1975 ONWARDS (continued)

1. to make OTC a more informed telecommunications authority and, in particular, a more informed purchaser of telecommunications equipment; and


2. to place Australian industry in a position where it can participate in design, development, manufacture and installation of telecommunications equipment.

Contracts have been let with a number of companies and university/industry consortia in order to achieve the above aims. Two examples are the contracts forming the programme to develop small earth stations for the INTELSAT Business Systems Service and the programme for the development of submarine optical fibre cable systems, planned for installation in the nineteen nineties. Expenditure on external R&D is expected to grow to around one per cent of revenue, provided appropriate projects are identified; internal R&D resources are being built up to match the external programme.

On the broader question of the Australian communications industry, in a report dated January 1986, AUSTRADE[71] noted that around 75 per cent of the equipment supplied by the communications industry went to Telecom, with some 80 per cent of this produced by local subsidiaries of multinationals, a dominancy, it was observed, which was not peculiar to the Australian scene. AUSTRADE reported that in addition to the major suppliers, some 250 firms are engaged in a range of activities from sub-contracting to the larger companies, to supplying equipment for attachment to the network, to provision of radio and TV broadcasting equipment. Expenditure on R&D by the industry was reported as being between three and seven per cent, well below the OECD average, while the deficit in trade in telecommunications equipment was one of the highest amongst OECD countries. A range of factors, many of which have emerged in this review of communications in Australia, was seen as contributing to these situations.

Over recent years governments of the day have taken a number of initiatives directed towards establishing internationally competitive, export oriented industries generally. These initiatives have included:

• a venture capital programme through management and investment companies


• a programme to encourage industrial R&D through 150 per cent tax deductibility of eligible R&D expenditure


• grants for industry R&D

In relation to R&D manpower employed in communications, Siva and Cawthron[72] reported in 1986 that in the case of microwave technology, Australia had some 280 researchers distributed as follows: 180 Government (including Telecom, OTC, Aussat) 50 Tertiary education (including MITEC) 50 Industry.

A year earlier Cawthron and Felsinger[73] showed that there was a total of some 290 researchers working in optical communications and distributed Government 115, Tertiary education 85 and Industry 90. These figures illustrate the relatively low level of R&D activity relating directly to commercial projects and are probably reasonably representative of the situation in other sections of the industry.

Australian Academy of Technological Sciences and Engineering