money is choking australia's communications future
The future has arrived, it's just not evenly distributed. - William Gibson
In the past few weeks I've seen two presentations about the mobile web and the future of mobile phones. Both presentations talked about the need to educate the user, particularly as a way to increase adoption of new features/technology. Neither presentation discussed cost as a key factor, which seems odd to me.
I think people don't use new technology because it costs too much. In Australia, telecommunications of all kinds are a classic case. Consider mobile phones for a moment:
- Sure, you can get a great phone that does everything and even has an MP3 player and 3 megapixel camera in it. It will just cost you anything up to a couple of thousand dollars (for a phone)..
- Sure, you can do video calls and picture messaging; but you'll regret it when the bill turns up.
- Sure, you can browse the web; but you'll be paying by the kilobyte.
That last one is a kicker. I'd use mobile web content all the time, except for the fact that more or less on principle I refuse to pay for any form of "web" content that is charged by the kilobyte (and it's slow).
the total spend
When you consider the total amount being spent on communications, you find that in some ways new technology is being sabotaged by the old. The cost of landlines keeps people from spending more on broadband or mobile content.
The calls made on my landline could easily be switched to mobile or VOIP calls. So why keep a landline? I have to maintain a landline to get ADSL. No way around it, particularly when your average unit block's body corporate won't let you install cable.
With caller ID enabled my landline costs as much as my internet connection. So actually I spend quite a lot of money to get basic broadband. If the landline was cheaper, I'd spend that money on better broadband.
An average person can be easily be paying AUD$100 every month just to be connected with a landline, mobile and internet - then you pay for calls and data. The telcos do offer bundles for these services, but the so-called "broadband" is generally pathetic so they're not a good option.
how pathetic is the broadband?
It's 2006 and Telstra is still selling a $29/month plan with 200megs of included data. Megs, not gigs. Even at 256k speeds that's a joke. After you burn through 200megs, you pay $0.15/MB for the rest of the month. If you go through 20 megs a day - hardly a stretch - you'll have a $90 bill at the end of the month. Hope you didn't plan to update your operating system or download some podcasts.
Meanwhile Optus charges the same amount for just 100megs (300megs if you bundle it with other products), after which point your connection drops from 256k to 28.8k. That's right, after 100megs you'd have a better connection with 56k dialup. But at least you're not paying for extra data.
These plans are far worse than my first broadband plan (256k/3gigs), which a co-worker once described as "ghetto broadband". To really put the icing on the cake, the TV commercials for both telcos tout the benefits of "lightning fast" broadband, letting you download music and videos at broadcast quality with no delays. Some even made a big deal of how cheap it was for this amazing experience.
The reality is the connections are slow and expensive... and that's in the cities. Don't even get me started on Telstra's TVCs showing people using broadband and standard mobile phones in the outback.
Wireless access in Australia is rare and usually expensive. There is some talk of wireless coverage for major cities, but those cities who have run trials all seem to have ditched the plan after the pilot.
Nobody seems to want to pay for bandwidth... probably because it's so expensive.
what about other media?
It's not just phones and internet. Australia also has a low adoption of digital TV and pay TV.
Digital TV was greeted with hostility - nobody could recall asking for digital TV, yet suddenly we were told our TVs would stop working and we had to spend several hundred dollars to buy something called a "set top box". There was no incentive, it was just free-to-air TV with an added cost.
Unsurprisingly, takeup has been so bad that the date for analogue switch-off was pushed back from 2008 to 2012. We finally have a couple of extra channels; but I still don't have a set top box and in fact few of my friends have them either.
Meanwhile pay TV is priced firmly in the "luxury" bracket, then to add insult to injury you get commercials anyway. That's right, you pay for it; then they take money from advertisers as well and make you sit through ads.
Even so, most people would still love to have pay TV - maybe some sports, movies, comedy and music channels. Right? Well they saw that coming so each of those options is in a separate, additional package. To get that selection you have to buy everything, at a grand cost of around $92 per month.
That's on top of the $100 you're already coughing up for your phones and internet. Feeling broke yet?
No, we don't have that. Next!
education vs. cost
Getting back to mobile phones, there is a plan afoot to run an advertising campaign to explain How Mobile Stuff Works™. People buy expensive phones yet don't really know how to use them; and the industry thinks that telling people how to use their phones will have them MMSing and video calling like mad. The Shareholders Will Be Appeased.
The thing is, people will learn even the most arcane of interfaces if their level of motivation is high enough. Think of SMS - the interfaces aren't great, yet it's wildly popular. People haven't complained to mobile phone companies that it's too hard to send an SMS - they've developed ambidextrous thumbs.
So why aren't those same users going wild for MMS? Well, SMS seems cheap and MMS seems expensive. The motivation just isn't there.
Everything boils down to money. We could all have fantastic experiences with available technology if things were cheaper, but then various companies wouldn't make so much money. So we drag along with slow broadband, overcharged mobile phones and landlines which continually degrade in value and quality.
It costs so much for our phones that most people can't seriously consider pay TV even if they wanted it. It simply doesn't make financial sense to pay all that money, unless you have a large family that won't leave the house ever again if you get pay TV (thereby replacing your entire entertainment budget).
The Future™ is already happening - if you have enough money you can have it right now. But for most of us, we're cancelling pay tv and hoping this month's phone bill isn't too high. As long as the tyrrany of price continues, Autralia will remain a communications backwater.