The Australian Government should consider offering tax breaks, subsidies and other incentives to set up an iPhone-style environment in which developers are encouraged to work up applications for the National Broadband Network, according to a top Deloitte executive.
Jim Sloane, Deloitte’s UK vice chairman and a leader of the consulting firm’s global telecommunications industry team, put his ideas in a media release and a video podcast following recent visits to Australia.
He said the race is on to identify how NBNCo will affect current consumer behaviour, disrupt business models, and create new opportunities for business growth, acquisitions and development.
“I believe the challenge in Australia is to create that innovation, that excitement and enthusiasm for developing applications that will drive traffic and revenue on the network,” he said. ” For example, what led to the success of Apple’s iPhone is its continuous adoption of innovative applications now numbering in the thousands [in fact they’re approaching 100,000 Ed.]
“Similarly, the success of the NBN will depend on the creation and utilisation of applications that can be used on this vast network.”
Sloane believes innovative applications will not originate from telcos or NBNCo “they’re going to come from individuals and organisations that perhaps do not even exist today,” he said.
But that means the Federal Government must provide incentives. “You see it in other countries, where for example targeted tax breaks such as R&D tax allowances act as incentives to encourage companies to move down this road,”
“Without widespread development of new applications, there is a danger that all you will have is a very fast but largely empty and under-utilised network with a very considerable capital cost.”