TECHNOLOGY SPECTATOR: NBN's boardroom broadband revolution

Technology Spectator

The NBN is going to be one of the largest predictable market disturbances in recent history for Australian businesses – one which, like other disruptive forces of such magnitude, favours new entrants while forcing incumbents into rapid evolutionary change. The difference between success and failure in the post-NBN world will depend on how businesses harness the potential of the NBN and that's why NBN readiness needs to become a conversation point at the executive level.

Unlike a year ago, the development of a fast national broadband network is no longer politically dependent; moreover, its rollout will impact most multi-site businesses within a year. By June 2015-2016, NBN Co expects a third of Australian homes to have NBN access. Macquarie Telecom expects this rate of coverage will be dramatically higher for businesses at around 60 per cent.

The NBN will not supplement but replace existing broadband infrastructure around Australia. This change will come a lot faster than most businesses might expect and will require some radical shifts in investment and policy for all organisations, particularly smaller or regional businesses.

Starting the NBN conversation

NBN readiness involves making sure all aspects of business are planned with the NBN in mind: not just IT systems, but also business processes, employee skills, and product or service innovation. Given the fundamental changes heralded by the NBN this conversation needs to be taking place in boardrooms across Australia right now.

NBN implementation has the potential to help – or hinder – all departments and functions of a business and as Alcatel-Lucent's recent Smart.Digital.Connected report points out, 80 per cent of executives say digital economy participation needs executive and board focus for strategic planning. Gaining the best possible outcomes from the NBN requires a holistic approach to its use, rather than fragmented and inconsistent policies between different parts of the organisation. Since all businesses and their customers will have to transition over to NBN sooner or later, making it a topic of C-level discussion is necessary to avoid being caught out by the rapid speed of the rollout or advances made by competitors.

Once the NBN becomes a key topic for executive discussion, businesses can take action in three main areas of potential benefit. Firstly, they can use the NBN to drive internal efficiencies, making people and supply chains more productive. Second, they can boost revenue streams by using the NBN to access new markets and market segments. Finally, they can reposition their corporate strategies to manage new assets and risks resulting from the increasingly digital business landscape. The C-suite is in a unique position to push through these critical actions for their organisations.

The businesses which benefit most from the NBN's affordances will be those which can act first and as a decisive whole. To do this, businesses need to consider which service providers can offer the best counsel and capabilities to take advantage of the NBN, rather than blindly remaining with incumbent providers based on their perceived stability. Immediate boardroom discussion is the only way to enable this sort of rapid, concerted action.

Improving NBN readiness

So how does a business improve its NBN readiness? Lingering concerns about cost and reliability must be addressed first and foremost. NBN prices are now no greater than those for DSL connections, particularly when factoring in line rental costs for the latter. Enhanced service-level agreements from NBN Co have already been announced, guaranteeing rapid response and restoration times at a relatively low monthly cost for businesses. Business-centric NBN products will continue to be rolled out over the next few years, further amplifying the gap between those with NBN-ready processes and those without.

Small and large businesses alike should focus on removing impediments which might limit their ability to keep up with these ongoing improvements. Contracts with IT providers should allow for technology refreshes when NBN updates occur, while technology deployments should be forward-compatible to leverage enhanced speeds with minimal upgrade costs.

Macquarie Telecom conducts annual technology refreshers to provide multisite clients with progressive access once the NBN reaches their various areas; businesses should consult NBN Co's rollout schedule or Macquarie Telecom's NBN Business Ready online portal to determine a more accurate timeline for their readiness strategies. As mentioned earlier, executive-level discussion is critical in ensuring that limitations in one business area don't hinder the organisation's broader use of NBN.

Freedom and equality

Smaller businesses and those with a regional presence look set to be the biggest winners from the NBN. Moreover, the assumption that many big companies and government agencies already have access to network infrastructure comparable to what the NBN will offer needs to be challenged.

The truth is that most of this infrastructure is currently limited to CBDs, which begs the question: what about branch offices and regional operations? A business' application deployment is only as good as their slowest connection, and high-speed CBD access alone isn't enough to ensure market-wide benefits – particularly when using the NBN to access new markets or geographies. Organisations need to think of how the NBN can literally bring their broader operations up to speed, rather than adhering to a CBD-centric view of connectivity.

Nor are gains restricted to dotcom industries: according to a 2010 Access Economics, report commissioned by Macquarie Telecom, sectors like food and beverage, commercial construction and personal services can expect some of the largest benefits from high-speed broadband. That same survey found more than 70 per cent of businesses expect the NBN to allow faster product delivery to market, while almost 80 per cent believe it will offer greater diversity and depth of offerings. These benefits, however, require significant adaptation on the part of businesses themselves.

Smaller organisations may be able to adapt faster to the NBN, but they may feel less inclination to do so. However, organisations which persist with a "business-as-usual” approach will find themselves at significant disadvantage when the NBN itself becomes the new "business-as-usual”. Those who don't adapt now will end up falling behind in market penetration, productivity, and profits. When all businesses and their customers operate from the same high-speed network, physical assets cease to be a limit on what the organisation can accomplish. That's a disruptive shift which requires significant changes to organisational technology and culture: focusing on boosting productivity, growing new-market revenues, and developing digital-ready business models.

The pace and comprehensiveness of those changes will ultimately determine the winners and losers from the NBN's deployment: a combination of clear leadership and attention to technical detail offers businesses the best chance of drawing a winning hand.

Christopher Greig is the group executive for the telecom business of Macquarie Telecom.