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TUANZ December Column

01 Dec 2009

The third TUANZ Rural Broadband Symposium, held in Rotorua last month, was the moment when the prospect of fibre to New Zealand farms became real.

It was an exceptionally positive event, for several reasons.

First, the active involvement of Federated Farmers. These guys really get it. They understand the enormous  potential of ultra-fast broadband to revolutionise farm management and productivity, rural health and  education services, and improve the attractiveness of farms as workplaces for the digital generation.

Second, because fibre to the farm is here and now. Several examples were quoted where farmers and service  providers are quietly going around rural areas with mole ploughs and ducting, burying fibre and bringing broadband to the boondocks at city speeds or, frequently, better.

Third, because we can now see the detail of how this connectivity will be used. Some of the early applications  are already here – in health and education, for example. In the latter case the motivation is  defensive as much as progressive – the rural/urban divide will deepen markedly if the communications gap  widens.

Fourth, because the taxpayer money is on the table. ICT Minister Steven Joyce affirmed that again – not that  any reaffirmation was needed. Sure, there were quibbles about perceived lack of balance between the rural and urban allocations; it’s always tempting to ask for more. But these were balanced by positive statements  from well-informed people like Jamie Baddeley of FX Networks, who pointed out that the $300 million allocated should buy around 13,000km of installed fibre, which would service far more than just the rural  schools.

But there’s always a moment of enlightenment in any good event, and it was the presentation from Gen-I’s  David Walker and Brian Shackleton about RuralZone that really spun my tractor wheels.

RuralZone is about  the creation of end-to-end value chains. In Shackleton’s words, it has the potential to  move farming from  production ‘push’ to demand ‘pull’. It brings together data from a wide range of sources both on and off the farm. It combines production data, stock movements, processor data, milk vats, effluent  management, and data from retailers and end consumers. It builds data collection into existing processes, so as  to minimise additional collection effort.

It relies on greater broadband penetration, so that farmers can share the data with others in the wider supply  chain, both upstream and downstream. It brings the data together into a single farm dashboard where a wide range of real-time, relevant data essential to the efficient use of farm resources is visible. It’s not too different  conceptually to the dashboard of data available routinely to a corporate CEO – and why should farmers settle  for less?

The presentation brought back a long-past memory for me. Twenty-five years back, in an earlier career, I was  heavily involved in the introduction of bar coding to the grocery industry. That change revolutionised the sector.

Suddenly manufacturers and retailers could track line items from manufacture to consumption. Invaluable data  was revealed: what combinations of product did consumers buy, which products sold more heavily at different times or different seasons, how price-sensitive were different categories, and so on. Decisions in  which the parties had relied on intuition were now supported by rock-solid information, gathered from a diversity of sources and shared up and down the supply chain for the common good.

That, I suspect, is where the benefit of fibre and RuralZone will come for farms. Better data equals better- informed decisions, which equals better resource allocation and higher profits.

And in the vast ecosystem that is New Zealand’s agriculture sector, a percentage point or two added to the  profit makes the cost of fibre look like petty cash.

Hence my musing aloud that RuralZone, or something equivalent, could be the ‘killer app’for fibre to the  farm. All power to Gen-i and the others who are working in this ground-breaking space. Moving farming from production push to demand pull could be an enormous benefit to this country’s economy.