[Note: This is a slightly edited version of an article I wrote for Crikey this morning. The main difference is a bit more linkage. There's more CeBIT / Transaction 2.0 material to come.]

In 1980 futurist Alvin Toffler wrote The Third Wave. Following the Agricultural and Industrial Revolutions, he said, we’re now experiencing the Third Wave, or what might be called post-industrial society. Australia’s surfing prowess means nothing here, though. We’re still pissing in the shallows, barely held up by leaking floaties.

Why is tech-literate, well-educated Australia so bad at marketing and profiting from its own innovation, from the fisheye lens to gene shears? We do innovate, you know.

“Australians expect the government to do everything for them — but the government’s clueless,” explained journalist and evangelist Duncan Riley at yesterday’s Transaction 2.0 conference. “The Australia 2020 Summit is a classic example. The Internet was seen as an ‘emerging’ industry. Emerging? We’ve had it for 20 years! In the US alone it employs 7 million people.”

Riley, a one-time Howard government staffer, has successfully created his own internet start-ups. Until recently he wrote for Web 2.0 bible TechCrunch. Now he runs The Inquisitr.

“Why would you invest in some Internet business when there’s no tax advantage?” he asks. “If you want to make a movie you get tax benefits. If I had a farm I’d be a millionaire by now, there’s so many special benefits.”

Riley isn’t impressed with Australia’s broadband plans: a 12Mb/sec network by 2012 when, as Crikey has reported, others already do 100Mb/sec. “We’re still stuck in the dark ages,” he says. “Once we get this always-on culture, once we get the iPhone next month we’ll finally, hopefully, get unlimited data plans, Dear God!”

Compare Australia to Israel…

With a third of the population, Israel generates 10 times as many start-ups. “Israel is the second largest contributor of companies to NASDAQ after the US,” says Israeli-born Gilad Greenbaum, Director of IT for conference organisers Hannover Fairs Australia. “In the Tel Aviv – Herzelya – Natalia triangle alone [with a population the same as Adelaide] there are 3000 technology companies.” They’re not supporting the boom. They’re 3000 businesses with their own tech to sell.

Riley is frustrated at Australian businesses’ ignorance — even those attending Sydney’s massive CeBIT trade show. “I walked out there today and said ‘Web 2.0′ and ‘Google Docs’ and people just stared at me blankly.”

Meanwhile watch out for GoodBarry and their everything-for-business-online service. Winning “Best Aussie Business 2.0 Start-Up” yesterday, they’ve just opened an office in San Fran and were last seen talking to venture capitalist Jason Calacanis. An American.

[Disclosure: I attended CeBIT and Transaction 2.0 as a guest of Hannover Fairs Australia.]

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