Australian SMEs will contribute an additional $4 billion annually to GDP once the National Broadband Network rollout is complete, according to new research. However, rural areas will not be the biggest beneficiaries of the network.
At the heart of this growth will be a new wave of digital services that will transform how SMEs interact with suppliers and customers, according to the University of Melbourne’s Economic Benefit of the National Broadband Network report.
These services will help growing SMEs to further boost productivity, reduce costs and improve their customer service, the report concludes.
The $4 billion boost represents a 1.8 per cent long-term increase in real GDP. The report also suggests that it will contribute a 1.2 per cent increase in export volumes and a 2 per cent rise in real household consumption, all while delivering a 0.6 per cent reduction in CPI inflation.
And, despite much political rhetoric about the advantages of the NBN, the report suggests the major benefits will not be seen in regional and rural areas.
“While the NBN undoubtedly increases the availability of high-speed broadband outside the metropolitan areas, our results show a greater stimulatory effect will occur in major metropolitan areas, but with some significant additions in the regional areas of the east-coast states,” it said.
“The stimulatory effects are greater in the large cities because of their larger economies and populations.”
Nevertheless, Ben Salmon, executive general manager of business at NBN Co., said the network is driving positive change for Australian SMEs and will continue to do so.
“For regional Australian businesses, it has the benefit of providing greater flexibility and access to global markets. We are already seeing the rise of new ‘Silicon Suburbs’ around the country as universal access to fast broadband drives entrepreneurialism and innovation outside metro cities,” he said.
Currently, nearly 2 million homes and businesses nationwide are able to connect to the NBN. According to Mr Salmon, every Australian will be able to do so by 2020, when the rollout will be completed.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.
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