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Rural and Remote Education - National

Meeting with Telstra representatives, 15 December 1999 - notes

HREOC: Chris Sidoti, Human Rights Commissioner, with staff: Fabienne Balsamo, David Robinson, Meredith Wilkie.
Telstra: Linda Blackwell, Dallas Isaacs, Greg Swain, Rosie Simpson, Paul Granville.

Investment pressures

"Telstra now operates in a very uncertain investment environment. Prices are coming down. Telstra is under much more competitive pressure than it was before. In pure economic terms, many rural and remote communities are quite marginal in terms of the return to Telstra."

"Sparse population centres are inevitably loss-resulting. In a sparsely populated area Telstra might spend $50,000 and it would take 200 years to get it back in revenue."

"As prices come down, this erodes the city-country cross-subsidisation that has supported many of Telstra's rural services in the past."

"Telstra now has to deal with a very large number of competitors. There are about 30 carriers that provide various forms of infrastructure. There are also around 500 Internet Service Providers (ISPs), both local and international. In addition, there are many other groups that buy capacity from the infrastructure providers and then re-sell it."

"With some services Telstra's rate of return is a fixed one, set by the Australian Competition and Consumer Commission (ACCC). So we invest but we only get a regulated rate back. This puts further pressure on Telstra's investment capacity."

"The move to privatisation of Telstra means that the organisation has to operate more competitively and be more mindful of the return on its investments."

Universal Service Obligation

"The Universal Service Obligation (USO) guarantees the following services:

"The 2.4kb transmission speed in the USO is guaranteed to all Australians, not just the 96% who have access to ISDN. The 2.4kb rate is only a minimum. Many people have access to greater than that."

"About 4.8kb is needed for a well-functioning fax system. This speed can also take e-mail but not internet."

"A review of the USO undertaken two years ago indicated that 98% of the population had access to 9.6kb or greater. This would provide for fax, e-mail and very basic text-only internet surfing. It would not enable videoconferencing."

"ISDN comprises two types of service

"ISDN is a commercial product. It is not subsidised like the telephone system which has a set rate."

"People are not required to get their service from Telstra. They are entitled to approach any other carrier. However, the other carrier would charge commercial rates and would be under no obligation to provide the service. For example, they might consider that the customer is not sufficiently creditworthy. On the other hand, Tesltra, being the Universal Service Provider, does not have this discretion. Telstra is under an obligation to provide the service. Also, the rates for most Telstra services are set rates rather than commercial rates."

"Telstra contributes to the USO levy on the basis of its market share which is 85%. $1.8 billion is the current cost of compliance with the USO."

"The USO is very generally worded. It is not always clear what it requires in specific terms. For example, a business may be planning to establish an office in a remote area and it requests a certain number of telephone lines. It is not clear if the USO requires all of the lines to be provided free of charge or just the first one."

"A number of major reviews are currently being undertaken in relation to the USO and other areas of telecommunications. There is a lot of uncertainty as to how the USO will be funded and delivered in the future. This includes whether it will be delivered by one provider or multiple providers."

"Telstra recognises that compliance with the USO requires a degree of cross-subsidisation between its rural and urban customers. Without cross-subsidisation it would not be possible to guarantee the basic rights of everyone under the USO."

Infrastructure issues

"Telstra is a major investor in telecommunications infrastructure in rural Australia."

"Over the past 5-10 years Telstra has been pouring a lot of money into initiatives to increase access to telecommunications infrastructure as well as speed and volume of data transmission. This includes laying underground optical fibre routes all across the country. It also includes modernisation of radio towers and related infrastructure in remote areas where people rely on radio systems."

"Cables radiate from local access units. In metropolitan areas the radius around the access unit is usually about 4km. In rural areas, cabling may extend for 30-40 km from the access unit. Beyond that the more isolated customers often rely on radio."

"Most Telstra customers use copper cables. The further the cables extend the poorer the line. It is often interrupted by electric fences and other factors.

"Telstra's 5 year program to upgrade the national cable system was completed in June 1999 at a cost of $3 billion."

"Two years ago, Telstra commenced the Remote Area Telephone Enhancement Program (RATE). The program involves the replacement of radio towers with high quality cabling giving data speed of 19kb. Approximately $82 million has been spent on the program."

"Upgrading of the radio system is particularly expensive in the most remote areas. $20 million was spent on the radio system for Thursday Island."

"There are a variety of factor's beyond Telstra's control that affect telecommunications access and quality of transmission. This includes the power supply, quality of modems and Internet Service Providers."

"The Government provides a subsidy for the installation of Big Pond Satellite in those remote areas not serviced by cables. The subsidy amounts to $765 or 50% of the cost of installation, whichever is greater. Relatively few people have taken it up."

" 'Big Pond' is a marketing term for a range of Telstra products including Big Pond Satellite. Telstra and many other companies have deals with the owner of the satellite to transmit their data through the relevant earth station. Satellite enables very high transmission speed, around 200-400 kilobits per second. Satellite is an alternative means of delivering internet and a range of other services including educational programs. Programs can be beamed in from the satellite in the early hours of the morning when the airwaves are relatively free and then broadcast later in the day. The high transmission speed of satellite enables very sophisticated applications including various interactive programs."

"It is difficult to make direct comparisons between states with respect to their technology infrastructure. The most significant disparities tend to be within states rather than between states. Even within states, it is difficult to make direct city-rural comparisons. To make a meaningful assessment you need to look at the circumstances of particular regions and communities. Access to technology is often influenced by local issues and personalities. A school may have a good relationship with a local internet service provider. Or the school may have principal who is very enthusiastic about IT issues."

"Blanket statements about the number of computers in schools are not always useful because they don't take into account the age and standard of the computers and whether the technology has been appropriately maintained and upgraded."

Educational initiatives

"Telstra works closely with State and Territory education departments in developing educational products. Programs that have been developed in partnership with education departments include 'Connect Ed' in Queensland, 'sa.com' in South Australia, 'Networking Tasmania' and 'Edunet' in Victoria."

"Education departments generally put out tenders for programs to be developed by or in partnership with other bodies. Telstra may or may not be the successful bidder. So partnerships between Telstra and education departments are determined largely by the tendering process. Most contracts are for 3-5 years. Telstra uses a range of Big Pond and other products to meet the requirements of its tenders."

"Telstra is one of a number of major organisations involved with the provision of online educational content. The Education Network of Australia (EdNA) is one of the most important bodies in this area. It has a central website containing a diverse range of educational resources. EdNA is concerned primarily with educational content and not issues of access or infrastructure."

"Education departments frequently engage in the practice of 'caching' - downloading material from relevant websites and incorporating it into their own sites. This is more convenient and less costly than accessing the material separately on every occasion it is used. However, the capacity of education departments and others to do this depends on sufficient flexibility in the regulatory regime governing copyright of online material."

Some examples of Telstra's education initiatives:

Telstra Galaxy Kit
"An example of Tesltra's current educational products is the 'Telstra Galaxy Kit'. This us a literacy program that can be downloaded onto other systems. The program enables children to develop literacy skills using technology. It involves 52 weeks of instruction at a cost of $120. Prior to its release the program was thoroughly evaluated by a number of universities and recognised experts in the field of literacy and education. Telstra is currently discussing licensing arrangements with the Victorian and Tasmanian Education Departments.

New South Wales Outback Satellite Education Trial
"Telstra, in partnership with the NSW Department of Education and Training, recently conducted a trial to provide high quality technology driven education programs to remote and isolated students enrolled at the Broken Hill School of the Air. It involved a number of interactive programs delivered via satellite. 12 students participated in the trial. An evaluation of the trial found it to be very successful. Families commented that the material was of high quality and delivered in a speedy and reliable manner. Home supervisors believed that the satellite system was superior to the existing radio system. In particular, the transmission was much clearer. The programs also received some constructive criticism that will be used to help improve it. It was felt that some of the lessons were very teacher driven and that there was scope for the learning to be made more student initiated." [Telstra provided a copy of Distance teaching and learning using satellite technology systems: A report on the evaluation of the NSW Outback Satellite Education Trial (October 1999).]

Connect-Ed (Queensland)
"Connect-Ed is a program to connect all schools in Queensland to a wide area network by ISDN or satellite. In Queensland there are approximately 1300 schools. The program involves the rolling out of copper cabling over a period of 12 months to connect all schools. As part of the program, Telstra is also developing a range of other products to benefit the general community. Telstra has established a lot more points of presence in rural Queensland, enabling businesses and others to access the internet more easily."

Videoconferencing
"Telstra is also talking with the Queensland Government about other ways in which we can contribute to IT development in schools. One area we are looking at very closely is videoconferencing. Telstra recently funded a trial of teaching music in schools by videoconferencing. The funding was provided through Learn-IT, a division of Telstra established for the purpose of supporting the education sector."

Pricing issues

"Most remote areas have timed local calls. A person may have to pay STD rates to speak with their neighbour who lives 4 km away. Telstra is working to improve this situation. However, it is very difficult because a lot of this is locked into legislation."

"As a general rule, 3000 is regarded as the population size needed to make it viable for an internet service provider to operate at local call rates."

"Even if there is no local internet service provider, anyone can access the internet through Telstra Big Pond for $7 per hour plus the cost of a local call."

"In some of the most remote areas it may not be possible to get a local call rate to the nearest town, even if Telstra has established a point of presence in that area. However, as a safety net, these people can still get access through Telstra Big Pond at the $7 per hour rate."

"People in the cities often get really cheap deals for internet access because service providers are brokering the deals. For example, a service provider might buy blocks of access hours from Big Pond and sell it at good rates to individuals. The service provider might sell a computer to an individual with 12 months worth of cheap internet access as part of the deal."

Skills development

"The telecommunications barriers faced by rural and remote Australians are more than just access to technology infrastructure. The barriers also relate to the human aspects such as skills development, educational content and whether the technology is relevant to the needs and circumstances of non-metropolitan Australians."

"Telstra is acutely aware of the need to improve IT skills in rural schools. Rolling out of computers, cabling and other technology infrastructure will not in itself solve the problems unless appropriate attention is also given to skills development. Telstra, in conjunction with other key players in the IT industry, has just completed a national review of IT skills. The review identified a major skills deficit, particularly in rural Australia."

"Tesltra has established a helpcall system in response to the need for greater IT skills development and support. However, it is currently provided on a contract basis."

Service issues

"The Customer Service Guarantee under which Telstra operates is enshrined in legislation. It sets out specific time periods for repairs and maintenance. Slightly longer periods are allowed for more remote customers. However, the time lag between problem and repair for remote communities has been improved considerably in recent years. In addition, Telstra has developed measures for alleviating the inconvenience experienced by remote customers while waiting for repairs to be completed. For example, a customer might be provided with a temporary satellite phone while his/her own is being repaired."

"Where remote customers are subject to delays they are entitled to rebates in the form of specific sums for each day outside the time period in the Customer Service Guarantee."

"It is rare for Telstra not to meet the time limits in the Customer Service Guarantee. This might occur in extraordinary circumstances such as a flood or other natural disaster."

"All Australians are entitled to the basic level of service provided for in the USO. This includes very remote Australians such as Aboriginal homeland communities. It is a requirement that the service be provided within 12 months although it is normally provided within 90 days."

"One of the biggest barriers to IT access for rural communities is lack of information about what is available. Many people are not aware that they have a local internet service provider."

"Telstra has established a program to assist customers in deciding the most economical arrangements for internet access in terms of rates, service providers etc. The customer enters a designated website, inserts their telephone number and the program indicates the internet service providers in their area and gives their website addresses where further information can be obtained."

"Telstra has put into place specific support arrangements for the small group of more remote customers that have to rely on satellite. This is currently provided through a service based in Brisbane. It provides a high quality service to remote customers at substantial cost to Telstra. The service is highly personalised with many customers knowing their consultant by name. Consultants visit remote communities to meet customers individually and in groups to do demonstrations and to discuss problems and issues."

Possible outcomes from the inquiry

Telstra representatives were asked to identify what outcomes they would like to see from the inquiry, in terms of measures that would assist them in providing an effective service to rural and remote Australians. They identified four outcomes.

Telstra representatives undertook to provide further written details on their desired outcomes from the inquiry. They also agreed to provide further information regarding

{.}Last updated 2 December 2001.