Australia is just no good at exporting technology.
We got it right with Kylie’s bum, we got it right with The Wiggles, but for some darn reason we put a bunch of computers on a ship — under humane conditions, of course — and send them off to sea and nobody will take them.
But seriously for a moment. The Australian Computer Society (ACS) study berates the Government and the industry about an information and communication technology (ICT) trade deficit. There are definite reasons to be concerned about this: There are a lot of smart people in this industry producing some great things, and we should be constantly reminding the Government about the need to support them.
But let me attempt, and let me emphasise the word “attempt”, to debunk a few things.
If you split possible ICT export categories into three categories — as we do for most things in the ICT industry — we have hardware, services and software.
For the first two, you’d be a lucky country to have an ICT surplus. We live in a region dominated by countries that can produce hardware and components at significantly lower costs than anywhere in the world, especially us. While we can add value at the level of the customer, commercialising hardware to sell overseas is a mean feat and hats off to anyone who has found the formula to pull it off.
Services too are not an easy thing to export. We deluded ourselves into thinking we could during the dotcom boom, but we were exporting ideas, not services. When it comes to the services that organisations need to run their business, it’s tough now — and it is not going to get any easier to compete with call centres in Karachi and consultants in Calcutta.
So we are left with software as a potential export earner. It is software with which Australia has had its most luck to date and this will probably continue to be the case.
Mincom, Technology One and Prophecy have had their ups and downs but they continue to enjoy profits, even during industry downturns, and are paving the way for many more software developers.
Australia is a clever country, considering its relative population. Software developer, Presence Online, added enough value that IBM felt the need to acquire it; SnapGear added so much to networking devices that it has been poached by US vendors twice, and Radiata was so successful in the wireless space that Cisco felt the need to acquire it.
In a country as small as Australia, the focus should be on commercialising the areas in which it can compete. Australia excels at research and development — not manufacturing and exporting of IT.
These are the areas the Government needs to throw its weight behind. But granted, the ACS has a point that politicians need to be doing their bit to attract multinationals to conduct more activity here.
The real value in Australia gets added in the IT channel. It takes commodity products and turns them into business solutions. That is its goal.
It just doesn’t look so great on the balance sheet.