COMMUNICATIONS POLICY IN AUSTRALIA – THE ROAD AHEAD
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SUBJECTS: Media regulation; NBN; Public broadcasting; Australia Post.
Tonight I’d like to set out some thinking I’ve been developing over the past few years in the Communications portfolio space and apply them to some contemporary issues.
And when I look back at some of the initiatives, conferences, technological predictions and inquiries in the sector over those years, there is often reference to Australia and the world in or beyond the year 2020 – now barely 9 months away.
So, let’s get to it.
I’ve chosen the title of “The Road Ahead” for this address because it speaks to three matters that are constantly front of my mind in both the Communications portfolio and my political life generally.
To explain the first, I take you back to a Year 11 student at an all-girls Catholic school in 1988.
There was no social media, no email, the internet didn’t even exist in my well-worn dictionary. I had never seen a mobile phone.
Yet I was socially and politically aware, as were my group of friends at school; as were many of my colleagues at the supermarket where I worked in Blacktown, with frequent debate over current events in the lunch room.
When I’m asked about how and why I got into politics, mainly by school children, I recall that I had both stimulating teachers at Our Lady of Mercy Parramatta, and that I was lucky to have a dad who worked as Circulation Manager at John Fairfax and Sons. Every night he would bring home a bag of newspapers and magazines from around Australia and even the world. I read Ross Gittens for my economics homework.
So when the occasion presented itself to protest against the education cuts inflicted by the NSW Greiner Government and its Education Minister, Terry Metherell, I was there with my friends and tens of thousands of other citizens. The notion of cutting funding for education and sacking teachers was repugnant to me. It was short-sighted, mean, just unfair.
Thirty years later, Australian students are out protesting again. This time it’s about government inaction on climate change.
To vent their anger with a government whose (now) Prime Minister brandished a lump of coal in Parliament as an immature stunt with his pet rock.
To demand genuine, lasting action that transcends party politics and vested interests.
These students can’t vote, not yet anyway.
But to anyone who thinks that today’s young people are disengaged, isolated, passive or mindless consumers, scrolling through endless hours of selfies: think again.
Young people are engaging in Australian democracy and having their say about our nation’s future.
A shrewd political meme created by a 14 year old at the dinner table on their smartphone can attract thousands of comments and shares in a few hours, receiving vastly more traction than most political press conferences.
According to McCrindle Insights: “Generation Z born from 1995 to 2009 were shaped in the era that society started looking at screens more than at faces”.
Gen Z is defined by five factors:
- they are digital;
- they are the first truly global generation;
- they are social in nature;
- they are mobile; and
- they are visual.
Also known as “The Net Generation” or “Screenagers”, these digital natives will comprise almost one third of the entire workforce within a decade.
Young people are forward-looking.
They’re not afraid of technology.
They’re not concerned with protecting vested interests or traditional business models, whether in the face of climate change or disruptive digitisation.
Indeed, they understand too well the need to adapt as action on climate change and the fourth industrial revolution, powered by 5G, Artificial Intelligence and data, will fundamentally reshape our economy and society – including the work they will themselves perform.
Young people expect their government to secure the nation’s prosperity into the future.
They deserve a government that acts today with an eye to tomorrow, be it delivering quality education, addressing climate change, or delivering decent broadband.
So young people have every reason to protest when a government they cannot vote against, lacking an agenda and consumed with infighting, turns to fear as a cause for power.
In the face of the breakdown of trust in institutions – with everyone from the banks, the church, to the aged care and disability sector having failed the vulnerable in our community – and with concerns about global instability associated with climate change, the fourth industrial revolution and geopolitical realignment to grapple with, what does this federal government do?
It seeks to make people more fearful and less trusting.
Sick asylum seekers will take your hospital beds, they say.
An emissions reduction target will spell the end of night-time footy and cricket, they say. Apparently it will also mean a $9,000 hit to your wages (that’s the Energy Minister today).
This brand of politics has a unique odour.
It’s reactive. It’s about immediate risk mitigation. And it’s incapable of a future focus.
And it’s in that context that my first imperative arises when considering the road ahead for communications policy in Australia: long-termism.
From envisioning the National Broadband Network; to the kind of society we want to be in the Internet of Things; to seriously utilising technology to address digital exclusion amongst Indigenous Australians, older Australians, and Australians with a disability – the only way governments can make technology work for its citizens rather than against them is with a long-term approach.
And make no mistake: as I move around my electorate and indeed in many parts of Australia, it’s the absence of long-termism that frustrates people the most. From over-development in our outer suburbs, train stations made inaccessible by inadequate commuter parking, to purchasing 27,000km of new copper to build a supposedly 21st century broadband network: people are frustrated because it’s their quality of life that is impacted by such short-sightedness.
And this brings me back to ‘the road ahead’, and the second of my imperatives: the need for a comprehensive strategy to drive the digital economy.
In search of a strategy
We all remember upon Malcolm Turnbull’s elevation to the Prime Ministership, his language was future-looking and underlined the contrast to his predecessor. We heard a lot about being dynamic, agile, innovative, excited. There were predictions his tenure would rival that of Menzies.
The release of his billion dollar “Innovation Agenda” some three months later, calling for “an ideas boom”, appeared to back up the rhetoric. He identified the need for economic transition; his language explored the future of work; there were over 20 measures ranging from STEM to tax incentives.
Put aside the fact that some 6 months later after very nearly losing the election, Turnbull was being white-anted and that very policy was being used as ammunition. Because less than 2 years after that, the Auditor-General delivered a scathing assessment of the Turnbull flagship strategy, the one that was meant to define his long and glorious reign. As Stephanie Peatling beautifully surmised, its report could have been a script for Utopia: it criticised the foundations of the policy, the quality of the advice that underpinned it, and concluded that some high dollar economic proposals relied on assertion rather than evidence.
I draw on this example for 2 reasons.
Firstly, I have long called for recognition by this Government that the communications sector is in transition, and a comprehensive roadmap is needed to help guide the way forward for the highly valuable and strategic networks and industries within the portfolio.
Digitisation, convergence and technological innovation have ushered in new ways of delivering and receiving services and content, yet our laws barely recognise these changes.
What once were distinct broadcasters, telcos and print media companies are now multi-platform operators generating video content, podcasts, news and interactive experiences.
Over-the-top companies, including global digital platforms like Google and Facebook, streaming services like Netflix, as well as VOIP services like Skype have emerged.
New industries and revenue streams have grown, some old ones are struggling, whilst others have evolved.
We now count app developers and YouTubers as part of the creative industries ecosystem. The marketing industry has evolved the capacity to deliver innovative tech-based solutions to address client needs.
We’re still identifying ways to utilise 4G as early business cases for 5G technology begin to take shape.
Yet Australia’s policy and regulatory framework for media and communications remains stuck in the siloed, analogue era of last century and, as a result, we’re missing out as a nation.
If Australia is to realise the benefits of digitisation, convergence and technical innovation, a genuine and holistic program of reform is needed to modernise the policy and regulatory framework governing the sector.
Without such reform:
- consumers remain exposed to an inconsistent patchwork of content safeguards, determined by what platform they are on;
- traditional media and telco companies suffer the anti-competitive effects of regulatory disparity;
- the creative industries, including the screen production and interactive game development sectors, miss out on a range of growth and investment opportunities;
- network investment, upgrade and deployment lags; and
- Australia fails to grow the jobs and industries of the future, fails to harness trade opportunities and fails to facilitate content creation that enriches our cultural expression, enhances social cohesion and builds the nation.
Other jurisdictions around the world have joined up, cross-portfolio visions and strategies for communications, and have updated their regulatory frameworks many times over.
It is unacceptable that this work remains unplanned and undone in Australia.
The case for genuine reform of the policy and regulatory framework was made out many years ago.
The former Labor Government commissioned the Convergence Review which recommended far-reaching reforms along with staged implementation and, since then, successive Chairs of the ACMA have referred to the framework as ‘strained’, ‘broken’ and ‘irrelevant’.
In contrast, this Government has articulated next to nothing in terms of a vision for communications, 5G or the digital economy.
There is no communications strategy to speak of, and only a paltry 5G Directions Paper that mentions usual business of government processes and which fails to set out the true reform task that lies ahead for 5G in Australia.
The Government squibbed its much anticipated digital economy strategy, releasing “Australia’s Tech Future” only days before Christmas – a document vague on targets and outcomes which merely describes initiatives already in train and offers no bold vision to drive growth in our digital economy.
For well over 2 years now, and ever since the then Secretary of the Department of Communications and the Arts mentioned they were working on it, I have expected and wanted to see this Government’s communications policy roadmap.
I have wanted it to make sense of the Government’s legislative agenda, to understand the impact of various delays to that agenda, and to inform Labor’s policy responses. I’m acutely aware that a variety of stakeholders desire it for a variety of commercial reasons and to formulate their own strategies.
For example, with a roadmap, there is more readily a shared understanding of the timing of a future upgrade of the terrestrial broadcast platform (for which other jurisdictions around the world are well-progressed), as well as a better awareness of what the future service offering of broadcasters is likely to be, as across their terrestrial, catch up and other online services.
This, in turn, informs a shared view on what is appropriate and sustainable in terms of content quotas, what flexibility can sensibly be introduced, for example.
Similarly, it informs a view on the implementation of audio description, or even what research is required around media consumption.
Time and time again, Labor has sought information about the release of the Communications Policy Roadmap, yet it has not been forthcoming.
It is no coincidence that, in that time, the Government’s approach to media and communications reform has been piecemeal, lacking coherence and beset with delay and indecision.
In 2016, the Government proclaimed it would be enacting “the most significant reforms to our media laws in a generation”.
In fact, so inadequate were these regulatory changes, that only one year after their passage through Parliament, the ACCC made a preliminary recommendation that there be a sweeping review of media regulatory frameworks – something I had called for in 2016, but which was dismissed by government on the false basis that “all the relevant facts are already known”.
What’s more, the Ministerial Direction that serves to prevent the primary piece of legislation (the Broadcasting Services Act 1992) from applying to, or regulating, the internet is due to sunset in October this year.
I would be keen to hear the Government explain how it regards the status of that instrument in the context of the broader reform task it has left undone.
The Communications portfolio is feeling the weight of six years of stop-start policy making, of no coherent reform agenda, in everything from spectrum reform that has been underway for over 4 years with no end in sight; the stalled report of the Australian and Children’s Screen Content Review; lack of implementation into recommendations on Australia’s video game development industry; and leaving the recommendations of the Senate Inquiry into the Future of Public Interest Journalism unaddressed.
Just as citizens are frustrated with political short-termism, it is detrimental to the sector to endure such policy paralysis.
But more importantly, and this brings me to my second point: it’s a policy paralysis that is ultimately detrimental to consumers.
Labor has long called for a roadmap to inform coherent and sustainable policy development going forward – not for its own sake, but because of the values we hold and the benefits we want to realise for end-users.
This Government’s response has ranged from promising one years ago that has yet to materialise, to mocking the request, to most recently committing to the release of one next month. Of course it is ironic that the delivery of its roadmap is scheduled to be released at the end of a parliamentary term, rather than at the beginning. So what will that mean? To me, this is very much looking like a strategy in search of a value.
Herein lies another lesson of the Turnbull Innovation Agenda: governments need to be clear on what is important, and what is less important, and if it gave itself one job, what would it be? While everything may be important, it is the values that help clarify what really matters in order to meet your objectives.
Political values should be a judgement about what is good for the country.
They help you discard the distractions and focus on the things that matter, and the changes which make a real difference to people’s lives.
The reason I touch on this point is because I want to emphasise that Labor’s approach in the Communications portfolio will be values-driven.
This is underpinned by a view that inequality is not just immoral – but that it is economically irresponsible.
What excites me about the portfolio is that despite its modest size, it is so far reaching, and has so many touch points with the community. It has so much potential to include more Australians in society and the economy.
It is within this context that I note digital exclusion continues to be a feature of inequality in the 21st century.
According to the 2018 Australian Digital Inclusion Index, undertaken by Telstra, RMIT and Roy Morgan, a substantial digital divide still exists in Australia. This is particularly true for Indigenous Australians, older Australians, and Australians with a disability.
Even in the land of the fair go, it is clear that inclusion and fairness are not self-executing.
We have to work at it and do better because there is so much to be gained by doing so.
The way forward is put the staff of the Australian Public Service back to work, in conjunction with industry and community stakeholders, to lay out a coherent and future-focussed program of work, to conclude processes in accordance with best practice policy-making and to commence work on the broader reform agenda without delay.
The NBN is a values proposition
Speaking of values, the National Broadband Network is a project that is very important to the Labor Party and, for us, has always been a values proposition.
Not simply because we started it.
After all, no telecommunications network is an end in itself.
But because the original mission is the embodiment of our core values.
Improving quality of life.
Labor is a movement of and for the future.
This is why we invest in human capital through education and child care.
It is why we back renewable energy.
It is why we backed investment in world-class broadband infrastructure.
We believe that investing in people and the productive capacity of our economy is the way to drive inclusive economic growth that is built from the bottom up.
These investments are not just policy measures in isolation.
They represent value judgments that become the broader narrative about the society we aspire to be.
For me personally, the Communications portfolio is an instrument to help create a smarter, more modern, and more inclusive Australia.
An Australia where connectivity and content enriches our quality of life, educates us, informs us, and empowers us to fulfil our potential – whatever that may be.
This brings me to the future of the NBN.
As a starting point, customer experience has to be a top priority.
This is why Bill Shorten and I announced Labor’s plan to implement an NBN Service Guarantee.
This will establish wholesale standards for fault rectification timeframes, installations and missed appointments, enforced through financial remedies that apply to NBNCo.
A key design feature of our policy is that stronger penalties will apply when a small business is impacted.
The goal here is not to punish telecommunications providers, but rather to incentivise more responsive service.
In particular, a key focus for Labor will be to better safeguard small businesses against unreasonable and excessive periods of NBN downtime.
Less downtime and greater accountability - that’s what we want to achieve.
With respect to the longer-term issues, one of the key policy challenges Labor has been grappling with is the future cash flows available to NBNCo.
Cash flows have an important impact on public entities, in the same way that budgets have an important impact on governments.
If cash flow is healthy you can invest more, be flexible on prices and provide services that the market would otherwise not deliver.
However, if cash flow is not healthy these objectives can become more difficult.
The decisions in 2013 to change the technologies used on the NBN has had an unfortunate impact on cash flow.
Relative to the original fibre plan, the multi-technology mix costs more to operate and requires higher capital expenditure.
This is due to copper and HFC technology producing more faults, requiring more technicians and consuming more power.
According to an ACMA analysis of industry data, the average household on these networks was reporting between 2 to 3.6 times more faults than those on fibre, and making between 3 and 5 times more complaints.
The Government’s own figures suggest the change in technologies has pushed up operating costs by significant amounts – hundreds of millions a year.
In addition, the most recent NBN business plan also shows in the year 2022, after the rollout is complete, taxpayers are still injecting $300 million per annum of capital expenditure into the copper and HFC networks.
Yet in the same document, when we look at Fibre to the Premise, or the Fibre to the Curb, there was little to zero capital going into the existing brownfield footprints.
These factors have pushed the NBN cost floor up.
Now to revenue.
It is reasonable to assume that if you offer a high quality and fast NBN, many people will be willing to pay for it.
Again, this is where the multi-technology mix has limitations.
It generates less revenue as the copper network can’t deliver the faster speeds that some are willing to pay for today, and that more will be willing to pay for tomorrow.
According to the ACCC, only 1 in 20 premises on Fibre to the Node are currently taking up a 100 Mbps plan. In comparison on fibre, 1 in 7 are doing so – three times greater.
A deep-fibre access network would have also allowed NBN to play a complimentary role in the rollout of 5G and create a new revenue stream by making fibre available to mobile operators deploying 5G cells.
Regrettably, as Mike Quigley noted in his recent Monthly Essay, this opportunity has been diminished under the current model. It has turned 5G from being a potential revenue opportunity for NBN, into a revenue threat.
This has pushed the revenue ceiling down.
You probably see a picture emerging here about the impact of the multi-technology mix.
The ongoing cost to run the NBN has gone up.
The ongoing cost to remediate the NBN network has gone up.
The revenue potential has come down.
The result of this is the cash flows of NBN have been reduced.
To put it simply the Coalition’s approach:
- has cost more to build;
- does not provide consumers with the same speed or reliability of the original plan; and
- leaves taxpayers at least several hundred million dollars a year worse off – potentially over half a billion per year worse off over the medium term.
On top of this, the network requires future upgrades in the fixed-line footprint that would not have been needed under the original plan.
Now if we had a less capable network that was significantly cheaper to build you could sit here and have genuine debate about the merits of one approach versus the other.
But we don’t.
Our opponents promised to deliver the NBN for $29.5 billion.
Then it became $41 billion. Then $49 billion. Now its $50.9 billion.
In contrast, the original fibre rollout had a peak funding requirement of $45 billion with a completion date by the end of 2021.
Just about every key assumption underpinning this forecast has stood the test of time.
To be fair, I’m sure when Mr Abbott and Mr Turnbull announced their 2013 policy they believed their approach would be cheaper.
The problem is the NBN was far more complex than anyone outside of NBN management could have anticipated.
There were so many integrated layers — engineering, construction, financial, legal — and the fact it takes years to scale any new technology up — that it would have been near impossible for any Opposition party to grasp what they were tinkering with.
Once the tinkering began in late 2013 the show fell apart pretty quickly.
The irony of this situation is that the Liberal Party promised its multi-technology mix would be faster and cheaper, yet we now have a business model that is in more need of cash flows — but has less capacity to generate it because of inferior technology and higher costs.
What does this mean moving forward?
Whoever wins the next election will have a challenging task on their hands to reposition the NBN for the future.
There is a careful balancing act to be struck.
If I could wind forward six years and describe the outcomes I’d want to see it would be as follows:
- I’d want the National Broadband Network to be the network of choice for Australians.
- I’d want it to be delivering a good experience for consumers and businesses, with customer service getting better and more responsive over time.
- I’d want to know that Australian small businesses are benefiting from stronger service standards that reduce the downtime they experience.
- I’d want to see NBN services remaining affordable and delivering great value for money, with 5G competition helping to keep entry level prices low.
- I would want to see more Australians experiencing the benefits of deep-fibre connectivity, including greater speeds and reliability.
- I would want to see regional Australians enjoying an improved quality of life as a result of opportunities enabled by the NBN.
- Lastly, I would want the National Broadband Network to be well on its way to becoming a brand that Australians trust and respect.
That is, a world-class National Broadband Network delivering fast, reliable and affordable broadband – underpinned by good service and an authentic brand promise.
It’s pretty simple stuff when you boil it down – something we could truly be proud of.
It wouldn’t surprise you that I’m regularly asked what Labor’s NBN policy is going to be.
I can start by telling you what it won’t be.
We won’t be offering a quick fix.
Nor will we be making promises we can’t keep.
What I can say is that our NBN policy is close to being finalised and I look forward to presenting our plans in the not too distant future.
What we will present, I believe, is a credible, responsible, and multi-layered plan to improve the NBN.
This plan will be about trying to connect the short term with the long term, and of course, that fuzzy place in the middle where one turns into the other.
There was a vision articulated a decade ago that was the National Broadband Network.
A lot has happened since then.
Some of that has been positive. Some of that hasn’t.
Regardless of whether it is the network we wanted or not, if we have the privilege of being elected, a Shorten Labor Government will be committed to the NBN and its future.
The NBN is simply too important, both in terms of what it enables, but also what it says to the nation about itself, to not get the attention it deserves.
Rebuilding trust in institutions
At a time when too many Australians feel disengaged from their democracy and distrustful of their representatives, Labor wants to restore trust and faith in our institutions.
In a Western liberal democracy like Australia, the separation of powers is fundamental.
The full and proper functioning and performance of the three distinct pillars of Parliament, the Executive and the Judiciary is essential, as is the operation of the Fourth Estate – the media that holds the powerful to account.
But all too often, this Government has politicised what should be independent statutory appointments.
And on many occasions they’ve ignored the Executive altogether, not even bothering to consult with the public service on policy proposals.
It does little to engender trust when politicians bypass proper process only to gift large parcels of taxpayer funds directly to private entities for short-term initiatives.
Having learned nothing from the Great Barrier Reef Foundation debacle, the Government recently threw $17 million at industry peak body, Free TV, to bolster Australia’s soft power diplomacy in the Pacific, without properly consulting the relevant Departments, let alone Free TV or Pacific Nations.
Despite the fact that two APS Reviews into soft power are currently on foot, the Government decided to blunder ahead with this ill-conceived and ham-fisted announcement.
Further, it does little to engender trust, when politicians, indeed when the Prime Minister, exhibits contempt for a statutory requirement to ‘consult’ on the appointment of the ABC Chairperson – a role predicated on independence and integrity – and merely ‘informs’ the Leader of the Opposition on who the candidate is in the lead up to a pre-arranged press conference.
Having learned nothing from the political interference scandal at the ABC, the Government awarded a $163,000 recruitment services contract to Korn Ferry, whose Head of Board Services is a significant Liberal Party donor, to help recruit the new Chair of the ABC.
And just as people are sick of cynical short-termism, they despise the interests of big business being prioritised over the public interest.
They’re sick of the politicisation of their institutions and the endless jobs for Liberal chums.
Labor has already announced that it will establish a National Integrity Commission to prevent, investigate and eliminate corruption inside the public sector and the federal government, and to restore the public’s trust in politics and the public service.
And Bill Shorten has already announced that if he is able to set up the Commission then the first reference will be Helloworld.
Rather than Ministerial thought-bubbles and backroom deals, Australians want well-crafted policy that is of real substance, value for money and that will stand the test of time.
They expect the APS to be utilised; to do what they’re paid to do, which is serve the Government, the Parliament and the Australian public with professionalism and provide advice to government that is apolitical, frank, honest, timely and based on the best available evidence.
Labor has already committed to abolish the Liberals’ arbitrary Public Service staffing cap, strengthening capacity and capability within the APS.
It is my belief that the APS in the Communications portfolio should be utilised to test and refine policy ideas, and to progress coherent policy initiatives as part of a holistic program of work to transform our policy and regulatory frameworks. Indeed, Martin Parkinson conceded in his response to the Auditor-General on the Innovation Statement that there was a need to ensure rigour and an evidence-based approach to policy design.
The APS should not be ignored or bypassed, nor should they be misdirected on pointless bills and inquiries designed to undermine the institution of public broadcasting, which plays an important role in our democracy.
Part of restoring trust in Parliament is supporting a healthy public interest media sector, and protecting an institution that is actually trusted by the Australian people – the ABC.
Labor has been fighting against the Government’s cuts and attacks on the ABC to ensure it can continue to deliver on its Charter for all Australians.
One point that has been emphasised during the Senate Inquiry into allegations of political interference in the ABC, now on foot, is that, to guard against political interference, independent institutions like the ABC need stability.
Labor has already announced that it will reverse the Government’s unfair cut of $83.7 million and guarantee stable funding for the ABC over the next budget cycle.
Labor is currently considering the evidence adduced during the inquiry, which is due to report later this month.
While questions about the conduct of the ABC Board are a relevant area of consideration, what is plainly apparent is that this government has sought to interfere in the ABC in almost every conceivable way.
More broadly, Labor acknowledges the importance of the Fourth Estate and respects the role of journalists and reporters within our system of democracy.
The Fourth Estate in Australia has a strong track record of achievement in terms of exposing scandals and shining a light on corruption which has precipitated a number of Royal Commissions, and led to real change and improvement.
Politicians might not always like what an individual journalist or news outlet asks or says, but, and to paraphrase Bob Carr in his book Run for Your Life, that’s the price we pay for democracy.
And while there’s room for disagreement on matters of substance from time to time, and lapses of judgment will occur, I believe it runs counter to the principles of our democratic system of government to criticise or mock a journalist simply for doing their job.
However that’s precisely what we see the Premier of NSW and senior members of her government doing right now.
Mocking a journalist who asked a perfectly reasonable question about a missing business plan, poking fun at their news outlet and branding them “operation normal”.
The optics of a regional journalist who wanted to ask a question being physically pushed away by security staff to his loud and professional protestations.
The Treasurer, laughing off an un-declared political donation.
What Gladys Berejiklian seems to fail to grasp is that with power comes accountability, and the scrutiny of politicians by journalists is the performance of an important civic function that goes to trust in our democratic system.
Indeed, Scott Morrison too seems to want to deflect questions he doesn’t want to answer as ‘the Canberra bubble’.
In the end, however, these interactions do still serve to inform the electorate.
They function to identify when a politician lacks the discipline to maintain their composure, emotional intelligence or even simple humanity to answer the questions of a fellow worker in the field as part of a democratic exchange.
Speaking of trust in institutions, I want to turn to Australia Post.
Australia Post is an institution that is over 200 years old, and yet, it continues to be relevant.
According to Deloitte, 92 per cent of Australians have visited a post office in the past six months. That is quite a remarkable feat when you think about how much the world has changed and what the core business of Australia Post has been.
Australia Post is among the most trusted brands in the country. 74 per cent of Australians consider the institution to be a core part of our national identity and of significant heritage value.
This is in no small part due the 35,000 odd employees who do an incredible job day in day out. They represent the company well and really are the heart and soul of the institution.
I also want to acknowledge Christine Holgate, the Australia Post CEO.
As I said last year in the Pacific Connect forum, Christine has instilled a sense of optimism about what might be possible, demonstrated a distinctive empathy for the role of Australia Post in the community, and shown her determination to find new ways to grow the business by exploring opportunities that might otherwise have been left untouched.
She is the kind of leader that every Government Business Enterprise needs.
Just recently, Australia Post secured an agreement with 3 of the 4 major banks to ensure Australia Post was fairly compensated for providing access to its retail network, and this is a very good result – particularly for regional communities where we have seen bank closures.
When thinking about the future of Australia Post there are several themes which come to mind.
The first is the continuing need to embrace change.
It’s no secret that letter volumes are on the decline.
Each year, businesses are sending few letters because the internet has enabled created cheaper and more convenient options to reach customers.
Before the GFC hit there were 5.6 billion mail items going through the Postal network. In 2017-18 this had dropped to 3.3 billion items.
This year-on-year decline generally hovers between 8 and 11 per cent, and it doesn’t appear to be slowing down.
Fortunately, over this same period, online platforms captured and enticed a new generation of online shoppers by offering greater convenience, value and choice – leading to a flourishing e-commerce boom.
The challenge of course is whether the decline in letters outpaces the growth in parcels. For example, in the recent half year results parcels growth added $25 million to earnings, while letters decline reduced earnings by $102 million.
The reality for Australia Post is so long as letter volumes continue to decline the business will never be able to stand still or become complacent.
They will always have to adapt, they will always have to be innovative, they will always be faced with difficult choices.
This means managing the decline of letters by finding efficiencies and productivity improvements, carefully managing pricing, and constantly becoming better in utilising the capacity of delivery staff and the network.
It also means intelligently pursuing new opportunities to help cross subsidise the unique social presence that Australia Post has in the community, particularly in regional Australia.
My view is the role of government is not to resist change in the face of disruptive technology — because in the long-run that is always counterproductive and, frankly speaking, does more harm than good.
Rather, I think our role is to be engaged and, where appropriate, play our part to facilitate change in a manner that best serves the public interest.
This brings me to opportunities in Asia.
One of the important opportunities is the growing middle class of the Asia-Pacific and the Indo-Pacific, which has been talked about for some time.
This is why Labor has developed a comprehensive and holistic policy to a deeper Asian engagement called ‘FutureAsia’, a framework for deeper and more meaningful collaboration with Australia’s Asian neighbours, both at an economic and cultural level.
Towards the end of last year I held an e-commerce roundtable and it was put to me by a Google executive that of the next 1 billion consumers to join the global middle class, 9 in 10 will be in Asia.
These consumers are increasingly shopping online, spending more, and looking for higher quality goods associated with brands they trust.
That is an arena which I really feel more Australian small to medium sized businesses have an opportunity to be in.
I’ve heard some interesting examples where businesses conducted their first digital marketing experiments over social media into Asia, to then find their product take off beyond their wildest expectations.
This prompted me to ask – how many other Australian SMBs are out there who have never taken that step but could stand to benefit?
And who would they trust to provide them with the practical know how to de-risk the process of experimentation, and take that first step?
As I noted earlier Australia Post has a highly trusted brand – one of the most trusted in the country.
In a world where confidence in institutions, politics and business is waning, policy makers have scope to better leverage trust for public good.
So often I have seen situations where government or business is trying to tackle a challenging problem and ultimately finds that trust is the only thing which cuts through. It reaches into corners and places that are otherwise very difficult to reach. It can be a decisive factor in the moments that matter.
I certainly hold the view that if there is a policy challenge that arises in the Communications portfolio, and we think trust is a critical part of the solution, we should be open minded and creative in exploring ways to leverage what we have.
Leveraging platforms in the Communications portfolio
The Communications portfolio contains a number of key public institutions, assets which, in some cases, have been built up, expanded and improved upon over successive generations of Australians.
Key public assets that Australian taxpayers have invested in, own and value – some of them are arguably more trusted and valued than others:
Whatever your view, the reality is these are more than just institutions or assets.
They are platforms.
They are networks.
They form part of broader ecosystems.
As ever, it is what these platforms can do that matters.
I am interested in thinking about how we can leverage Australia’s investment in these platforms in the 21st century.
The ABC is more than just a broadcaster. It is:
- a multi-platform media operation;
- a physical rehearsal and recording space for musicians;
- a meeting place and training opportunity for young regional and rural Australians;
- a trusted soft power asset for outreach in the Asia Pacific; and
- a media literacy tool for young Australians, among other things.
Similarly, the SBS is more than just a broadcaster. It is:
- a multi-platform resource for new migrants, an English-language hub and source of Australian news in language;
- a soft power asset as Australia’s face at Eurovision, showcasing Australian talent and diversity to 186 million people worldwide;
- a trusted national voice for First Nations media; and
- a building block for social cohesion in our diverse multicultural nation.
Further, Community television is more than just a local broadcaster. In the cities in which it still operates it is:
- a training pathway for future screen practitioners, including people with disability;
- a tertiary institution partner for student coursework; and
- a local production facility for local councils and community groups, among other things.
Each of these platforms also contribute to the creative industries, including the screen production sector.
What is striking is the effort this Government has gone to, to wreck and undermine some of these platforms and to destroy the value and potential they hold.
Last year, the Liberal Federal Council voted overwhelmingly to privatise the ABC.
That came off the back of Coalition Government budget cuts to the tune of half a billion dollars, in breach of a specific election promise not to cut the ABC or SBS.
Australians don’t take kindly to being lied to about the institutions in which they have invested, and in which they trust.
Similarly, the Government decided to send Community TV over-the-top, to an online only delivery model, without enough time to make the transition.
In doing so, they failed to appreciate that online services complement, rather than replace, broadcasting services and that it is the broadcasting service that provides the anchor to local community.
Now more than ever, Australians need strong and vibrant commercial, community and public broadcasters, operating across platforms, to ensure diversity in our media voices.
Of course there are other major platforms in the portfolio, including the digital platforms.
The preliminary report of the ACCC’s Digital Platforms Inquiry is a commendable piece of work that, in some ways, shows we’ve come full circle on the question of whether the media regulatory framework needs updating.
Clearly, as the Convergence Review report published towards the end of the last Labor Government recommended, an overhaul is necessary.
Whoever wins the next election may well pick up where the Convergence Review left off – and the policy challenges will have been circumnavigated, if not resolved.
That said, I acknowledge the broad range of issues explored in the preliminary report which, among other things, also demonstrates there are standard and novel competition issues and ideas in play that warrant further examination.
As a former telco lawyer, I spent ten years arguing about the regulation (or not, depending on the client) of terminating access charges. I could grapple with a cost plus model, the idea that you would recover your costs and retain a reasonable retail margin, but it would be for the regulator to test the reasonableness of how this figure was derived.
Reflecting on that, as well as the browser wars of the late 1990s, got me wondering: why did governments (and regulatory best practice as a whole) act sooner back then, but later about digital platforms?
I think there is a sense, now, that governments left digital platforms to grow and innovate because they were so transformative and pervasive, and nobody wanted to be the person to stifle innovation.
It is easier, perhaps, to get your head around the implications of a choice between browsers or terminating charges, and less straightforward to grapple with a change of this scale.
However, now there is a view that the digital platforms, once the disruptors, are now themselves so big, so vertically integrated, so (as some would argue) monopolistic in their behaviour, that they’re stifling innovation in some respects.
The clear sense I have is that it is up to governments to use the regulatory frameworks they have, and adapt them where necessary.
Clearly, there are some areas of competition law that possibly should have been utilised by now. We shall see, as the ACCC progresses its work.
But there has also been a maturation of the debate around traditional media vs digital platforms. We’ve moved on from ‘the platforms are bad and the old media are dummies’.
Australia has been having reasonably nuanced debates about regulation and the online environment for a good 20 years.
Now we’re seeing much more sophisticated plays from the content sector and the digital platforms.
We’ve got the platforms demonstrating their commitment and support for news by trying to help them evolve and adapt to the new environment – an even giving some ground on its first click free policy.
And we’ve got the content sector demonstrating that they are innovators, they care about their content and the ecosystems they’re within.
All this will play out.
The staff of the ACCC have a great deal to work through as they prepare the final report.
Labor, meanwhile, is very focussed on the future of public interest journalism.
We are concerned about the health of the fourth estate, the large loss of jobs in journalism in recent years and the ongoing consolidation of the news media.
In Australia’s highly concentrated media market, the democratising power of the digital platforms is potentially very useful, and it goes without saying that the innovation ushered in by digital platforms has enriched our lives.
It is heartening to see a range of philanthropic developments materialise in support of journalism, including the Judith Nielson Institute for Journalism and Ideas, and the announcement by John B Fairfax of a new investigative news site.
I applaud the efforts of the platforms and the content producers to partner, innovate and adapt to forge new pathways to support
That said, our content industries are such a vital underpinning of our cultural expression and national identity, as well as the health of our democracy, that Labor must be satisfied that our local content producers are getting a fair deal.
So if content makers are innovative, and digital platform are pro-news, what’s the missing piece?
I suspect it is that we still don’t have an agreed playing field, let alone a level one.
The media is in transition and, to the extent there are some anti-competitive effects of the size and scale of the digital platforms’ success, then that needs to be examined.
The regulators need to be involved too.
Regulators need to understand this new environment, they need to apply the regulation they have and they need to adapt it, where necessary.
To that end, on the question of algorithm transparency, I do not see it as a case of knowing what the secret recipe is but, rather, simply knowing whether it’s harmful or not.
If the digital platforms aren’t the baddies, and news publishers aren’t the dummies, then nor is government regulation the enemy of innovation.
Well-crafted policy and regulation doesn’t, of itself, stifle innovation or the future; it shapes it and provides the transparency and predictability to actually encourage investment and innovation.
I sincerely appreciate your attendance here tonight. The last time I addressed this auspicious gathering it was as the Member for Greenway, re-elected with positive swing against the odds in 2013 on the back of some good luck.
I hoped in that address to demonstrate that no-one knocks back a bit of luck, but it took a lot of hard work to get there.
Similarly, I have been very fortunate to be entrusted by Bill Shorten with a portfolio that is my passion and was my professional life before public office. I am even more fortunate to have maintained the mentoring and confidence of some of the smartest people I know whom I worked with or for over a decade as a lawyer, and nearly a decade since moving to this new life.
I’m very mindful that I am putting myself forward as the alternative Minister for Communications in a Shorten Labor Government. I hope my comments tonight have provided some food for thought on how I would approach the portfolio and its stakeholders, including that most important of stakeholders: the citizens of Australia:
- A smart strategic focus
Make no mistake: the next federal election will be a close-run thing. As I’ve said before, addressing inequality and improving the lives of working people is Labor’s defining mission.
And a key part of that mission is to promote fairness and prosperity in a disrupted, broadband-enabled world. Growth and innovation is the goal, and it must be inclusive. To achieve that requires strong leadership and vision for a better Australia.