Australia is a nation of cities

Once better resourced, Australia's urban environment can satisfy the craving for meaning and confidence.

Another problem is that state and federal governments still want to service our urban areas in terms of traditional public policy departments - the old-fashioned tribes of transport, industry, agriculture, fisheries, mining and the rest are nineteenth century responses to government.

In a post-industrial age, the organisation of urban government around the agencies of a previous era subverts good outcomes.

Any company that loses sight of the customer is going to miss strategic opportunities. It's the same for government. That's why we now confront:

• an inadequate revenue base for capital cities;
• ageing infrastructure;
• loss of autonomy for city government and the power to set strategic directions; and,
• confused stakeholders - whether they be investors, visitors or residents.

The Property divides the problem and solution in two - what we call "software" and "hardware".

First, hardware.

We have inherited an infrastructure designed for the industrial era. We need one that will satisfy the needs of the Nintendo generation that will soon dominate the lives and culture of our cities.

For most of this century, infrastructure was of a vanilla flavour - gas, electricity, water, motorways, sewerage that served everyone in the same way. There were never an intention that infrastructure could be customised - it was one size fits all.

Today the story is different.We need an infrastructure that deals with a society of networks - virtual and real. Transport is one priority. The other is the infrastructure of the information age.

Bill Gates was very keen earlier in the decade to talk about frictionless capitalism, by which he meant a marketplace without physical barriers. His thinking has evolved to talk of doing business at the "speed of thought", which requires what he calls a "digital nervous system".

That's the sort of strategic infrastructure that needs urgent funding.