Broadband Briefing: Is the NBN the best way to increase broadband access to schools

One of the many justifications cited for the national broadband network (NBN) is to connect schools around the country to fibre optic cable.

For example, the publicity material issued by NBN Co tells us about Circular Head Christian School in Tasmania which is now connected to fibre.

But when you look into it a bit more deeply, it turns out that connecting schools to high speed broadband is not a good justification for the NBN.

To start with, over 60 per cent of schools in Australia are already connected to a fibre optic network.

That’s according to a survey conducted by the federal Education Department in 2010.  What’s more, the percentage has jumped from 47 per cent a year ago.

This survey reveals something else interesting. Only five per cent of schools have a connection which is more than 20 megabits per second.

Why is it that so many schools are taking a far lower speed than the 100 megabits per second (or even higher) which would be possible over their fibre connection?

The answer: it is too expensive for them to take a higher speed.  As a 2008 paper from the same Department notes, affordability is the major barrier to take up, and volume based charging of internet usage is a particular problem for schools.

The implication: if our policy objective is getting high speed broadband to as many Australian schools as possible, the current NBN policy is not the best way to meet that objective.

The first reason is the cost, scale and complexity inherent in the NBN: a $56 billion project to build direct connections to ten million premises around Australia.

Consider an alternative strategy of rapidly connecting all schools to fibre (or, more likely, all but the relative handful of schools which are so remote that they are in a community which is itself not connected to fibre.)

There are around 10,000 schools in Australia, and hence around 4,000 schools still not connected to fibre. By targeting the 4,000, you could get them connected much more quickly than if you deal with them as one part of a much larger overall program.

But the second, more compelling, reason is cost.  If cost is the real barrier to schools’ use of high bandwidth services today, will the NBN change it?  There is no reason to think so.

Indeed, NBN Co proposes a pricing model which increases the cost to the end user as data usage grows: the very problem which the Education Department’s 2008 paper correctly identifies as the real barrier to broadband take up in schools.

NBN will do nothing to solve that problem; instead it may well make it worse, because the NBN will dominate the future telecommunications market to an even greater extent than Telstra does today.

A better policy approach would be to target public spending to the minority of schools which do not yet have fibre (consistent with the approach proposed in the Coalition’s 2010 broadband policy); and focus on increasing competition in the telecommunications market so that it becomes more affordable for schools to buy the bandwidth they need.

That is pretty much the opposite of Labor’s NBN strategy – meaning unfortunately that the future for broadband to schools is not as bright as it should be.