Australian farmers could remain years behind global peers due to NBN delays

Adam Tomlinson, Australian Farm Institute

Wouldn’t it be great if everyone had access to a seamless flow of information via the internet. Whether you worked in a metropolitan area or a remote farming region, the software or data needed to keep your business running efficiently could be downloaded quickly and affordably. Although this scenario already exists in some parts of the world, it remains wishful thinking for most Australian farmers. In reality, farmers are frequently forced to use their ingenuity to find their closest internet hot spot, whether it is in a particular position at the far end of the farm or in a distant town.

The key to establishing quick and affordable internet access across the country is the installation of a comprehensive broadband network. Broadband is defined as high-speed internet access that is always on and with a faster data transfer speed than traditional dial-up technology (FCC 2015).

Broadband access allows a farmer to evaluate the precise performance of their farm business’s watering systems, weather stations, field equipment, crops, livestock and employees remotely via the internet. The vast scale of the Australian continent and sparse distribution of communities outside of major urban centres, however, has created substantial challenges for implementing a broadband network capable of servicing the majority of Australian farm businesses.

Successive Australian Governments have found planning and implementing a national broadband strategy extremely challenging due to the ever-changing nature of technology and the large-scale infrastructure spending commitments that go with it. Ultimately, these types of challenges have led to political battles and protracted delays in providing high quality broadband access to all Australians. Consequently, Australian farmers have been left trailing behind their peers in countries that have higher quality broadband access.

The Australian Government’s current broadband policy involves rolling out the latest technology via a National Broadband Network (NBN) which will deliver high-speed broadband access to all Australians by the end of 2019 (Department of Communications 2015). Upon completion, the NBN will provide at least 50 megabits per second (Mbps) download rates to 90% of fixed premises and 12 Mbps download rates to those accessing broadband through satellite services.

It is likely that many Australian farm businesses will access broadband (particularly in the field) through satellite services. However, the 12 Mbps download rates offered by satellite services might not be sufficient for Australian farmers as they are already competing with farmers in other nations who enjoy much faster internet access. Essentially, this means that Australian farmers could be at risk of remaining years behind global peers in adopting the most advanced internet-enabled technologies, and utilising the ever-increasing volume of data that is becoming available to assist the operators of farm businesses.

Why broadband access and speed matters

There are various types of broadband-enabled technologies that have the potential to offer unprecedented capital and labour efficiency gains for farm businesses (see Box 1). These technologies generally involve infrastructure for data collection, management, analysis and advice that depend on capable and affordable broadband coverage.

Box 1:  As an example of the benefits broadband-enabled technology can bring, consider the example of a large-scale cattle producing operation in western Queensland. The business normally runs around 10,000 cattle, watered via a network of some 30 bores and associated water tanks and troughs. During the peak of summer, cattle cannot survive even 24 hours without water, so the main job on the property in the past has been a daily 300 kilometre bore run, to check all bores and troughs are fully operational. Installation of a network of electronic bore monitors, all connected via the internet to a mobile phone application that immediately alerts the owner when a change of water flow occurs, has meant the owner no longer needs to spend up to eight hours every day just checking bores and troughs. However, a lack of reliable internet access has meant the technology can only be made workable with the installation of an expensive VHF radio network. Further augmentation of the system via the installation of CCTV monitors could deliver even greater efficiencies by enabling remotely-controlled gates to be used to hold cattle at the water, greatly reducing the time and cost associated with mustering. This technology requires fast and reliable broadband internet access to operate effectively, so is not currently feasible without large capital setup costs in most rural areas. 
There are information and communication technology (ICT) companies that write software and build wireless systems for farmers and land managers to monitor and control infrastructure such as electric fences, water pumps, irrigation channels, centre pivot irrigators; as well as to collect data from soil moisture sensors, weather stations and cameras (Mulcaster 2014). The infrastructure developed by these types of ICT companies largely depends on broadband coverage. Broadband-enabled technologies offered by multinational machinery makers provide another example of where inadequate broadband coverage can limit technology use. Many machinery companies now offer a wide range of in-built precision agricultural technologies that involve collecting data which helps monitor the real-time performance of a machine, field or crop. However to fully utilise this type of technology, a mobile data connection is required to transfer information from the machine to a website (John Deere 2015). As a consequence, available internet speed is becoming an important criteria for farmers in making machinery purchasing decisions, in cases where those machines involve broadband-enabled technologies. If internet speeds are too slow then most data applications are simply an expensive and useless option. As a general rule, internet connections with data transfer speeds of less than 1.5 Mbps are not able to transmit relatively small yield monitor data files (Griffin et al. 2015).

Australian broadband methods, coverage and adoption

Australian residents and businesses access the internet through a variety of means including the traditional dial-up via a fixed telephone line and broadband systems such as fibre, cable, digital subscriber line (DSL), wireless or satellite (see Figure 1). Mobile wireless and DSL methods are currently the two major types of broadband access available in Australia.

Figure 1:  Internet subscribers by type of access connection in Australia.
Source:  AFI analysis from ABS catalogue no. 8153.0 – Internet Activity, Australia, December 2014, <http://www.abs.gov.au/AUSSTATS/abs@.nsf/allprimarymainfeatures/00FD2E732C939C06CA257E19000FB410?opendocument>.

Figure 2:  Population distribution in Australia by regional type.
Source:  AFI analysis from the Regional Australia Institute (2014) database, accessed 20 March 2015, <http://insight.regionalaustralia.org.au/>.

The Regional Australia Institute (RAI) has analysed the quality of broadband coverage for 564 local government areas (LGAs) across Australia. RAI analysis shows that less than 13% of the Australian population lives in regions that are considered rural or remote (see Figure 2). Based on the most recent RAI quality ratings for broadband coverage, the heartlands region, where the majority of Australian farm businesses are located, has the lowest quality broadband access on average and the largest variance in broadband quality across Australia (see Figure 3).

Figure 3:  Quality ratings for broadband coverage in different regions across Australia.
Source:  AFI analysis from the Regional Australia Institute (2014) database, accessed 20 March 2015, <http://insight.regionalaustralia.org.au/>.

Nearly all businesses in Australia access the internet using a broadband connection (see Table 1). However, businesses in the agriculture, forestry and fishing industry lag behind other industries when it comes to accessing broadband, building a web presence, placing orders via the internet and receiving orders via the internet. There is no doubt that the relatively low quality of broadband coverage in rural and remote regions is a major reason for the slow adoption of internet functions by these businesses.

Table 1:  Australian business use of information technology.

Industry by employment size (2011/12)
 
Businesses with:
Businesses with internet access that have:
Businesses that:
Internet access Web presence Dial-up or ISDN* as main type of internet connection Broadband as main type of internet connection Placed orders via the internet Received orders via the internet
% % % % % %
Agriculture, Forestry and Fishing
0–4 persons 83.3 5.1 1.5 98.5 25 6.5
5–19 persons 85.5 18.1 3 97 51.9 21.7
20–199 persons 85.6 24.5 0 100 68.1 5.9
200 or more persons 90.1 80.3 0 100 67 40.1
Total 84.2 10.8 1.9 98.1 36.9 11.5
Total all industries
0–4 persons 90.2 34.1 1 99 47.8 23.4
5–19 persons 93.7 57 0.5 99.5 65.2 34.3
20–199 persons 98.3 75.7 0.6 99.4 74.1 36.8
200 or more persons 99.9 97 0.2 99.8 81.3 40
Total 91.9 44.6 0.8 99.2 55.3 27.8

Source:  ABS catalogue no. 8129.0 – Business Use of Information Technology, 2011–12,  <http://www.abs.gov.au/AUSSTATS/abs@.nsf/second+level+view?ReadForm&prodno=8129.0&viewtitle=Business%20Use%20of%20Information%20Technology~2011-12~Latest~22/08/2013&&tabname=Past%20Future%20Issues&prodno=8129.0&issue=2011-12&num=&view=&>.

Australian government policy on broadband access

In 2004, the Australian Government recognised the need for a national broadband strategy, with the aim of achieving fair and reasonable access to broadband and its benefits for all Australians. Subsequently, major telecommunications providers, such as Telstra and Optus, put forward proposals for establishing broadband networks. These proposals were later rejected by the Australian Competition and Consumer Commission (ACCC) due to several key issues such as the proposals for recovering the actual costs incurred in providing the service (Department of Communications 2013).

It was not until 2009, that the Australian Government established the NBN Co for the purpose of funding the installation of national broadband infrastructure. The argument for the government to establish the NBN Co was based on the likelihood that private sector enterprises would not have otherwise considered broadband solutions feasible for all Australian citizens, particularly those in rural and remote areas.

The development of the NBN offers a unique opportunity for the Australian Government to be involved in helping people in rural and remote Australia to access e-health, distance education and entertainment on demand. The development of the NBN also offers support to businesses in these areas by potentially increasing productivity, reducing costs and accessing new markets.

Nevertheless, satisfying the majority of voters while fulfilling the commitment to improve internet services to every Australian citizen has been a major challenge for the Australian Government. According to World Bank statistics, Australia is one of the most urbanised nations and has the fourth lowest national population density at just three people per square kilometre of land area. This means that large public spending projects like the NBN, which involve significant spending in rural and remote areas, need to garner support from a majority of voters living in urban electorates. Inevitably, this generally leads to prioritising services in urban areas before delivering these services to the people living in rural and remote locations.

The initial development plan for the NBN relied on a fibre to the premises (FTTP) model, which involved nearly all Australians being able to access fibre optic technologies for internet services. Although this type of infrastructure is well suited to urban areas, it is relatively expensive in rural and remote Australia, where the cost and time required to install fibre-optic cables over long distances can be prohibitive. Hence, following a strategic review of the NBN in 2013, the present Australian Government decided to change from the FTTP model to one that diversifies and expedites (in relative terms) internet access through an optimised multi-technology mix.

According to NBN Co, this model involves selecting which broadband infrastructure will be rolled out on an area-by-area basis. Besides FTTP infrastructure, this model includes broadband access technology such as:

  • fibre to the node (FTTN) and fibre to the building/business/basement (FTTB)
  • hybrid fibre-coaxial (HFC) cable
  • fixed wireless footprints
  • satellite broadband.

For many parts of rural and remote Australia, broadband access will be based on the development of a long term satellite service administered by the NBN Co. Two new satellites are being launched which will make broadband services commercially available to some parts of rural and remote Australia by 2015/16. The NBN long term satellite service is also being supported by the development of 10 ground station sites.

The long term satellite service will enable NBN Co to offer wholesale services configured for a planned 12 Mbps download and 1 Mbps upload speed to premises outside the NBN fibre and fixed wireless footprints (NBN Co 2014).

Satellite broadband services in Australia can be limited by factors including the weather and an internet subscriber’s line of sight to the orbiting satellite. These issues can lead to intermittent internet access which slows down data and information sharing between devices and storage services. Ultimately, these issues can potentially lower the performance of broadband-enabled technologies which are based on real-time, uninterrupted data and information processing.

NBN Co satellite broadband services are also expected to have monthly download limits of 60 gigabytes per internet subscriber. This could potentially lead to farm businesses incurring penalties for exceeding monthly download limits or farmers signing up to multiple internet packages to ensure they have adequate internet capacity. Consequently, these issues could discourage farmers from adopting technology that could have otherwise enhanced productivity.

Broadband advantages and the current limitations for Australian farm businesses

Historically, farmers have used the internet primarily for tracking commodity prices, accessing weather forecasts and trading relatively low-value farm items. However, farmers who presently have sufficient broadband access are now able to transfer data between their equipment and machinery and cloud-based storage services, push cropping prescriptions to applicators and monitor real-time alert systems for immediate pest threats (Griffin et al. 2015). These types of new technologies, which involve collecting and processing farm data via the internet, are part of a broader digital phenomenon principally known as big data.

Although there are some Australian farmers who are lucky enough to be able to take full advantage of the productivity gains available through big data developments, there are many more that are not so lucky. In many cases, Australian farm businesses are currently operating with broadband connections that are slower and more costly than those available in other nations that compete for similar agricultural export market opportunities, such as Denmark, the United States (US) and Canada (see Table 2). As a result, there are many Australian farmers who could remain years behind global peers in technology adoption due to inadequate internet access.

Table 2:  Average internet connection speeds and utilisation rates for selected countries.

Country Global rank Average connection
speed (Mbps)
% above
4 Mbps 
% above
15 Mbps 
South Korea 1 22.2 95.0% 61.0%
Japan 3 15.2 88.0% 34.0%
Denmark 11 11.9 92.0% 21.0%
United States 16 11.1 74.0% 18.0%
United Kingdom 18 10.9 83.0% 22.0%
Canada 20 10.7 85.0% 16.0%
Russia 27 9 82.0% 11.0%
Germany 29 8.8 80.0% 9.4%
Australia 42 7.4 69.0% 6.5%
France 44 7.1 70.0% 5.0%
Thailand  45 7.1 86.0% 3.8%
China 82 3.4 27.0% 0.2%
Brazil 89 3 26.0% 0.1%
India  116 2 7.8% 0.4%
Source:  AFI analysis from Akamai (2014), Akamai’s State of the Internet: Q4 [2014 Report], vol. 7, no. 4, <http://www.stateoftheinternet.com/>, accessed 7 April 2015.   

As noted earlier in this article, farm businesses have the lowest quality broadband access (on average) in Australia. The low quality broadband coverage generally reflects slow internet speeds which are well below Australia’s average connection speed of 7.4 Mbps. Farmers typically rely on wireless broadband access from mobile phone networks to assist with transferring data from different parts of their farm. Based on Telstra’s latest data on mobile network coverage, a relatively large proportion of Australian farmers in the major grain growing regions have mobile broadband access with download speeds between 550 kilobits per second (Kbps) and 3 Mbps (see Figure 4).

Figure 4:  Telstra’s mobile network coverage across Australia.
Source:  AFI analysis from Telstra.com, <https://www.telstra.com.au/coverage-networks/our-coverage>, accessed 23 April 2015, and GRDC, <http://www.grdc.com.au/uploads/documents/grall.jpg>, accessed 23 April 2015, ABARES <http://apps.daff.gov.au/AGSURF/regions.html>, accessed 23 April 2015.

In comparison, much of the rural area in the US has access to faster internet, with a relatively large proportion of US grain growing regions having available broadband speeds above 25 Mbps (see Figure 5). Effectively, the relatively faster broadband speeds in US grain growing regions place US grain farmers at a comparative advantage for optimising broadband-enabled technology to achieve productivity gains.

 

Figure 5:  Quality of broadband access in the US, with a focus on major grain growing regions.
Source:  AFI analysis, from the National Telecommunications and Information Administration (data as at 30 June 2014), <http://www.broadbandmap.gov/demographics>, accessed 30 April 2015, and USDA, <http://www.nass.usda.gov/Charts_and_Maps/Crops_County/>, accessed 23 April 2015.

Broadband improvements needed to get Australian farmers up-to-speed

The Australian Government has committed to delivering high-speed broadband access to all Australians by the end of 2019, however these services may not provide sufficient broadband quality affordably to most Australian farm businesses. Many Australian farm businesses are likely to depend on satellite broadband services that can be impacted by weather events and geography. Satellite broadband services will also involve monthly download limits which may increase the costs for internet subscriptions substantially.

For Australian farmers to catch up to their global peers who already have better broadband access, there will need to be more satellites in orbit or satellite ground stations that offer faster data transfer speeds and higher monthly capacities. Inevitably, Australian farmers will continue to use their ingenuity to shape their future. However, as farmers increasingly see the potential benefits that faster and higher capacity broadband could offer their business, they will likely place further pressure on government and industry bodies to help install better broadband infrastructure that is more competitive globally. 

References

Department of Communications (2015), Australian Government’s broadband policy, Australian Government, accessed on 14 April 2015, <http://www.communications.gov.au/broadband/broadband_initiatives>
Department of Communications (2013), Broadband Availability and Quality Report, Australian Government, Canberra.
FCC (2015), Types of Broadband Connections, the Federal Communications Commission, US Government, accessed on 14 April 2015, <http://www.fcc.gov/encyclopedia/types-broadband-connections>
Griffin, T, Mark, T & Whitacre, B (2015), Assessing the Value of Broadband Connectivity for Big Data and Telematics: Technical Efficiency, Proceedings of the Southern Agricultural Economics Association 2015 Annual Meeting, Atlanta, Georgia.
John Deere (2015), Ag Management Solutions, John Deere Australia, accessed on 17 April 2015, <https://www.deere.com.au/en_AU/docs/html/brochures/publication.html?id=329bb929#1>
Mulcaster, G (2014), Observant helps farmers check stock water levels remotely, Weekly Times, accessed on 17 April 2015, <http://www.weeklytimesnow.com.au/machine/observant-helps-farmers-check-stock-water-levels-remotely/story-fnkerd2w-1226964133911>
NBN Co (2014), Fact Sheet: Satellite Support Scheme, accessed on 14 April 2015, <http://www.nbnco.com.au/content/dam/nbnco2/documents/Satellite%20Support%20Scheme%20Fact%20Sheet.pdf>

Images:  CAFNR, Gavin Tapp

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