The cost of connecting some regional areas to broadband – via satellite and fixed connections – is high enough that it is just not profitable.
Currently, this is solved by cross-subsidising internally within NBN, but if a new plan from the Department of Communications goes ahead, as of July next year a $7.10 per month charge will apply to the ISP bill of every customer with a fixed-line broadband capable of 25Mbps or more – with the money to be put towards a newly drafted “Regional Broadband Scheme”.
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According to ZDNet, the fee won’t apply to fixed wireless, satellite, exchange-based DSL, inactive broadband services, or transfers to NBN from Telstra and Optus.
The 210 page “NBN non-commercial services funding options” report, written in March 2016 and released on Monday, details a $9.8 billion cost over the next 30 years for the regional services. The proposed $7.10 fee, charged to ISPs directly with costs assumed to be passed on to consumers, is expected to raise $370 million from NBN, and $40 million from other broadband providers.
The Department of Communications said NBN suggested mobile broadband users should contribute to the scheme. NBN’s main competitor, TPG (operating thanks to a loophole on legislation) said it would look at offering fixed wireless services to avoid the fee altogether.
The Department of Communications is estimating 380,000 non-NBN customers could be contributing up to $44 million into the scheme by 2022, with NBN the only beneficiary of the fees at this point.
The scheme is currently at “draft legislation” stage, with consultation open until February 3, 2017.
Internet access in regional Australia is so bad that recently a coalition was formed to fight for better coverage.
The Australian Communications Consumer Action Network (ACCAN), the National Farmers’ Federation (NFF), the Country Women’s Association of NSW, the Isolated Children’s Parents’ Association and AgForce Queensland are among the members of a new coalition fighting to end the rural “data drought”.