Issue: 20/08

Australian Broadband Guarantee developments

May 28, 2008

One of the important presentations at ATUG 2008 Regional Conference was on the Australian Broadband Guarantee – Draft Guidelines for 2008-09.

ATUG has been working on the ABG Guidelines to ensure they reflect the interest of regional end users and provide maximum choice among suitable broadband services to meet the needs of broadband users in regional Australia.

A number of significant changes have been made to the Draft Guidelines including the subsidy levels:

5.5 Draft Guidelines Incentive payments in summary:

• Standard payment for fixed wire $1000
• Wireless terrestrial in metropolitan $2000
• Wireless and satellite $2500
• Upgrade payment $600
• Special high cost payment up to $6000

ACMA is working on spectrum arrangements to support the use of wireless broadband in appropriate regional circumstances. ATUG believes this spectrum should be licenced to ensure high quality broadband is available. ACMA is currently consulting on this and other spectrum matters through its Spectrum Management Principles and Five-Year Spectrum Outlook consultations both of which close on 18 July 2008 and are available here and here
The Australian Broadband Guarantee draft program guidelines are available here
Public comment is due by COB today, 28 May 2008.

The Government announced that $270.7 million will be made available to fund the Australian Broadband Guarantee program until June 2012.

The Government has committed to invest up to $4.7 billion to build a National Broadband Network covering 98% of Australian homes and businesses. However, it is important that all Australians have equitable access to broadband, both while the network is being rolled out, and in those most remote areas that the new network may not cover.

New Australian Broadband Guarantee guidelines include:
• A higher level of broadband service than currently required.
• A requirement to offer shaped data or excess data at a capped cost to minimise bill shock.
• Standard contract clauses that protect the interests of consumers in a fair and consistent way.

Internet Service Providers (ISPs) will also have greater certainty to invest in terrestrial networks with new guidelines providing for two-year registrations and exclusivity in registered service areas up to 2012 provided certain conditions are met.

To give ISPs a clear indication of the priority areas the Government will publish online ‘heat maps’ of underserved premises eligible for the Australian Broadband Guarantee program. Payments of up to $6000 (ex GST) per customer will be provided for very remote areas to help cover the costs involved in providing infrastructure in these costly and difficult to service places.

Objectives of the Australian Broadband Guarantee

The Australian Broadband Guarantee provides all Australian residents with access to Metro-comparable Broadband Services by offering financial assistance (in the form of Incentive Payments) to Registered Providers to supply Metro-comparable Broadband Services to residential and small business premises where such services would not otherwise be available.

The Australian Broadband Guarantee is intended to allow viable internet service providers (ISPs) to extend the range of their service coverage to cover under-served areas and premises. It is not intended to be a source of financial support for Providers that enables them to maintain a viable business. Applicants seeking Registration under the Australian Broadband Guarantee are required to demonstrate that they have a viable business plan without Australian Broadband Guarantee support and that they will have a viable business case beyond the life of the Program.

The Australian Broadband Guarantee will complement the roll-out of fast broadband under the Australian Government’s National Broadband Network (NBN) by providing access to subsidised and Metro-comparable Broadband Services for those Australians in remote areas beyond the coverage of NBN services, and in other areas while the NBN is being rolled out.

Under the Australian Broadband Guarantee the Government will particularly target areas and regions in more remote areas where commercial infrastructure has not been extensively deployed and where a significant percentage of premises remain underserved. Providers will be encouraged to roll out sustainable terrestrial infrastructure into these targeted areas.

National Broadband Network

The NBN RFP document at 1.1.6 indicates the Government will build a National Broadband Network (NBN), in partnership with the private sector, which will deliver a dedicated downlink transmission speed of at least 12 Megabits per second (Mbps) over each connection provided to a premises, using FTTN or FTTP architecture, and that will be available to 98 per cent of Australian homes and businesses.

At 1.1.17 of the RFP: At the same time as this RFP is released, the Government is also separately inviting Proponents, industry, public interest groups and other stakeholders to make submissions on policy and funding initiatives to provide affordable access to broadband services to remote areas that may be outside the NBN coverage area. This could include strategies to enhance the Australian Broadband Guarantee (ABG) program to achieve outcomes comparable to the NBN. In this regard it should be noted that funding for the ABG has been extended for the 2008?09 financial year. The Government encourages Proponents who have plans for providing services to the remaining two per cent of premises to make submissions to the parallel process. It should be clearly understood that any such submissions do not form part of this RFP process.

ATUG is interested in feedback from members as part of the preparation of our submission on behalf of end users in regional areas. Email rosemary.sinclair@atug.org.au