editor’s note

A case of Broadband Déjà Vu

The first Information age, according to the book of Genesis, occurred when Adam ate from the tree of knowledge. The immediate consequences of that first Information Age was the fall from grace and expulsion from the Garden of Eden.

As we enter the second Information Age, with the serpent of Mammon at our side, it is worth pausing—just before we take a byte from an even bigger Apple—and asking whether new material and moral catastrophes lie in store for us beyond the Gates.

The prospect facing us is that information may turn out to be the final commodity. After all, what else is there left to sell? New commodities and new markets are increasingly difficult to find.

We have created markets for the space on the ground, for things we can dig out of the ground, and for virtually everything we can grow in the ground. We sell all manner of living creatures, including ourselves. The seas are being systematically plundered, and even our atmosphere can be sold. We sell sunshine, moonlight, the stars, and beyond. Not even God has escaped marketing. Suitably transformed by manufacturing and packaging, virtually anything which can be is being sold, and resold for a higher value. That is the nature of the ever rapacious marketplace, constantly seeking new ways of turning a buck.

With a lust for new frontiers of selling, the contemporary entrepreneurs boldly go where no salesman has gone before. The ultimate challenge, to discover the ultimate market, has been met by the discovery of the ultimate commodity—information.

We are being told that our first duty is to get a ticket to ride the information superhighway. Following time-honoured marketing practices, we are being softened up and prepared for this new commodity by a mixture of colourful exaggeration and simple lying, and information junkies luring us with tales of cyberspace. The information superhighway is preceded by the superhypeway.

This process of softening up the market is not a monolithic, highly integrated marketing strategy. There is no grand conspiracy at work. Rather, there is a convergence of economic interests, technological optimism, and intellectual opportunism around a single area, like a vortex occurring at the point where different currents meet. In a sense we all contribute to the vectors that shape the spiral; we make the current and are drawn by it. The marketplace—both sellers and buyers—must be mobilised and primed before a new commodity can be sold. Before we are ready to buy information we must believe that we live in an information society; we must believe that information is a commodity; and most importantly—in order to consummate the sale—we must believe that we need information in order to survive and prosper.

Once we are ready and primed, once the serpent has successfully tempted us, we will buy. But how much is it going to cost us? What is the price we will have to pay for the tempting fruit?

One of the great ironies surrounding this dawning information age is the simple absence of information that might guide us—not unlike our innocence in the garden.

Not even the Bureau of Transport and Communication Economics can get hold of real data on telecommunications costs. Their recent Work in Progress Paper No 1: Emerging Communication Services: an Analytic Framework is a clear example of absent information. When Telecom was a monopoly, such data was available. However, in our competitive information society, information is not shared, it is withheld, kept secret. Such is the irony of our times.

But we can make some guesses by looking at some of the projections. Paul Rizzo, from Telecom, speaking at the recent ATUG conference, said that Telecom expects to spend $20 billion on carrier infrastructure in Australia over the next five years. Infrastructure in this case means all the fibre optic cables and the digital processing technology that will carry the commodities of the information age into our homes and offices. If Optus and all the other players, in a spirit of competition, build some of this infrastructure to capture the market, we might estimate (again in the absence of information) that they may spend half as much again—another $10 billion. It will therefore cost $30 billion to build the infrastructure—lay the fibre optic tarmac of the information superhighway. But this doesn’t cover the cost of providing services along the highway. Again, in the absence of information let us suggest a further $20 billion to provide information products and services to run along the highway. We end up with a figure of $50 billion as the cost of putting it all in place.

How is this to be paid for? Again there is no publicly available information, despite the fact that we have so far spent over $10 million of public money in Australia on research into social and economic aspects of information technology. In none of this research is there any evidence to suggest that a large enough market exists to pay for the superhighway. Let us therefore do some simple arithmetic and see how much we are going to have to pay for our access and use of the information superhighway.

Let’s assume that the carriers and service providers will aim for an annual gross income of 10% on their investment, that is $5 billion per annum. Let us also assume that this is going to be a service for everyone, as the salespeople keep telling us. Everyone will share in the benefits, so in the user-pays society, everyone will pay. In Australia, with a population of 17 million, each person will have to spend about $294 per annum more on information services and products. For the family with two children the figure would be $1,177 per annum. Looking at this from the profit side: Telecom today makes an annual profit in the vicinity of one billion dollars. Overall profits from telecommunication will have to increase fivefold to pay for the superhighway and its services.

This is a huge increase, and, to repeat, there is no evidence that we are prepared to spend this much on information services. We do not even pay for the full cost of many of the services we receive now, such as television, newspapers and email. Many will therefore opt to stay away from the highway. But if some are not prepared to pay—not be seduced by the serpent and forgo the pleasures of the highway—the rest of us will have to pay an even higher price. This is an appalling prospect. Many of the information services that today we take for granted as a right will become commodities beyond our reach. We are already seeing the trends—look out for higher charges on government information, libraries, electronic banking, email, and bulletin boards.

Reality may turn into a nightmare. As the costs soar, many of us will be reduced to information beggars by the side of the highway, eager for the crumbs of information thrown to us from philanthropic travellers and the powerful owners interested in controlling us.

Starved of information, expelled beyond the gateway to the highway that offered an information paradise, we will turn to face each other. Our discovery of nakedness during the first information age will be replaced by our discovery of ignorance in the second. Ignorance like innocence will turn to shame and greed. When the child asks its parent “why?” the parent—knowing that information is a commodity—will say “how much will you pay me for an answer?”. With our own culture a commodity beyond our reach, passing on knowledge between generations will become a dismal trade. While the powerful argue over who owns which metaphor, we will look at each other and say “am I my brother’s teacher?” All this may await us beyond the Gates unless we challenge the gods.

In our time, we make our own gods. Government policy is the hand which fashions the clay we may later come to worship. The signs and portents are there in our absence of information. Policy research to fill that gap may yet save us from expulsion. If we ask the right questions now, we might be saved from our own ignorance in the future beyond the Gates.

Sadly, there are no well funded independent research programs free of commercial or government interest, that could ask these questions on our behalf. Telecom gives most of the funding and therefore controls most of the research agenda in this area. Moreover, through its Social and Policy Research Fund, and its funding of the Centre for International Research in Communication and Information Technology (CIRCIT), it has recently moved to ensure that such research serves its strategic interest. When the builders of the highway also control the information about the social and economic costs of the highway, we should all be concerned.

In five years time we may wake up to a large bill, telecommunication may have to be renationalised to avoid commercial collapse, and we may look back fondly to today’s information paradise, forever barred to us behind the toll Gates of the information superhighway.

Adam & Eve 7(3) EPS