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Townsville City Digital Economy Strategy May 2013 1

TownSvillE CiTy DigiTal EConomy STraTEgy

May 2013


aCknowlEDgEmEnTS

The Townsville City Digital Economy Strategy (TCDES) acknowledges the assistance provided by the Townsville City Council, the Queensland Department of Science, Information Technology, Innovation and the Arts, Regional Development Australia Townsville and North West Queensland, James Cook University, and other key stakeholders in the Townsville region.

This Strategy is an initiative of Townsville City Council supported by the Queensland Department of Science, Information Technology, Innovation and the Arts, Regional Development Australia Townsville and North West Queensland and James Cook University.

Initially prepared by David Ives Principal Consultant Mach Technology Group Pty Ltd, the TCDES was finalised by the working party in May 2013 for presentation to the Broadband for the Tropics Committee for endorsement.

For more information contact:

Economic Development & Strategic Projects, Townsville City Council

Phone: 1300 878 001

Email: [email protected]


EXECUTivE SUmmary


EXECUTivE SUmmary

Recent advances in digital technology and software have caused major changes in our personal and business lives. In the recent past, these changes have occurred predominantly in physical devices, in information storage, and in software systems. Telecommunications services have not kept pace with the dramatic improvements in other information technologies (IT).

However, telecommunications are now starting to change rapidly. The widespread deployment of high-speed wireless and optical fibre broadband networks across the world is driving the development of new IT architectures, including sensor networks, handheld devices, software applications or ‘apps’. This new IT ecosystem is enabling new applications and new business models.

The Australian Government’s announcement of the National Broadband Network (NBN) has caused renewed interest in broadband technology and how it can be used to improve our lives. The Townsville City Digital Economy Strategy (TCDES) considers the impacts on Townsville and Northern Queensland, and presents some strategic initiatives that should help Townsville to leverage its advantages as the first location in Queensland to receive significant NBN coverage.

The NBN uses optical fibre-to-the-premises to deliver speeds of up to 1,000 Megabits per second to 93 per cent of premises across Australia. Fixed wireless and next-generation satellite will be used to deliver services to those premises not connected to the optical fibre network. The speed of the NBN is up to five times faster than most existing broadband services. The availability of high-speed broadband data connections will stimulate new applications across a wide spectrum of business, residential and social activities. Many of these applications will use a broadband connection to the Internet, but the NBN can also provide connections to other networks such as telephone, medical, education, entertainment, energy saving, and security networks.

The scope for these new applications to change our lives is difficult to estimate, and many people have underestimated the impact of technological change in the past. A number of technologies have started slowly but eventually caused dramatic change – the telephone, personal computers, mobile telephones, and social media – are some examples. Like most technology change, the most important aspect of the broadband revolution is not the technology itself, but the potential uses it will deliver to the way we work and live.


A number of recent studies have estimated the benefits of the digital economy using high-speed broadband to improve economic outcomes. Access Economics estimates that if 10 per cent of Australians were to telework for 50 per cent of the time, the total annual gains would be in the order of $1.4 - $1.9 billion per annum.

Businesses generally will benefit from online participation through three main activities: online transactions, selling online through eCommerce; online marketing, the use of online technology to identify and sell to new markets; and online collaboration, working with suppliers, partners and customers to improve efficiency and outcomes.

The benefits of the digital economy extend beyond the general benefits to business and visitors to cover virtually all sectors of the economy:

1. Regions are likely to benefit through improved connection to other regions and capital cities, and the more widespread use of high-quality video conferencing and collaboration.

2. Sustainability may be improved through the reduction in the need to travel and the improved capability to manage our impact on the environment through extensive sensor networks and automation.

3. Construction and manufacturing may benefit through the use of online technology such as cloud computing to manage collaboration and information resources.

4. Health and aged care are already benefiting from advances in remote monitoring technology and this trend will accelerate, reducing costs and improving care.

5. Education is already benefiting from remote access and, as technology improves, the use and benefits of online education will increase, especially in regional areas.

6. Research and data analytics have the potential to extract valuable information from the large data sets being generated by sensor networks in industries such as agriculture, mining and environmental management.

7. Remote working has the potential to reduce travelling expenses and return injured workers to the workforce while improving productivity.

8. Mining and minerals processing industries are already starting to use remote operation technologies to remove people from hazardous areas and improve productivity.

9. Employment will benefit from the construction phase of the NBN and from the new businesses that are likely to grow in the digital economy.


10. eGovernment has the potential to streamline the provision of government services and benefit consumers and business.

A number of strategic initiatives (19) have been identified within the Townsville City Digital Economy Strategy (TCDES) to assist the development of the digital economy in Townsville.


ConTEnTS

Townsville City Digital Economy Strategy Strategic Initiatives 8

Introduction 12

Strategic Context 16

Benefits of the Digital Economy 25

Strategic Initiatives 38

Implementation and Governance 48

Conclusion 50

Appendix 1 – Abbreviations 52

Appendix 2 – ICT Trends 53

Appendix 3 – Pilot Projects 60

Appendix 4 – Agreed Terms of Reference – Implementation Committee 64


TownSvillE CiTy DigiTal EConomy STraTEgy STraTEgiC iniTiaTivES


TownSvillE CiTy DigiTal EConomy STraTEgy STraTEgiC iniTiaTivES

1 – Building Infrastructure Research

JCU and industry leaders to develop and encourage the use of new infrastructure and Building Management Systems (BMS) solutions so that new applications education, sustainability, health and aged care delivery are not limited by inadequate facilities or buildings.

2 – new application Development

Support the research and development of new applications by partnering with business, industry associations and government, to sponsor promotional opportunities such as competitions and internships.

3 – work Experience and internships

Create opportunities for graduate work experience or internships to improve industry linkages and development, and reduce the loss of skills from Townsville.

4 – Community Engagement and Education Campaigns

Engage and develop digital and online literacy campaigns for the commercial and community sectors, in the digital economy journey, through awareness seminars, marketing campaigns, social media, demonstrations and pilot projects including utilising the role of the Community Hubs.

5 – Smart Directory and Online Collaboration

Establish a smart directory for the region to assist with business matching and collaboration, in conjunction with the Townsville ICT Business Network, Industry Capability Network (ICN), relevant Queensland Government departments, Townsville Enterprise Limited and other interested parties.

6 – Cooperative Work Centre

Establish a trial cooperative work centre (smart work centre) in a suitable location to study the effectiveness of the centre in reducing commuting imposts and encouraging collaborative working.


7 – Remote Mining Operations

Investigate the establishment of remote mining operations in partnership with North Queensland mining and refinery operators.

8 – Investment Attraction

Attract catalytic digital enterprises to Townsville through the use of targeted investment attraction methods and incentives, collaborative research and investment programs.

9 – Building Business Capacity

Assist business by identifying and delivering educational services that improve business processes using digital tools, and develop collaborative partnerships to identify and develop local capabilities.

10 – Council Services Online

Townsville City Council will continue transition services to an online environment through its e-business, e-property and e-services initiatives.

11 – Council as a Service Provider

Townsville City Council to collaborate with other regional councils to develop on-lined shared service delivery to improve the level of service to the ratepayer. This investigation should consider a range of offerings covering Platform-as-a-Service (PaaS), Applications-as-a-Service (AaaS) and Software-as-a-Service (SaaS).

12 – Cloud Computing Adoption

Townsville City Council, James Cook University and other major organisations to actively participate in the development of local cloud computing opportunities such as the NQ Data Centre and Code Valley initiatives.

13 – Health Service Delivery

Extend the Diabetes trial and consider other health and aged care applications as future trials. Potential applications include:

o Operating teleconsultations to rural and remote communities

o Operating teleconsultations and procedures between Townsville Hospital and other specialist hospitals

o Using sensors for monitoring health and wellbeing


14 – Use of Public Libraries

Expand the work and role of public libraries to develop the community’s digital access and education services.

15 – Cabling of New Premises

Townsville City Council to work with industry to educate and encourage developers and builders to provide new buildings with best practice cabling (including minimum Cat 6 structured cabling from a wiring hub to all points according to current design standards).

16 – New Defense Housing

The Defence Department should be encouraged to ensure that the design and internal cabling of new defence buildings complies with current best practice (including minimum Cat 6 structured cabling from a wiring hub to all points according to current design standards and serving multiple applications such as power management and water management).

17 – Demonstration Smart House

Develop or modify an existing demonstration Sustainable Smart House in conjunction with local builders and suppliers to show how a smart house can work with the NBN, showcasing applications like eHealth, smart grids, high-bandwidth entertainment, sustainable living and teleworking.

18 – Collaboration Between Regions

Encourage collaboration between Townsville and other centres across North Queensland using the work of JCU and NICTA, under the guidance of Broadband for the Tropics.

19 – Intelligent Community Forum

Townsville to progress with an application in 2013 to be an Intelligent Community, with the aim of securing a place in the Smart21 (Applications close September 2013). The application would be a valuable benchmarking exercise for the city


inTroDUCTion


inTroDUCTion

Background

The Commonwealth Government has set a goal that by 2020 Australia will be among the world’s leading digital economies.

Ensuring that Australia becomes a leading digital economy will improve our productivity, maintain our global competitiveness and improve our social wellbeing. The Australian Government’s commitment to build the enabling infrastructure for the digital economy, the National Broadband Network (NBN), is a key step towards this vision1, nationwide.

The NBN is a next-generation national broadband network based on three

1 Australian Government, Department of Broadband, Communications and the Digital Economy—National Digital Economy Strategy, 2011

Photo provided by © State of Queensland


technologies – optical fibre, fixed wireless and next-generation satellite. Work has begun on the NBN, and by the end of 2021, NBN Co plans to have connected all Australian premises to this new high-speed broadband network2.

Under the NBN, 93 per cent of Australian homes, schools and businesses will have access to optical fibre-to-the-premises (fttp), capable of providing speeds of up to one gigabit per second (1000Mbps).

A further seven per cent of premises will have access to the NBN through next-generation fixed wireless and satellite technologies, providing peak download speeds of 25 Megabits (Mbps) per second and 5 Mbps upload.

Townsville has been selected as an NBN first and second release site with planning for close to half of Townsville premises having access to NBN connection by the end of 2013. Its selection provides Townsville with first user advantage over other Australian cities the TCDES will assist Townsville to maximise this advantage and provide the foundation for continued leadership in digital collaboration.

Objectives and Scope

The objectives of the Townsville City Digital Economy Strategy are:

o To maximise and maintain the opportunities presented by Townsville’s selection as a first release site for the NBN and one of the most connected communities in Australia.

o To develop and maintain a blueprint for the future development of the digital economy of Townsville within the framework of the broader Townsville City Economic Development Plan 2013 -2017.

o To inform and guide government decision-making in relation to planning processes and development functions in the North Queensland region.

o To inform and guide business, organisations and the community in relation to advances in digital infrastructure and the digital economy.

The scope of the project includes the following activities:

o Identify the current digital footprint within the city.

o Identify key stakeholders in the development of a digital economy and formulate strategies for engagement.

o Identify business and industry opportunities to be facilitated through advances in digital infrastructure.

2 Department of Broadband, Communication and Digital Economy


o Develop strategies to enable greater uptake of broadband and digital infrastructure and technologies.

o Identify the projected future digital footprint of the city.

o Identify means to position Townsville as a site for industry to develop and establish technology-based businesses.

The TCDES considers Townsville within the greater North Queensland context (Mackay through to Cairns), as well as the broader Queensland and Australian contexts.

New Concept

The digital economy is a relatively new concept that is impacting most business, social and personal activities and extends opportunities currently undertaken in economic development.

The TCDES explores key concepts of a digital economy and their likely impact on our lives. Because of the breadth of the impact of the digital economy it is not possible to cover all circumstances. The recommendations and strategies within this report are high level and will require further work before implementation.

The path of technology and its applications is not straightforward, and the pages of history are littered with ridiculous predictions made by experts. Any digital economy strategy must be mindful of the uncertainty involved in predicting and mapping the future. Experience suggests that technology-based changes often take longer than expected, but when they occur, produce more far-reaching and faster changes than predicted.


STraTEgiC ConTEXT


STraTEgiC ConTEXT

Townsville is Queensland’s largest city, outside the state’s south east corner. Acknowledged as the capital of North Queensland, Townsville lies at the centre of one of Australia’s fastest growing economic zones.

Industry diversity, government investment and major infrastructure underpin Townsville’s role as the manufacturing, transport, commercial and services hub for the region’s minerals, coal, agriculture, tourism, education and tropical sciences sectors.

High capacity rail and road networks, and the third busiest Port in Queensland connect the North Queensland region to national and global markets.

Townsville’s industrial diversity, high-value trade and international focus position it well to capitalise on the NBN roll-out and to become a leader in the development of the digital economy.

The NBN will contribute to productivity, competitiveness and resilience, and will provide the impetus for continuing strong growth in the wake of global uncertainty.

Positioning and Context

Townsville’s selection as an NBN first release site has created significant local interest in broadband and the digital economy. This has resulted in increased activity by various groups with similar interests and objectives. The TCDES is not intended to impede or exclude any initiatives, but will provide direction and impetus for the development of the digital economy across the city. Advances in the digital economy are unlikely to dramatically alter the structure of Townsville’s economy; however, it will impact and improve how industry and enterprises operate.

The Townsville City Economic Development Plan 2013-2017 sets out a path for growth by preparing strategies for several core drivers of industry and new enterprise. These are:

o Precinct development (including tourism precincts).

o Infrastructure development.

o Business support and skills development.

o Marketing and investment attraction.


Underpinning these strategies is a vision of balanced economic growth expressed by the Townsville Economic Development Scorecard.

Formulated in consultation with local business, industry and relevant government agencies, the Townsville Economic Development Scorecard will guide assessment of the strategies contained within the Townsville City Economic Development Plan 2013-2017 and help build a better platform for planning and investment into the future.

Current Digital Footprint of Broadband

The availability of broadband in Townsville is similar to most Australian regional cities. Townsville has ADSL and ADSL2+ services in most areas. These services are subject to restrictions, including the impacts of distance from the exchange and the use of RIM3 technology by Telstra.

Other broadband services include mobile broadband (3G and 4G) from Telstra, Optus and Vodafone (including their network resellers) and fixed wireless

3 Telstra previously deployed Remote Integrated Multiplexers (RIMs) to provide services to new housing developments (such as Annandale). The use of this technology has prevented the delivery of ADSL and ADSL2+ services to all residents in an area because of the limited capacity of the RIM. RIMs have also limited the competitive market by preventing competitors of Telstra from delivering services from the RIM.


broadband from a number of Internet Service Providers. There is no cable4 broadband in Townsville and the ADSL2+ services offer speeds of up to 25 Mbps download and 1 Mbps upload. However, speeds of less than 10 Mbps and 1 Mbps are common, especially for users who are some distance from the exchange.

The National Broadband Network (NBN)

The roll out of the NBN will determine the future digital footprint of Townsville. Australia-wide, the NBN will provide the capability of high-speed optical fibre broadband to more than 93 per cent of premises and 25 Mbps fixed wireless or satellite broadband to all other premises.

The optical fibre network will use Fibre-to-the-Premises (FttP) to deliver up to 1,000 Mbps download and 400 Mbps upload speeds for subscribers to high-speed services. The decision to subscribe (or not) to broadband services will be made by the owners of premises. All premises within the optical fibre footprint will have their basic telephone service delivered over the NBN fibre connection with current copper telephone connections terminated 18 months after the NBN is activated within that area. Premises within the fixed wireless or satellite footprint will not have their copper connections terminated.

NBN Co is a Layer 2 wholesale network service provider, with Retail Service Providers (RSPs) delivering services using the NBN as a wholesale carriage network. The NBN will provide connectivity from the Point of Interconnect (PoI) at Townsville exchange to the customer; RSPs will connect their services at the PoI.

Townsville was selected as both a first release site and second release trial NBN site. The first release passed 2748 premises within parts of the suburbs of Mundingburra and Aitkenvale. Limited services, based on the needs of residents and small business, are available in the first release site. This will expand over time to include services suited to the needs of medium to large enterprises and institutions (including commercial, residential and multi-dwelling units).

NBN will provide optical fibre-based services to most premises in Townsville in the near future. As a result, the digital footprint will increase to close to 100 per cent of the city, with just a small percentage of premises having NBN fixed wireless or NBN satellite services operating at up to 25 Mbps download speeds.

4 Hybrid Fibre Coax (HFC) is used by Optus and Telstra in most of the capital cities and some larger regional cities to deliver pay television and broadband..


Figure 1 - First and Second Release

Further information on the NBN roll-out is available from www.nbnco.com.au/rollout

Broadband usage in Townsville

In 2010, the former Queensland Government completed a survey of businesses in the first release site of the NBN. The purpose of this survey was to examine business knowledge of and attitudes towards the NBN and the digital economy. The results of this survey provide a useful snapshot of business readiness for the digital economy.

The report5 concluded that:

1. 72.3 per cent of businesses had not taken any training to improve their awareness of online business opportunities.

5 Townsville Business Survey to Assess NBN Impact, AEC Group, Version 1.1 June, 2011

http://www.nbnco.com.au/rollout


2. 45.7 per cent of businesses believe they are not using the Internet to its full potential.

3. The most common barriers to using the Internet to its full potential were lack of time (39.3 per cent), lack of technology or understanding (36.1 per cent), and low Internet speed (31.1 per cent).

4. 70.6 per cent of businesses believe that government has a role in identifying, developing and promoting training programs to maximise NBN-related benefits.

The sample for this survey was limited to the first release area only. Caution should be taken in extrapolating these results to the broader business population. However, the survey is useful in providing a baseline to track participation in the digital economy as the NBN is rolled out and gains acceptance.

The connection rate for Townsville residents in the first release area was 44 per cent which followed NBN Co seeking consent to connect the network to premises. From a total of 2748 homes passed, 1217 had a Premises Connection Device (PCD) installed. Of those 477, or 17 per cent have been activated. The low response rate may be due to the relatively large number of rental properties within the area. It should be noted also that multi-dwelling units could not be connected until recently.

As of April 2013, the connection rate of the Townsville FRS has been 39.5 per cent (http://www.itnews.com.au/News/340663,nbn-cos-take-up-by-the-numbers.aspx/0)

Definitions and Assumptions

The Digital Economy

The Australian Government defines the digital economy as:

The global network of economic and social activities that are enabled by information and communications technologies (ICT), such as the Internet, mobile and sensor networks.

The digital economy includes all elements of the ICT spectrum:

o Telecommunications including fixed and mobile voice communication and broadband or data communication

o Computer hardware (fixed and mobile)

o Software technology and developments

o Internet-enabled transactions

o Service.

http://www.itnews.com.au/News/340663,nbn-cos-take-up-by-the-numbers.aspx/0

http://www.itnews.com.au/News/340663,nbn-cos-take-up-by-the-numbers.aspx/0


The digital economy is generally defined as that part of the broader economy that use ICT as a critical enabler – particularly if it contains an online or networked component. For example, the use of a computer for Computer Aided Design (CAD) or a Programmable Logic Control (PLC) is using ICT for economic benefit. It is not necessarily the critical element, but rather a tool that has replaced a drawing board. However, the use of an online network to work collaboratively between two engineering offices using Computer Aided Design (CAD) is a good example of ICT as a critical enabler.

Notes on Broadband Performance

It should be recognised that the advertised speed of a service does not fully describe the quality of experience or the capability of the underlying network. Factors such as server response time, network latency (delay), data throughput (speed) and the variability of data throughput due to contention ratios, all contribute to the overall experience.

No particular specification is used for broadband in this report. Rather, it is considered to be all services delivered by technologies such as ADSL, ADSL2, ADSL2+ and various wireless and mobile services. For the purposes of this report mobile broadband is included under the general term of broadband. The term high-speed broadband is used to describe the broadband services delivered by networks such as the NBN.

Economic Profile

Townsville’s economy has displayed strong and stable performance over the

past decade, benefiting from significant population growth, new public sector investment, linkages to the minerals industry, its increasing capacity as a hub for tropical sciences and the growing role of the City as a public and private sector regional service centre. The estimated resident population of Townsville as of 30 July 2012 was 180,389.

Table 1: Population Forecasts for Townsville

year low medium High 2016 209,472 216,524 223,8082021 227,566 241,684 255,8342026 246,091 268,330 290,1042031 263,870 295,578 325,929

Source: AECgroup (2013)

Even in the face of global uncertainty, Townsville’s economy has enjoyed strong growth with its performance supported by significant industry diversity. Since 2006-07, Townsville’s economy has increased by 6.6 per cent on average per


annum (nominal GRP at factor cost). This rate is approximately 0.8 percentage points higher than that for the State of Queensland over the same period. In 2010-11, Townsville’s Gross Regional Product (GRP) was estimated to be $10.7 billion. This represents 82.2 per cent of the Northern Statistical Division’s (SD) GRP ($13.1 billion) and 4.0 per cent of Queensland’s Gross State Product, or GSP ($266.6 billion) in 2010-11.

Figure 2: Townsville’s GRP – 2005-06 to 2010-11

$12,000

$10,000

$8,000

$6,000

gr

P (

$m

)

$4,000

$2,000

2006/07 2008/09 Townsville

2007/08 2009/10 2010/11$0


The diversity of Townsville’s economy is built upon an industry base in which no one sector contributes more than 17.6 per cent to GRP.


Figure 3: Contribution to Gross Regional Product, Townsville 2010-11

Public Administration and safety

Construction

Ownership of dwellings

Health care and social assistance

Manufacturing

Taxes Less Subsidies

Transport, postal and warehousing

Rental, hiring and real estate services

Retail trade

Education and training

Professional, sceintific and technical services

Information media and telecommunications

Mining

Other services

Accomoodation and food services

Wholesale trade

Financial and insurance services

Electricity, gas, water and waste services

Administrative and support services

Arts and recreation services

0.7%

17.6%

11.8%

8.3%

7.6%6.9%6.7%

5.2%

4.5%

4.5%

4.2%

3.5%

3.3%

2.6%

2.4%2.2%

2.1%2.1%

1.7%1.2%



bEnEfiTS of THE DigiTal EConomy


bEnEfiTS of THE DigiTal EConomy

The benefits of the digital economy are being widely discussed as a result of the focus provided by the NBN roll-out. A number of studies have demonstrated the potential benefit. A recent study by Ericsson6 found that doubling the broadband speed for an economy increases GDP by 0.3 per cent. Access Economics estimates that if 10 per cent of Australians were to telework for 50 per cent of the time, the benefit to the economy would be more than $1.4 billion per annum6.

The specific benefits to Townsville are related to the unique position of the city, as the de facto capital of North Queensland, and as a commercial hub for minerals, coal, agriculture, manufacturing, transport, tourism, education and tropical sciences industries – and the status of Townsville as a first release and second release trial NBN site.

Another major benefit of the NBN is that it will make broadband available at all premises on reasonably equal terms. For Townsville, this means an end to the numerous black spots where high-speed broadband is either not available or affordable. The digital economy works best when there is wide coverage of the population with fast and affordable broadband.

The higher speeds and increased capacity of the NBN broadband speed will lead to the development of new applications that take advantage of speed and accessibility. The impact of these new applications will be felt across all industry and consumer segments.

In social terms the NBN and digital economy have the potential to improve linkages and inclusion, and to create opportunities to better deliver education, health and aged care services.

One of the many benefits of the development of the NBN is increased connectivity between people and organisations.

The digital economy has the potential to improve social inclusion — provided that education can be delivered to increase digital literacy7. Widely recognised as community hubs within community ecosystems, Public Libraries provide a critical role in connecting with and informing the community.

6 Impacts of Teleworking under the NBN—Access Economics, July 20107 Digital literacy is the term used to describe a person’s ability to use computers, software programs, online content, and to interact with others using online tools such as social media (e.g. email and Facebook).


Case Study - The Townsville Digital Community Hub project, which is funded by the Department of Broadband, Communications and the Digital Economy, demonstrates that social improvements can be generated by digital economy development activities.

The Digital Hub, which operates across all three public library branches at Aitkenvale, Thuringowa and Flinders Street, provides free public access to more than 50 PCs connected to the NBN. They also include a Skype lounge and publicly available videoconferencing, all supported by an extensive range of training programs. These training programs range from basic computing and internet through to digital life skills training, including internet banking, shopping, social media and content creation.

Business

Business will benefit from online participation through three main activities: online transactions, online marketing and online collaboration.

The rapid rise in the use of online retail is an example of the potential of eCommerce and eFulfillment to impact on business. (eFulfillment is not available to all businesses)

eCommerce allows a firm to conduct transactions with customers and suppliers from any location and at any time without physical contact or proximity. The added flexibility gives access to much broader demand-side and supply-side markets.

For those businesses that can use couriers to deliver products, or deliver goods electronically (e.g. software), there are opportunities to improve service and reduce cost. Businesses that have staff in the field can use online despatch systems to manage staff more effectively. The use of a variety of digital tools opens opportunities for improved workflow and productivity in a cost effective manner.

Case Study – An arts and crafts retailer in a small North Queensland town serves customers all over the world through their online retail operation. They are able to enjoy the lifestyle offered by a small picturesque North Queensland town, take advantage of low rents, and still operate a successful business. Their only issue is the poor availability of broadband services to support their business.

Online Marketing

Access to markets can be expanded dramatically for many businesses through the use of online marketing. The future development of online marketing will also allow more targeting of campaigns, offers and products. While traditional


above-the-line8 and direct marketing can achieve some targeting, there are limitations, especially for above-the-line marketing.

Online marketing has the potential to harness knowledge about individual segments and even individual customers to deliver a fully targeted message that may take account of demographics, purchase history, browsing history and physical location.

The popularity of smartphones is helping to drive online marketing because of the always-on always-connected nature of these devices, coupled with GPS (Global Positioning Systems) and the ability to deliver context-aware and location-aware advertising.

When coupled with social media such as Facebook and Twitter, the benefits can be further improved through improved targeting based on interests, hobbies and social groupings.

Social media networks can also be used by public agencies in times of crisis. The use of social media (primarily Facebook and Twitter) by Townsville City Council (TCC) and Emergency Management Queensland during the 2011 cyclones and floods is an example of highly effective two-way communication via social networks.

Online collaboration

Studies have found that regional businesses had far less contact with other businesses when compared to large city businesses9. The authors believed that this is simply because there are fewer businesses in regional areas. The NBN will allow better contact between businesses for online collaboration, finding suppliers, improving access to expertise, government services, supply chain management and establishment of branch offices.

Case Study – A Cairns-based engineering firm with an office in Townsville regularly transfers drawings between offices so that both groups can apply different skills to the same project. At the moment, because of the limits to broadband availability, the collaboration is limited to file transfers rather than a cloud solution that would allow both groups to work on one set of documentation.

Facilitating Collaboration–Smart Directories

The idea of collaboration is simple in concept – find another business that you can work with and start working together. However, finding another business

8 Mass-market advertising and marketing such as television and newspaper advertisements.9 Charlot S & Duranton G (2006) Cities and workplace communication: some quantitative evidence, Urban Studies, Vol 43, No. 8, pp. 1369-1394.


with the skills you need is often difficult. Smart directories are designed to help firms find suitable collaborators by generating listings of firms and capabilities and allowing business matching. The intelligence comes from the detailed information included in the directory. This information cannot be gathered by traditional means and requires each business to engage in a detailed survey and benchmarking process to enable their positioning in the directory.

A smart directory of Townsville and surrounding areas would provide considerable assistance in driving collaboration between firms.

Regional

Developing the digital economy in Townsville will enhance regional engagement and service delivery. Townsville, as the major business, administration, health and academic hub of northern Queensland, provides services to communities across the North and North-West Queensland statistical divisions and frequently to other major population centres such as Cairns and Mackay.

Access to high speed broadband in regional areas and connectivity to services in Townsville will enable smaller communities to attract and retain people. These communities will continue to be competitive by offering the digital connectivity and the benefits of lower costs of living in terms of housing and more convenience in terms of lifestyle. The tyranny of distance and geographical isolation will be less of an issue for businesses and individuals.

Sustainability

Sustaining the economy and environment relies on our capacity to use resources judiciously in order to minimise negative impacts. The digital economy promises a significant reduction in the use of resources such as transport, and an enhanced understanding of our environment through greater availability of information and the possibilities of corrective action and connecting actions with outcomes.

Benefits are likely to come from traffic reduction, energy use and pollution reduction resulting from teleworking. The improved management of traffic flow and routing has the potential to further reduce energy usage and pollution.

Smart grids controlling and moderating energy usage will provide significant reductions in pollution and reduce the need for the construction of new power generation capability. Smart buildings have the potential to reduce energy usage by working with smart grids to optimise the usage of energy as well as providing lifestyle benefits such as enhanced security, entertainment and ease of use.

Improved research capability has the potential to provide new solutions to environmental problems and to deliver better management solutions for agriculture. The deployment of large numbers of low-cost sensors and satellite-


based remote sensing will provide much more information to farmers on pasture cover, moisture, crop yields and stocking levels and distribution.

More knowledge of conditions leads to better management and reduced environmental damage, as well as opportunities for further study and optimisation of farming.

Case Study - CSIRO is developing a Homestead of the Future at Woodstock, at the Lansdown Research Station. The facility includes a wireless sensor network for near real-time recording of animal movement and behaviour, pasture dynamics and weather conditions.

Ecologically Sustainable Development (ESD)

The design and construction of ecologically sustainable buildings can improve living conditions and reduce the environmental impact of the building and its residents.

The use of smart wiring, combined with the automation of lighting, window coverings and treatments, ventilation, air conditioning, power management and water management can reduce the environmental impact of residential and commercial buildings. Automation systems monitor conditions around the building and control devices to maximise the environmental benefits.

For example, to reduce the cost of air conditioning, an automated system could close external shutters on the western side of the building, open heat vents in the roof cavity, and switch on only those air conditioners in rooms where people are detected. In cases where community-based stored water-cooling is in use, the automated control of the cooling is essential.

Townsville could become a world leader in tropical design if it embraces the use of digital economy-enabled design, specialising in smart infrastructure to facilitate lifestyle, entertainment, environmental management, remote working, and health management.

Construction

The use of online collaboration in the design and construction industries can provide benefits in simplifying the management of contracts, specifications and drawings, and in maintaining the currency and accuracy of documents. Already there are new businesses that offer online services for builders using ‘cloud’ computing models.

The construction industry will also benefit from major changes in building design and connectivity required to participate fully in the digital economy. For example, the need for sensor and actuator deployment in buildings of the future will assist the development of a new specialisation in partnership with the construction industry.


Case Study – Building Industry Online is an innovative Townsville-based company that offers an integrated building industry solution from a simple online access. The building and construction industry uses a large number of complex contracts and drawings that need to be accessed and modified by various designers, planners and sub-contractors. This leads to issues with data currency – ensuring that everyone is operating from the same version of the documentation. The simplest way to achieve this outcome is to use one set of documents – held centrally – and to give all parties access online to the central record. This is possible only when there is ubiquitous and reliable high-speed broadband.

Townsville is an ideal location to pilot this service using the NBN. The service can be extended to Townsville City Council to allow online submission of planning approvals documentation and development assessments. The removal of most of the paper records in this process would save time and money for the building industry and Council.

Health and Aged Care

The benefits of the NBN to the health and aged care sectors are often quoted. The use of in-home monitoring equipment that is connected via the NBN to a medical or aged care service provider, will deliver a new paradigm in health and aged care management.

A $3.76 million Townsville NBN diabetes trial currently underway in the first and second release sites is designed to help patients better manage their condition and improve their health outcomes from the comfort of their homes by remotely monitoring their condition.

In-home aged care solutions have the potential to allow residents to stay in their own homes for much longer, minimising disruption and reducing the cost of institutionalised aged care, by remotely monitoring vital signs, patient feedback and activity.

Case Study – Feros Care, a Gold Coast-based aged care provider, has realised the potential of the digital economy to improve in-home aged care by retrofitting cabling infrastructure to clients’ houses and installing monitoring devices so that residents’ health and well-being can be remotely monitored. This service significantly reduces the need for clients to move to an aged care facility.

The data speeds required are not particularly high; however, as monitoring technology improves the range of services offered will increase to allow more sophisticated monitoring and treatment, especially using video conferencing technology.


Education

There are already three online education enterprises operating in Townsville and this positions the city well to grow into a centre of expertise in online delivery of education. James Cook University (JCU) runs a distance education program for students who cannot attend in person. The University has access to AARNET (Australian Academic Research Network) that connects most universities in Australia, including the JCU Cairns campus, and provides international capacity. JCU is also part of the EduRoam consortium that offers location independent Wi-Fi connections to students through virtually any wireless hotspot using seamless centralised user authentication and enforcement of the institutional internet use policy.

Current online education tends to use browser or webinar10 technologies that can usually operate successfully at lower broadband speeds, albeit with limitations on the functions and usability. Higher broadband speeds will enable more natural and interactive environment with the ability to add high-quality video conferencing, multi-screen capabilities and gesture recognition.

10 Webinars use specific downloaded software (e.g. Citrix Go to Meeting or Cisco Webex) to establish a voice and data connection between participants and a moderator or presenter. This solution offers some advanced functions such as hand-raising for questions, chat for feedback and questions.



Research and Data Analysis

Increases in processing power and bandwidth means that our ability to analyse complex data from disparate databases is dramatically increased. Complex data sets are collected from many areas of the natural and built environment, usually by sensors, and without complex analysis these data sets are meaningless. The analysis of these very large data sets using massive computing power11 can reveal patterns and trends that can be very valuable in industries such as mining, farming and general business.

For example, the analysis of local travel patterns of tourists through various mapping techniques can identify their areas of interest and spending patterns. Further, remote sensing data from mining explorations can be analysed to indicate potential mining prospects.

Using the power of the NBN, complex data analysis or big data as it is sometimes called, can be offered as a service by any organisation or region with the skills and access to appropriate processing power and broadband capacity.

Remote Working

Smart work centres provide an itinerant or permanent workspace for people who do not wish to travel to their place of work, as an alternative to working from home. A number of services can be provided for remote workers – such as parking, air conditioning, broadband connectivity, advanced workstations, high-quality video conferencing, child care, banking, retail and catering. Smart work centres provide a safe and controlled workspace which satisfies employers’ workplace health and safety concerns.

Smart work centres or co-working centres are widely used in cities like Amsterdam, which has over 120 centres operating as commercial operations. The centres also become social and business-networking hubs with their own dedicated apps to facilitate interactions between users.

Smaller towns within North Queensland could also benefit from smaller smart work centres, opening-up a wider skills base for Townsville and employment opportunities for the smaller centres. Eventually a network of smart work centres could operate across North Queensland allowing remote working for a new breed of mobile workers.

Mining and Minerals Processing

Mining industry labour costs are high due to the shortage of suitably skilled

11 The processing may use massively parallel processing using large numbers of servers, which may be remotely connected, rather than large sequential computers using traditional database techniques.


workers, dangerous environments and the remoteness of operations. These restraints can be partially mitigated by remote operation, and the benefit of removing workers from hazardous areas is being recognised by companies in the mining and processing industries. There is an opportunity for Townsville to be a remote operations centre for many of these sites, using the capacity of the NBN and the Regional Backbone Blackspots Project optical fibre network.

Remote operation is enabled by reliable high-speed data connections that will be provided in part by the NBN, and in part by private networks. Trials of this technology are underway in the Pilbara in Western Australia and the results so far are promising. Townsville would be an ideal base for remote operations because it is close to the major mining centres in Queensland and several major processing centres, and because it has a diverse base of skilled resources.

Case Study – Google has been trialing an autonomous self-driving car in the USA for two years as part of the certification process. The car has been successfully driving itself around the country (with a driver as a safety and reporting measure only) through a combination of imaging, GPS and mapping technology. Certification has now been granted for the car to operate autonomously.

Figure 4 - What the Google Autonomous Car sees


Employment

NBN Co estimates that up to 16,000 jobs will be created nationally during construction and that 80 per cent of the workforce demand will be for labourers, cablers and plant operators.

As well as construction jobs, NBN and the digital economy will stimulate new business activity such as software development and management, content development and distribution, and support services.

Multimedia and web development specialists will be in demand to develop the content that will use fast broadband infrastructure. Although the content development industry may not be large in North Queensland, there is potential for it to grow quickly, given access to NBN infrastructure. The nature of software development is changing due to the impact of open source software and apps. The new environment created by these changes means that software development opportunities are not limited to large corporations operating out of capital cities.

Currently, there are limited employment opportunities for ICT professionals in Townsville, and JCU ICT Graduates often leave the city in search of employment opportunities. This results in a brain drain for Townsville, reduced incentive for students to study ICT locally and a limited pool of ICT skills for businesses to access. Improved employment opportunities for graduates would help to create the critical mass required to drive growth in the ICT industry locally.

eGovernment

The provision of government services online – sometimes called Government 2.0 – can save money and improve service levels. Services can include online information resources, building & development permits and information, property location and maps, planning scheme information, Council meetings and committee information.

According to the National Digital Economy Strategy12 ‘A recent report by PricewaterhouseCoopers, for the UK Government, found that face-to-face transactions cost £10.53 (about $A16), the cost of a telephone engagement was £3.39 (about $A5.15) and engagement with the government by mail was £12.10 (about $A18.40) – compared with the cost of an online transaction at just £0.08 (about $A0.12).’

Existing council infrastructure includes a significant data centre that is being developed as a regional cloud that can be used to offer commercial services

12 Australian Government, Department of Broadband, Communications and the Digital Economy—National Digital Economy Strategy, 2011


to local companies. There is an opportunity for Townsville City Council to offer services to other councils in the region using the existing resources and expertise where possible. Services such as online payments, records storage and customer management systems could be offered to other councils.

Recent publications of state and local government databases provide a model for development of the use of a range of data sets to identify new trends and understanding of systems traditionally considered disconnected. Access to new combinations of (analytical) comparisons allow this Open Data framework to encourage all interested individuals and businesses to be innovative in the way they look at and interact with the NQ environment. Interactions of individual smart infrastructure components will be enhanced as these data sets are combined and new ways of using existing (and new) infrastructure more efficiently will evolve as new perspectives are applied to the analysis of traditionally ‘closed’ data sources.

Case Study - MiTownsville Project, developed by the Townsville City Council, delivers an extensive and integrated program to expand online service and collaboration across the council and community. MiTownsville is designed to capture and implement the best available trends in connectivity to provide direct benefits to local residents and the community whilst being a catalyst for digital interaction of the community.

MiTownsville, whilst focussed on the unique characteristics of Townsville, is scalable, adaptable and replicable so that it can be used as a blueprint for other cities and communities.

Manufacturing

The manufacturing industry is set to benefit from advances in 3D printing techniques. The new technology of 3D printing allows the construction of three-dimensional parts by the successive layering of materials including plastics and metals by a printer, which is being controlled by a downloaded or remotely accessed data file. The rapid availability to a range of parts will reduce material holding and transport costs and delays, and will also allow the development of complex custom parts.

Small scale devices that can print in plastics now cost less than $1,000. However, more expensive machines can also print ceramic and metallic objects, or even composite materials. Entire houses are now being 3D printed! One Townsville firm (Bajtech) is working towards building a commercial scale 3D printer.

While not suitable for large scale or mass manufacturing, Additive Manufacturing (3D printing) is ideally suited to small runs or complex objects. This capability means that the production process can be disrupted and


individuals can do their own manufacturing; some are calling this a new industrial revolution. In any case, it is safe to assume that these devices will have a significant role to play in future business and industry. Broadband is the essential underlying infrastructure enabling this new approach to manufacturing.



STraTEgiC iniTiaTivES


STraTEgiC iniTiaTivES

The benefits of the digital economy will not flow automatically with the construction of the NBN. Significant development work is required across the community, involving a range of individuals, industry groups, businesses and government.

A range of initiatives have been proposed within eight key strategic areas identified below. Some initiatives are works in progress and would benefit by increased activity; other initiatives are new and require specific activities to launch them.

The development of Townsville lends itself to two physical hubs for the digital economy: Douglas – focussed on education, research, tropical science ICT services, health and defence; and the CBD – focussed on business, government administration, tourism, cultural services and the creative industries.

The advantage for Townsville is both immediate and short-term, although timely implementation is important to capture the advantages identified in the TCDES.

Research and Development

Strategic Initiative 1 – Building Infrastructure Research

JCU, TCC and industry leaders to develop and encourage the use of new infrastructure and Building Management Systems (BMS) solutions so that new applications such as education, sustainability, health and aged care delivery are not limited by inadequate facilities and buildings.

Strategic Initiative 2 – New Application Development

Support the research and development of new applications by partnering with business, industry associations and government, to sponsor promotional opportunities such as competitions and internships.

Townsville has the opportunity to leverage the considerable capabilities of JCU as a major research institution, capitalising on its unique position as Australia’s largest tropical city.

A number of projects and partnerships are being considered, with several now progressing. The initiatives below are examples of opportunities requiring a unified and considered approach from stakeholders across the community:


o Discovery Rise Technology and Medical precinct – connectivity of Townsville General Hospital and JCU, inclusion of industry partners

o Tropical Data Hub – Data sharing portal for research in the Tropics

o Townsville Data and tropical Knowledge and Innovation Centre

o IBM Regional Service Delivery Centre

o Townsville City Council and Ergon Smart Solar City

o IBM Smarter Cities Challenge.

o Creative industries cluster development

There are opportunities to reinforce existing areas of expertise, and to position Townsville as a centre of expertise in software and infrastructure for the digital economy. The developing Centre of Excellence in NBN Skills involving JCU, TAFE, Regional Training Organisations and Townsville Creative Technical College, is a good base for future development. The actions of this group are critical for the necessary skills development and educating suppliers about innovations and new initiatives.

At the physical infrastructure level, there is an opportunity and need to improve the quality and usability of digital infrastructure in residential and commercial buildings. Cabling within buildings will need to be of a high standard to support NBN data speeds. New developments in Building Management Systems (BMS) will provide enhanced services and improve sustainability outcomes.

Research and development into new software applications will create opportunities for software start-up companies, through greater broadband capacity and enhanced awareness and expectations of the NBN.

The existing association between JCU third year students, Townsville ICT Business Network, and the North Queensland Small Business Development Centre is a suitable vehicle for this initiative.

Due to the high cost of traditional delivery, the potential gains for health and aged care services are greater than any other industry. The realisation of the potential gains provides an opportunity for the commercialisation of research. Townsville is in an ideal position to capitalise on the existing NBN diabetes trial and the health and medical expertise resident at JCU and within local health service delivery organisations.

Education

Strategic Initiative 3 – Work Experience and Internships

Create opportunities for graduate work experience or internships to improve industry linkages and development, and reduce the loss of skills from Townsville.


Strategic Initiative 4 – Community Engagement and Education Campaigns

Engage and develop digital and online literacy campaigns for the commercial and community sectors through awareness seminars, marketing campaigns, social media, demonstrations and pilot projects including utilising the role of the Community Hubs.

Education is a critical enabling tool in the adoption of digital economy applications. For users, it provides the knowledge and skills to participate, and for business and innovators, it enables the development of new products and services.

Graduates in knowledge-based industries such as ICT and the Creative Industries have limited employment opportunities in Townsville. Consequently many leave the region and those remaining can be underutilised. The lack of local jobs discourages new entrants to ICT. The reduction in this ‘brain drain’ will build the skills base within Townsville and increase the attractiveness of the knowledge industries as an area of study and career development.

Work integrated learning, as a component of JCU ICT courses, will improve the quality of graduates and enhance the linkages with the businesses and industries that will ultimately utilise their skills.

The NBN and increased use of online services is a game changer that may be difficult for people to understand and accept. With major innovations that impact how we function as a community, there is a need to raise awareness and understanding of the benefits and value of change in all aspects of life.

Many consumers and businesses alike have a poor understanding of how the digital economy works and how it can be used to their advantage. Businesses should understand the potential of digitals tools within their business, along with how to change their business model, set-up and manage a web site, optimise search engine results, implement online payment models, and use social media. Similarly consumers need to possess basic digital literacy and understand online security so they have the confidence to engage in online commerce.

The use of social media by business is the latest in a long list of attempts to harness technology to communicate with customers. This trend is likely to continue as new media techniques evolve. Businesses that don’t keep pace risk missing major new and growing markets.

Business and Industry Development

Strategic Initiative 5 – Smart Directory and Online Collaboration

Establish a smart directory for the region to assist with business matching and collaboration, in conjunction with the Townsville ICT Business Network, Industry


Capability Network (ICN), relevant Queensland Government departments, Townsville Enterprise Limited and other interested parties.

Strategic Initiative 6 – Cooperative Work Centre

Establish a trial cooperative work centre (smart work centre) in a suitable location to study the effectiveness of the centre in reducing commuting imposts and encouraging collaborative working.

Strategic Initiative 7 – Remote Mining Operations

Investigate the establishment of remote mining operations in partnership with North Queensland mining and refinery operators.

Strategic Initiative 8 – Investment Attraction

Attract catalytic digital enterprises to Townsville through the use of targeted investment attraction methods and incentives and collaborative research and investment programs.

Strategic Initiative 9 – Building Business Capacity

Assist business by identifying and delivering educational services that improve business processes using digital tools, and develop collaborative partnerships to identify and develop local capabilities.

The advent of the digital economy will challenge many businesses through the need to access highly skilled workers. The skills required will not necessarily be accessed through tertiary education but through a combination of formal education, work and life experience. The ICT and creative industries, including games development, graphics, web development, software development and music — are likely to need exposure to work experience to develop an understanding of the skills required.

Businesses operating in the online world need to collaborate with others with complementary skills, to improve their competitive advantage. Online collaboration will give businesses access to a wider variety of skills and resources. Existing online directories provide limited information on the capabilities of a business. Smart directories can provide more detailed information, making it easier to find the right partner or supplier.

For micro businesses, it can be difficult to find collaborators and partners because they are unaware of capabilities of other businesses. Cooperative work centres – sometimes called smart work centres – provide a valuable venue for micro businesses to work and engage with similar businesses. The number of cooperative work centres is growing worldwide, with some now occupying multi-storey buildings and include their own smartphone apps to help people to connect and work collaboratively.


Cooperative work centres are also useful for larger organisations that may not have an office in Townsville. The centres normally provide desks, conference and meeting rooms, IT services, telephones, and high quality videoconference facilities for remote meetings.

High-speed connections enabled by the NBN network open up opportunities for businesses needing to operate remotely. The mining industry operates machinery in remote and dangerous environments with mines in the Pilbara remotely operating vehicles, from operations centres in Perth. With its access to mines, high-speed broadband, skills and population, Townsville is well placed to establish itself as a remote mining operations centre.

Industry structure can dramatically impact opportunities for collaboration. The presence of major enterprises with expertise in ICT and knowledge industries will help to stimulate start-up businesses, resulting in important new opportunities for the regional economy.

The targeted attraction of catalytic companies is a proven and useful economic development strategy. If it is managed and promoted well, the early rollout of the NBN could be a major catalyst for attracting new business to the region.

Government Service Delivery

Strategic Initiative 10 – Council Services Online

Townsville City Council will continue transitioning services to an online environment through its e-business, e-property and e-services initiatives.

Strategic Initiative 11 – Council as a Service Provider

Townsville City Council to collaborate with other regional councils to develop online shared service delivery to improve the level of service to the ratepayer. This investigation should consider a range of offerings covering Platform-as-a-Service (PaaS), Applications-as-a-Service (AaaS) and Software-as-a-Service (SaaS).

Strategic Initiative 12 – Cloud Computing Adoption

Townsville City Council, James Cook University and other major organisations to actively participate in the development of local cloud computing opportunities such as the NQ Data Centre and Code Valley initiatives.

As the largest council in North Queensland, TCC can also act as a service provider to smaller councils who do not have the resources and critical mass to provide online services.

A major benefit of the digital economy is the online delivery of government services, providing greater convenience and efficiencies for users and service providers alike. The TCC should take an increasing leadership role in the development and provision of online service delivery in the region.


TCC is a large ICT user with an extensive and distributed network serving the city. The example set by the Council is likely to have an impact on other users, so the adoption of digital economy services such as cloud computing is likely to encourage other entities to consider the same strategy. Similarly, the adoption of policies like BYOD (BYO Device) as part of a considered policy would be beneficial to the wider business community.

Health Service Delivery

Strategic Initiative 13 – Health Service Delivery

Extend the Diabetes trial and consider other health and aged care applications as future trials. Potential applications include:

o Operating teleconsultations to rural and remote communities

o Operating teleconsultations and procedures between Townsville Hospital and other specialist hospitals

o Using sensors to monitor health and wellbeing

The Townsville Mackay Medicare Local NBN Diabetes trial is demonstrating the future direction in health care delivery. Health care delivery is always difficult and changes to delivery methods are often time consuming, risky and expensive. Limited trials are often the best way to test and develop new delivery methods, and Townsville should take a leading role in the conduct of these trials

Social Initiatives

Strategic Initiative 14 – Use of Public Libraries

Expand the work and role of public libraries for expanding the community’s digital access and education services.

The digital divide has the potential to connect those with good skills and broadband, and alienate those without. Social initiatives aimed at reducing this divide are important in preventing social and economic disadvantage.

As community centres for life-long learning, public libraries play a central role in educating the community. Public libraries are particularly important because they provide access to ICT resources to many in the community who do not have computers and broadband connections, as well as assistance with the use of online technology.

The process of digital inclusion is an important social leveller and is a pre-condition to the acceptance of the digital economy across the wider community. The use of public libraries as the focus for the Australian Government’s Digital Communities initiatives is appropriate and should provide a useful boost to the activities of the public libraries in Townsville.


Sustainability

Strategic Initiative 15 – Cabling of New Premises

Townsville City Council to work with industry to educate and encourage developers and builders to provide new buildings with best practice cabling (including minimum Cat 6 structured cabling from a wiring hub to all points according to current design standards).

Strategic Initiative 16 – New Defence Housing

The Defence Department should be encouraged to ensure that the design and internal cabling of new defence buildings complies with current best practice (including minimum Cat 6 structured cabling from a wiring hub to all points according to current design standards and serving multiple applications such as power management and water management).

Strategic Initiative 17 – Demonstration Smart House

Develop or modify an existing demonstration Sustainable Smart House in conjunction with local builders and suppliers to show how a smart house can work with the NBN, showcasing applications like eHealth, smart grids, high-bandwidth entertainment, sustainable living and teleworking.

Achieving greater sustainability in new buildings will require the adoption of best practice technologies and building standards. Many sustainability solutions will use digital technology to access information about internal and external environmental conditions, and to control devices inside and outside the premises. The NBN will facilitate the connectivity required to monitor and control devices such as air conditioners, shade control, ventilation, water heaters and switchboards.

As we move towards the use of more embedded sensors in electrical appliances the need to interconnect these devices will become important. Given the difficulty of retrofitting wiring to premises, it makes sense to include upgraded cabling systems in all new business and residential premises. Townsville can take a leading role in educating and encouraging builders and home owners in the use of leading edge sustainable and smart technology.

Newly developed Defence housing at Lavarack Barracks (Single Leap) is now an NBN Greenfield site and a pilot for 13 other defence bases around Australia. The internal cabling and technology facilities of these properties have been engineered to be NBN ready.

The best way to encourage sustainable building practices is to demonstrate the benefits through a real facility that allows hands-on operation of the different systems that contribute to sustainability.


Regional Initiatives

Strategic Initiative 18 – Collaboration between Regions

Encourage collaboration between Townsville and other centres across North Queensland using the work of JCU and National ICT Australia Ltd (NICTA), under the guidance of Broadband for the Tropics.

Strategic Initiative 19 – Intelligent Community Forum

Townsville to progress with an application in 2013 to be an Intelligent Community, with the aim of securing a place in the Smart21 (Applications close September 2013). The application would be a valuable benchmarking exercise for the city.

Studies have found that regional businesses had far less contact with other businesses when compared to large city businesses13, and they conclude that this is because there are fewer businesses in the local area. The NBN and digital economy can help by allowing better contact between businesses for the purposes of:

o (Online) collaboration on joint projects

o Improving supplier-customer relationships

o Improving access to expertise from the tertiary and research sector

o Improving access to government services and expertise at all levels

o Establishment of branch offices.

JCU is working with NICTA Queensland Research Laboratory to develop techniques and methodologies for collaboration between firms (B-to-B collaboration).

There are a number of awards available for cities and regions that meet criteria on the intelligent use of technology and the development of the intellectual currency of their people and businesses.

Success in these awards programs will promote the city and act as a focus in implementing programs and attracting resources. There is significant benefit in applying for these awards because it forces a self-examination that can highlight areas of strength and weakness, as well as opportunities for improvement.

The Intelligent Communities Forum (ICF) award includes the Smart21 as the first step in the process and the Top7 as the penultimate step before selection as Intelligent Community of the Year. Ipswich received a special mention in 2011 as an Intelligent Community, based on their work to attract the NBN and develop

13 Charlot S & Duranton G (2006). Cities and workplace communication: some quantitive evidence, Urban Studies, Vol 43, No. 8, pp. 1369-1394.


a health ICT sector. The ICF adopts a different theme for each year but some of the key indicators are:

o Broadband household penetration rate – policies and programs to increase penetration and use

o Knowledge workforce educational attainment of citizens – student-to-PC ratio in schools and availability of higher education

o Innovation policies encouraging business start-ups – business incubation, interactivity on the municipal web site, and availability of seed capital, grants and loans

o Digital inclusion and Internet availability – public-access computers, digital literacy training for adults

o Marketing and advocacy – an economic development strategy based on information and communications technology, including a task force or group devoted to carrying out the strategy

o Application for an award under the Smart21 or Top7 categories requires a long-term strategy starting well before the application is due.


imPlEmEnTaTion anD govErnanCE


imPlEmEnTaTion anD govErnanCE

The implementation of any strategy requires a sustained commitment and leaders to drive actions. A number of people and groups have been identified as key stakeholders in the development of the digital economy in Townsville and the broader region.

The model recommended for implementation is:

1. Townsville City Council supports a Townsville Digital Economy Strategy Implementation Group with membership drawn from the major stakeholders. Membership to include TCC, RDAT&NWQ, DSDIP, DSITIA, TEL, and JCU. The Implementation Group will need to consider the inclusion of industry specific groups such as Health and ICT. The Implementation Group’s terms of reference (Appendix 4) will include the wider North Queensland region and collaboration with Far North Queensland through the Broadband for the Tropics.

2. The Townsville City Digital Economy Strategy is a living document and will require industry leaders to take responsibility for tactical implementation within their field of influence and resourcing the collaborative development of relevant strategic initiatives.

The Broadband for the Tropics Committee, in pursuing their aims, includes encouraging widespread business and community support through facilitating initiatives that support the Townsville City Digital Economy Strategy.


ConClUSion


ConClUSion

Townsville, like most Australian cities, faces its share of challenges in the foreseeable future. However, as one of Australia’s first and second release sites for the NBN, Townsville has the opportunity to capture a first-mover advantage and strategically progress in the digital economy.

The digital economy is an extension of traditional local economic activities (including construction, mining services, manufacturing, defence and tourism) using high-speed broadband applications over the National Broadband Network (NBN) and the latest ICT hardware to advance the prosperity and well-being of the citizens of the Townsville region.

The digital economy does not just present opportunities – there are potential threats as well. There is a need for some urgency so that Townsville and the rest of Australia can profit from the digital economy rather than suffer the loss of business to our international competitors, many of whom are well ahead of Australia in providing access to high-speed broadband.

The transition from the traditional economy to the digital economy is unlikely to be an easy process. The provision of infrastructure such as the NBN is relatively straightforward, even if expensive. The re-skilling of the workforce and community, the change in business models, the development of new software applications and the change in government service models and infrastructure required, however, are more difficult to implement.

The advantage for Townsville is that the economy is strong and the community is capable. Townsville can lead the State in embracing the digital economy.


aPPEnDiCES


aPPEnDiX 1 – abbrEviaTionS

The following abbreviations have been used throughout this document:

AARNET – Australian Academic Research Network

CEDIA – Custom Electronics Design and Installation Association

DBCDE – Australian Department of Broadband, Communications and the Digital Economy

DEEDI – former Department of Employment, Economic Development and Innovation

DSDIP – Department of State Development, Infrastructure and Planning

DSITIA – Department of Science, Information Technology, Innovation and the Arts

HHRC – Health and Hospital Reform Commission

IBES – Institute for a Broadband-Enabled Society

JCU – James Cook University

QH – Queensland Health

RDA – Regional Development Australia Townsville and North West Queensland

TAFE – Queensland Tertiary and Further Education

TCC – Townsville City Council

TEL – Townsville Enterprise Limited


aPPEnDiX 2 – iCT TrEnDS

The Growth of the Internet and World Wide Web

Internet traffic has grown rapidly since the Internet and World Wide Web were first developed in 1969 and 1989 respectively. The types of traffic have varied widely over that period reflecting the changes in technology and usage.

Web browsing traffic has been reducing since its peak, as video and other traffic associated with particular applications, has grown.

The Internet is the network of devices (or more correctly the network of networks) connected using the Internet working Protocol Suite (TCP/IP) originally invented by researchers looking for a super resilient network which mimicked the natural world in its ability to self-heal and re-configure. The World Wide Web (e.g. http://www.xxx) was invented by Tim Berners-Lee and can be thought of as an overlay to the Internet. It consists of the documents, images and resources located on the Internet, which are referenced using Hyperlinks from a browser application.


Figure 0-2 - The growth of different types of traffic (Source: Chris Anderson and Michael Wolff)

Internet Timeline

1969 – First two Internet connections as DARPAnet (US Defence)

1989 – Origins of the worldwide web – www (Tim Berners-Lee)*

1995 – Larry Page & Sergey Brin met at Stamford (founders of Google)

1996–98 – Internet interest from business and government

1999 – Y2k

1999 – Dotcom boom

2000 – Microsoft Windows released

2001 – Dotcom bust

2001 – Apple iPod, Xbox and Windows XP released

2001 – Napster reaches 25 million users

2002 – 1 billion PCs shipped since mid-1970s, Web 2.0 emerges

2003 – Intel Pentium released, My Space & Mozilla founded

2004 – Google announces Gmail

2005 – YouTube founded

2006 – Intel Core 2 processors, MS Windows Vista and Blu-ray Disk released


2006 – Skype announces 100 million users

2007 – Apple announces iPhone, Amazon announces (?) Kindle reader, Google announces Android

2008 – Apple iMac released

2009 – MS Windows 7 released

2010 – Apple iPad released

2011 – Apple announces iCloud

The Cloud

The architecture of IT networks is changing–as it has done many times in the past–towards a more centralised processing and storage model, based on large data centres which provide processing capacity, storage, and software (the Cloud). The increased efficiency of the large-scale deployment and operation of data centres promises to be an environmental and economic benefit.

Large data centres provide investment and construction activity into the region. However the major benefit of large data centres is the potential for them to support the economic development resulting from higher order ICT business services such as:

o Managed services – the provision of services of various types to businesses by an ICT supplier.

o Software development and management services

o Infrastructure-as-a-Service (IaaS) – the provision of infrastructure such as servers and storage devices which can be managed and configured by the business user – typically an ICT company who uses the devices to offer higher-level services to other users.

o Platform-as-a-Service (PaaS) – the provision of infrastructure with basic operating system software, maintenance and configuration.

o Software-as-a-Service (SaaS) – the provision of infrastructure with applications software, licensing and support.

o Service-as-a-Service – the provision of a complete end-to-end service for business applications such as billing, customer relationship management and accounting.


BYO Computing

As a new generation of highly IT-literate workers start to reach more senior positions in the workplace the demand for a more flexible corporate computing operating environment is increasing. These ‘digital natives’, who have grown-up with information technology and take it for granted, are starting to expect:

o Access to social networking from work.

o The ability to connect their personal smart phones to the corporate network.

o The ability to connect their own computing devices to the corporate network.

While this presents very serious challenges to corporate IT managers, it may also deliver benefits. The trend is arguably unstoppable in the long term so solutions to security issues must be developed, potentially based on a cloud computing model.

Open Source

Open source software, in which the source code is made available free of charge to all interested parties, is a cornerstone of the digital economy. It includes a major operating system (Linux), the dominant web server software (Apache), and thousands of other software programs.

The advantage of open source software to businesses is that it is available for low or no cost and offers a wide range of business applications, with online support community.

Web 2.0 and 3.0

Web 1.0 was the first incarnation of the web that allowed the downloading of information. Web 2.0 is more interactive and allows users to upload their own content (user-generated content). Currently a large proportion of web traffic is user-generated content, much generated on social media sites and applications. Consumers or users in this context are sometimes called prosumers because they produce and consume media.

Web 3.0 is the next generation, providing context-sensitive content, which is aware of who you are, where you are, your proximity to people you know, and your interests.

These technologies and Web 3.0 in particular, provide opportunities to suppliers and consumers of these value-added services as marketing and sales tools.


Access to Government Information–Government 2.0

The Australian Government has a program14 to provide more open access to information held by governments of all levels. One of the key principles of the Government 2.0 program is that the open access to government data will open-up new opportunities for businesses to analyse, process, package and sell that data as a product or service.

For example, access to mapping and statistical information, may allow firms to provide value-added reports combining GIS and statistical data.

Copyright issues are being addressed through the use of the Creative Commons licence. (The Creative Commons is an international non-profit organisation that provides free licenses and tools that copyright owners can use to allow others to share, reuse and remix their material, legally).

The Internet of Things

The Internet has traditionally connected people to information or to other people, via their computers, with relatively few connections that did not involve at least one person. However this situation is starting to change. The pervasiveness of broadband connections, aided by mobile broadband, and the rapidly falling cost and portability of sensor devices, is leading to the Internet of Things – rather than the Internet of Brains.

Sensors are now able to measure environmental conditions, conditions within buildings, the state of structures such as buildings and bridges, the positions of devices (and their owners). This information is especially valuable if it can be collected and analysed. The NBN will allow collection of the data, while modern computers and specialised software will provide the analysis tools.

The economic benefit comes from the organisations and institutes that provide the service of analysing the data and reaching conclusions that are of value. The economic value chain shown below in Figure 5-3, demonstrates the increasing value of the data gathered as it is processed analysed and applied to innovate and solve problems.

Figure 5-3 - The Information Value Chain

Data Information Knowledge Wisdom Action

14 Towards an Australian Government Information Policy, Australian Government,November 2010


The corresponding value chain elements are shown in Figure 5-4 below. The physical elements include the sensors that measure the raw data, the networks that collect the data and transfer it to a defined point and the computers that start the processing and analysis. The analysis and study part of the process extracts the wisdom that can be drawn from the data so that action can be taken as human intervention or machine controls.

Many of the opportunities flowing from the digital economy will be within the information value chain, including physical and technical jobs in the first three elements of the process. Knowledge works in the later elements. Traditionally, regional areas would not benefit from most of these developments because they are more likely to be focussed in capital cities. The lead role that Townsville has in the NBN is an opportunity to increase the benefit to North Queensland from new information value chain opportunities.

Figure 5-4 – Elements and Steps of the Value Chain

Sensor Networks

Networks

Computers

Analysis and Study

Actuators

The Importance of Applications (Apps)

One of the major changes in the ICT sector is the increasing importance of applications (apps) for portable devices. Apart from the dramatic change to the revenue model for developers and distributors achieved by iTunes, the rise of apps to simplify processes and provide branding opportunities has been dramatic.

The new revenue model for apps means that developers can introduce small apps for a relatively low cost, sell them through the iTunes-like model, and make significant profits if successful in generating large numbers of sales. Several Queensland companies such as Half Brick have been very successful with their apps development (eg Fruit Ninja).

The new apps such as those developed by the major banks, simplify the application by removing the need to use a browser to log-on and navigate. Apps can provide a much richer user experience with one touch functionality.


As an additional benefit, the developer’s brand is locked onto the desktop of one or more devices to reinforce brand allegiances. A local app development industry is a very important component in building local knowledge-based skills and industries and this should be encouraged through government sponsorship.

Data Analytics

Data analytics (or Big Data as it is sometimes called) provides useful intelligence by analysing data from a wide variety of sources including: mobile smart phone locations, web searches, photo activity, credit card transactions and other historical information. Although the information is normally gathered in an aggregated form to protect privacy, the intelligence gathered can be very useful.


aPPEnDiX 3 – PiloT ProjECTS

One way to facilitate the implementation of an economic development strategy is to identify a small number of pilot projects that can be implemented in a limited way. This process can help to identify the opportunities, demonstrate the potential, enlist support from a wider group within the community and identify any difficulties or blockers that would limit a wider adoption.

A number of potential digital economy pilot projects have been identified in Townsville. These projects should be considered for early implementation and widespread support. Some of these projects are already underway and consideration should be given to increasing their scope if possible to include digital economy applications.

Existing Projects

There are a number of existing projects underway or in concept stage in Townsville that will help to demonstrate the potential of the digital economy.

Tropical Sustainability Hub (JCU)

Townsville researchers at James Cook University are developing systems to predict future habitat suitability based on historical records and predictions of climate change. The collaboration that is enabled by the NBN will allow this research to continue across multiple campuses. These studies rely on the collection of data using high-speed broadband.

Virtual learning environments

Virtual learning environments are already in use by two schools in Townsville, using the NBN (in the case of one) and best available broadband.

The virtual learning environments use broadband and virtual (remote) classrooms to teach classes by combining physically separate classrooms – sometimes on other sides of the world. The lower broadband speeds are a limiting factor in many cases but the latter school is ready to progress as soon as the NBN is available.

Homestead of the Future (CSIRO)

CSIRO is engaging with the rural community to establish a centre at the Lansdown Research Centre at Woodstock, south of Townsville. The centre aims


to research and demonstrate the ways in which ICT can improve the operations of a rural property through applications such as:

o Tracking stock movements.

o Controlling stock movements.

o Monitoring crop yields.

o Monitoring water and power usage.

o Monitoring pasture conditions and management.

o Improving communications with suppliers and markets through data and video conferencing.

o Developing new commercial operations such as tourism.

The centre will also focus on improving health outcomes through the use of:

o Voice monitoring.

o Health sensors.

o Facial recognition.

o Improved social interaction.

o Access to health services.

There is potential to develop this centre to demonstrate how the modern rural property can use the digital economy to improve business, environmental and personal outcomes.

Possible New Projects

City Sustainability Hub (IBM)

The City Sustainability Hub, as proposed by IBM as part of the IBM Smarter Cities Challenge, is a platform that aggregates expertise, services and products to help communities connect, learn, organise and collaborate to improve sustainability in energy, water and waste.

The education and information from private and public sources, provided by the hub, is critical in helping to change individual and group behaviour.

The hub would also provide insight and data to the local business community and entrepreneurs as they look for opportunities to provide new products and services.


Defence Smart Homes/Discovery Rise

The building activity that is about to occur at Discovery Rise and Lavarack Barracks has presented a good opportunity to lift the standard of smart home infrastructure in a large number of Townsville buildings in a short period of time.

The cabling standard of the buildings should be specified to cover all of the basic requirements for: home automation, lighting control, energy management, entertainment, data and security. The technology systems do not need to be fully populated and activated in all buildings, provided the building and cabling design is compatible and the cabling and pathways are complete.

The system architecture, acoustics, cable pathway and cabling should be designed by a qualified person such as a CEDIA (Custom Electronics Design and Installation Association) accredited specialist designer. An ACMA (Australian Communications Management Authority) accredited data communications cabler should install the cabling.

At least one building in each area should be identified as a demonstration house, to showcase the benefits of the NBN and intelligent house design. The involvement of James Cook University (JCU) and Barrier Reef TAFE may be beneficial in providing training opportunities.

Integrated Building Industry

Building Industry Online is a Townsville based company that offers an integrated building industry solution from online access. The building and construction industry uses a large number of complex contracts and drawings that need to be accessed and modified by various designers, planners and sub-contractors. This leads to issues with data currency – ensuring that everyone is operating from the same version of the documentation. The simplest way to achieve this outcome is to use one set of documents, held centrally, and to give all parties online access to the central record. This is possible only when there is ubiquitous high-speed broadband. Townsville is an ideal location to pilot this service using the NBN.

The service could also be extended to TCC to allow online submission of planning approvals documentation and development assessments. The removal of most of the paper records in this process would save time and money for the building industry and council.

Creative Industries

The creative industries sector is widely regarded as one of the most significant contributors to both developed and developing economies worldwide. The creative industries sector is diverse in terms of participants and forms of activity, ranging from traditional cultural production (e.g. visual arts, music) through to commercially oriented service industries (e.g. architecture, TV/radio). What


binds these various forms of practice or activity is the concept of creativity, this is also recognised as a key requirement for innovation and growth of regions, cities and economies.

A symposium on Townsville’s Creative Industries was held in March 2013 by approximately 100 participants, each of whom has a keen interest in the growth of Townsville, including representatives from Townsville City Council, the arts community, creative business sector, arts education and academia. There is a strong sense of commitment to the past, current and future creative industries in Townsville – the Townsville City Economic Development Plan 2013-2017 includes references to this opportunity.


aPPEnDiX 4 – agrEED TErmS of rEfErEnCE – imPlEmEnTaTion CommiTTEE

Background

The “Townsville City Digital Economy Strategy” (TCDES) is the key to enabling a framework that continues to develop and position Townsville as Northern Australia’s leading city through increased digital economic and community outcomes.

The “Broadband for the Tropics” (BftT) Committee was formed to encourage widespread business and community digital awareness and participation in the Digital Economy (DE). As one of its’ developing functions, BftT can encourage and play a role in the coordinated adoption of the TCDES initiatives to support and facilitate associated DE activities. The TCDES is a guide and living document and its’ success will be based on the implementation of the strategic initiatives contained therein.

The TCDES has been developed with input from many community and business groups, providing shared objectives and strategic outcomes. A unified approach is required to achieve these objectives and outcomes.

Critical to the success of the TCDES is developing and actioning an ‘Implementation Schedule’ to represent the key priorities considered to have potential to make a significant contribution towards achieving DE participation and growth as outlined by the TCDES.

While it is noted that the overall responsibility (or custodianship) for the TCDES lies with the Townsville City Council, many objectives fall within the responsibility of other agencies. Objectives will require, or benefit from, a multi-agency approach under the strategic direction of BftT.

The TCDES recognises the establishment of an implementation group to oversee and monitor the Strategy. Following endorsement by the BftT Committee, a meeting of the joint partners listed in the TCDES will be convened for the purpose of confirming the draft ‘Terms of Reference’ (ToR) for use by this group. The ToR will include criteria for membership (composition and numbers), define what (if any) resources are required and make budget recommendations


accordingly, including other matters such as frequency of committee meetings and the reporting framework.

Purpose of Implementation Committee

To coordinate the implementation of the activities outlined in the TCDES and to report to the BftT Committee on a regular basis (see below). Members will promote and encourage discussion and debate the TCDES strategic initiatives and activities throughout their respective organisations and the community at large.

Authority

The authority of the Implementation Committee is to be confined to coordination and advisory functions representing agencies with key DE development responsibilities. The Implementation Committee will however encourage collaboration between all agencies involved in the implementation of the TCDES, especially in conveying the actions to the community.

Committee Membership

The Implementation Committee membership is defined broadly in the TCDES to include agencies involved in the implementation of the activities associated with the strategic initiatives. In this regard the Implementation Committee will be informed by the following criteria:

o 7 core members made up from: Townsville City Council, Queensland Department of Science, Information Technology, Innovation and the Arts, Queensland Department of State Development, Infrastructure and Planning, James Cook University, Regional Development Australia Townsville and North West Queensland, Townsville Chamber of Commerce and Townsville Enterprise Ltd.

o The number of members present for a quorum will be four members in attendance: ‘attendance’ will be taken to include both physical and telephone attendance.

o The Townsville City Council member shall Chair meetings of the committee and if this person is not available the members shall appoint a chair at the relevant meeting.

o The Townsville City Council shall provide secretariat/administrative functions that will include agenda, minutes, correspondence and/or general enquiries relevant to the committee’s operations.


o Membership of the committee will remain in place for the duration and purpose of implementing actions of the TCDES unless a vacancy occurs whereby the committee will seek to fill this vacancy.

o The membership of the committee is open to expansion subject to other organisations with due consideration and approval by the committee.

o Frequency of meetings shall be at a minimum quarterly for the purpose of monitoring and reviewing progress of the Implementation Schedule as well as actioning priorities.

Annual Reporting

The committee will oversee a biannual report to the BftT Committee and the Townsville City Economic Development Plan Management Group and provide an annual written report/update regarding progress of the “Townsville City Digital Economy Strategy”.

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