e-commerce and online services and greater employment opportunities through teleworking. However, it does not count the cost of greater online access to the Australian market of overseas companies and the off-shoring of Australian jobs made possible. Clearly there will be economic benefits from reduced travel costs and social benefits from better access to education online.

The report does not make clear how high-speed broadband, will provide benefits over lower speed broadband. I teach university classes via the Internet, but because my students could be anywhere in the world, on slow and unreliable Internet connections, I don't assume high-speed broadband. The students find this form of education very worthwhile. My course scored a perfect five out of five for student satisfaction last semester, beating most on-campus courses. Clearly if all my students had high-speed broadband I could use it, but it is not clear to me that this would greatly improve the student's education. As the consultants state in their report it is not a cost-benefit analysis, nor does it compare current broadband with high-speed broadband. The consultants have done a reasonable job within the brief they were given. However, it is questionable if the consultants should have accepted the brief and the report does not provide useful information on which to base decisions.

Benefit	Amount
COMMUNICATIONS > SOCIAL ENGAGEMENT & SOCIAL MEDIA	$74
E-COMMERCE > TRAVEL SAVINGS, CHOICE	$565
ONLINE SERVICES > ENTERTAINMENT	$269
TRAVEL SAVINGS > E-HEALTH, E-EDUCATION, E-GOVT	$217
EMPLOYMENT > TELEWORK, TRAVEL	$634
PRODUCTIVITY > LOWER PRICES, BETTER QUALITY	$1,930
TOTAL	~$3,800

Figure i: Benefits of broadband for households — a national framework

From: "Benefits of Hight-Speed Broadband for Australian Households", Deloitte Access Economics for DBCDE,  30 July 2013

Contents

Contents 3

Tables 4

Figures 4

Executive Summary 5

CHAPTER 01
INTRODUCTION 7

1.1 Outline of this report 7

1.2 High-speed broadband in 2020 8

CHAPTER 02
BENEFITS OF HIGH-SPEED BROADBAND 9

2.1 A national framework 9

2.2 Transition to the 2020 digital economy 14

2.3 Technology differences 15

2.4 Costs of participation in the digital economy 16

2.5 Social impacts 17

2.6 Environmental impacts 18

CHAPTER 03
BENEFITS OF BROADBAND FOR AUSTRALIAN HOUSEHOLDS 19

3.1 Older age household — single person over 75: 21

3.2 Young student aged less than 25: 23

3.3 Single professional in well-paid employment — aged 25+: 25

3.4 Couple, double income with no kids: 27

3.5 Couple household, one income, two kids: 29

3.6 Unemployed, aged 21: 30

3.7 Couple household (empty nesters), aged 65+: 33

3.8 Household of two — carer/disability: 34

3.9 Single parent household with BABY: 36

3.10 Household with a single person: 38

CONCLUSIONS 41

Appendix A References 42

Appendix B Regional data 46

Appendix C The value of leisure time 48

Limitation of our work 48