Rural and Remote Education - National

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:

• standard telephone

  service at a minimum speed of 2.4 kilobytes (also sufficient for basic

  fax and e-mail)

• pay phones
• digital data service

  (currently provided by Telstra) consisting of

  • ISDN which

    is available to 96% of customers

  • Big Pond Satellite

    Service for the 4% of remote customers who cannot get access to

    ISDN."

"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

• Primary rate ISDN

  is used by businesses, especially internet service providers. It involves

  connection of fibre optic cabling to the premises, giving a data speed

  of 2 megabytes per second. This service is provided on a commercial

  basis.

• Basic rate ISDN

  is typically used by residences, including small businesses operating

  from home. It involves connection of copper cabling to the premises,

  giving a data speed of 128 kilobits per second. This data speed can

  handle sophisticated applications such as videoconferencing."

"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.

• Investment

  environment
  

  "We need an investment environment that gives us the incentive to roll

  out services. There is a lot of uncertainty in the investment environment

  at present and this makes it difficult for us to make the firm, long-term

  decisions we would like to in some areas of service provision."

• Soft infrastructure:

  skills development
  

  "There is an urgent need for improvements in local technical capabilities

  to support the technology infrastructure of rural and remote communities."

• Soft infrastructure:

  content development
  

  "There needs to be more online content that is relevant to the needs

  and circumstances of rural and remote students and their communities."

• Copyright issues
  

  Copyright requirements should not result in an overly restrictive environment

  for education providers in accessing online material. Education departments

  and others should not be unduly constrained in the practice of 'caching'

  online material for educational purposes. We are concerned that this

  might be an outcome of the current parliamentary inquiry examining copyright

  issues for online material." [House of Representatives Standing Committee

  on Legal and Constitutional Affairs Inquiry into the Copyright Amendment

  (Digital Agenda) Bill 1999.]

Telstra representatives

undertook to provide further written details on their desired outcomes

from the inquiry. They also agreed to provide further information regarding

• pricing of Telstra

  products and services

• data transmission

  speed issues

• Telstra's arrangements

  with the Catholic school system

• Telstra's activities

  with the NSW Department of Education and Training.

{.}Last

updated 2 December 2001.