Can the NBN ‘save’ our cities?

The fact is that moving large quantities of data at high speed isn’t a key determinant of where most firms locate. As I’ve noted before, if anything, telecommunications has increased the demand for face-to-face contact, not reduced it. And maximising connections between people is precisely what big cities excel at.

I don’t think rents matter much in all this. And anyway I doubt that regional centres offer rents so much lower than those on offer in middle or outer suburban office parks that they come within cooee of offsetting the foregone benefits of a big city location. Also, the likelihood that regional centres will be less congested isn’t an advantage - in this context it’s more likely a sign of lower desirability.

That small proportion of firms (or more likely, functions within firms) that is constrained by high data transfer requirements could indeed move to NBN-enriched regional centres, but they could also move to the suburbs and enjoy the advantages of a big city. Or they could out-source to overseas suppliers.

In Melbourne at least, they could even locate in the city centre. I noted a few weeks ago that NAB and ANZ have set up their international headquarters in Melbourne’s Docklands precinct. The availability of low-rise “large floor plate” buildings means they can potentially consolidate the major part of their corporate operations in one (very central) location.

So I can’t see the NBN having a major impact on the relative shares of population growth in regional centres and our two largest cities. But I do see it having a positive effect on life in the regions. That will, as Mr Windsor says, be in part about applications like education and health services, but it will also make it easier for regional residents to start up viable information-heavy small businesses like this one.