MIKE CANNON-BROOKES: The government’s head is ‘so deep in the sand’, we’ll pay for it over decades

Mike Canon-Brookes (L). Photo: Aundray/ Flickr creative commons.

Atlassian co-founder Mike Cannon-Brookes thinks the federal government seems “determined not to do anything” in response to a global business and consumer revolution in technology, and believes Australia will be paying for it for decades to come.

“I think the federal government has its head so deep in the sand that it couldn’t see the opportunity,” he told Business Insider.

“I don’t think they’re missing (it), I think they’ve completely missed it and they’re determined to avoid it.

“I don’t pretend to understand why. But they are determined to avoid it in any shape or form for, I think, the huge detriment of the country in 10 or 20 years’ time.”

The explosion of technology across global business, the arrival of smartphones and the interaction both have with modern business and everyday life are generating entire new industries and some of the highest-paid jobs in the world. Cannon-Brookes believes Australia is missing out on the opportunities this presents through a lack of robust measures to encourage cultivation of a strong technology sector.

Pointing to Uber as an example, Cannon-Brookes said it was a “fantastic product which couldn’t have existed 10 years ago”.

“That disruption is a time period and what I worry about for Australia… as a country we’ve got to see it as a fundamental challenge to our standard of living for our kids in 20 years’ time,” he said.

Atlassian, which Cannon-Brookes founded with his university friend Scott Farquhar in Sydney, has become a global technology leader valued at over $US3 billion. It counts NASA, Facebook, Netflix, eBay, Adobe, BMW and Audi among its customers.

Atlassian’s Mike Cannon-Brookes.

Cannon-Brookes argues Australia’s failure to position itself as a significant tech producer, in an era when the entire world is reshaping around technology at consumer and business levels, will mean other countries will reap the benefits at Australia’s cost.

“As a key piece of the economy and the jobs that we’re going to have… if we’re not creating technology – not all of it – if we’re not creating 1% of technology, we’re not going to have 1% of the world’s economy.

“There’s going to come to this problem where we’re purely consumers of technology. We’re downloading all of these great iPhone games and we’re riding in Ubers and we’re using the Internet and we’re Googling stuff and we’re all on Facebook. We’re entire consumers of technology and as a country we’re producing none of it. It will be very hard to maintain our economic standing and thus our standard of living.

“I think that the federal government does not get that one iota. And if they do get it, they’re determined not to do anything about it.”

Domestic challenges

The biggest challenge Cannon-Brookes sees for the domestic tech industry is talent. He says in the short term, the solution is importing relevant skills while growing labour pools longer-term is about encouraging more people to complete technology degrees and developing education systems to incorporate technology learning.

“Technology education in primary and high school is going to be one of our biggest fails as a country in 20 years time if we don’t fix it and it may already be too late if we don’t move very fast,” Cannon-Brookes told Business Insider.

“If you look at what other countries are doing, we’re miles and miles behind and I think it’s as critical as maths or English to every single job that’s going to be done in the economy in 20 years time and education takes a long time to flow through.”

In May, opposition leader Bill Shorten used his budget reply speech to push for digital literacy and coding in schools but Cannon-Brookes says our digital future is not just about kids learning to be developers and churning out programmers.

“We don’t teach people English because they’re all going to become poets,” he said. “We teach them English because it’s important for communication and writing and everything else.

“What Code.org does very well is explain to people that learning to code is a bit like understanding the insides of a technology system and that helps you understand so much about life and improving life in any job that you’re going to do.

While basic accountancy skills are taught across multiple disciplines at universities, digital literacy is not.

“Accounting is taught…in so many different other degrees because the understanding of what a profit and loss is, what a balance sheet is, debits and credits and how that all works to go to the underpinning of businesses generally is really important. Whether you do law, whether you do commerce, whether you do computing.

“I think developers should do some accounting because it’s important for them to understand how business works so they can build better systems for it.

“I think the same thing about technology education in terms of accountants should come out understanding technology nowadays. Lawyers should come out understanding technology. They don’t do nothing, they do zero units of anything technical in their degree and I think that’s the biggest problem.

“Technology is already the largest industry in the world; it passed finance about three years ago and it’s only opening up a bigger gap.”

Policy lethargy

While the government has implemented its Employee Share Scheme legislation which ensures startups don’t pay tax on options before anything is earned from them, companies like Atlassian, Invoice2Go and Freelancer missed out on the changes because they were either more than 10 years old, listed on the ASX or had an annual turnover of more than $50 million, or a combination of a few.

As for investment, the government is currently drafting crowdfunding regulations which have the potential to open a new source of startup funding in Australia. It also introduced immediate tax write-offs and tax breaks for small business in the latest budget.

But while all those policies can assist a small tech-based company, there is little discussion of broad policy initiatives designed to encourage and foster growth of the technology sector.

(There is a bipartisan “Friends of the Internet” committee which Malcolm Turnbull is launching early next month, tasked with promoting “internet friendly” initiatives.)

Cannon-Brookes thinks the government has failed to show leadership as the economy transitions away from the resources-driven growth of the past decade towards an economy that relies more on innovation and the growth of services, pointing to energy policy as a good illustration.

This week Google launched its solar project called Sunroof which aims to up the number of solar panels installed on roofs.

“We should be embracing that. We’re in the top 10 sunniest countries in the world,” Cannon-Brookes said.

“In four or five years time it will be cheaper to produce solar energy then any other form of energy. Cheaper.

“And we just can’t put those two things together to save our lives. It’s criminal.

“I know we’ve got a lot of coal and that’s wonderful but we’re going to run out of coal soon enough. Either we’re going to stop digging it out of the ground or it’s going to become something that nobody wants because it’s more expensive.

“When it becomes more expensive to put a coal power plant together then it does to put solar panels, we’re going to stop selling as much coal as we do pretty quickly. We should be at the forefront of solar.

“UNSW has one of the best photovoltaics schools in the world and we can’t seem to turn that into economic gains for the country.

“It’s very sad.”