Australia seeks to tax broadband rivals to fund national infrastructure roll-out
Tue 13 Dec 2016
Australia’s coalition government has released draft legislation which will require private sector broadband providers to contribute substantially to the National Broadband Network (NBN), currently set for a growth phase intended to close up the rural gaps in connectivity due to lack of private investment.
The country’s Communications minister Mitch Fifield announced that the government hopes to pass legislation to establish a Regional Broadband Scheme worth $30-40 million AUD. The scheme would impose a levy of $7.30 on private superfast broadband providers, rising in increments to a ceiling of £8 per month by 2022.
The Regional Broadband Scheme would hope to raise $40 million from non-NBN carriers in its first 12 months, with the ultimate intention of making NBN the default provider for the entire nation, with carriers buying into the backbone.
The Consultation on the Telecommunications Legislation Amendment (Competition and Consumer) Bill 2017 and Telecommunications (Regional Broadband Scheme) Charge Bill 2017 is mooted for July of 2017, with exposure drafts open until 3rd February.
Yesterday the European Union announced funding procedures for its own initiative to tackle the problem of connectivity tundra, in the form of the Connecting Europe Broadband Fund, which instead of imposing levies on the private sector is seeking private investment driven by anchor investment from three major European banks in France, Germany and Italy.
It’s a high-pressure move which promises to redefine the telco business sector in Australia, leaving the private sector no option but acquiescence or complete withdrawal. However, the unusual geographical nature of the country would seem to leave little option except government-defined terms.
Australia’s own problem with broadband infrastructure is more difficult to tackle than Europe’s, due to a sparse population dispersed over large and remote areas – a problem which has occupied the Australian government considerably in the last 15 years.
Industry has criticised Australia’s ten-year road towards what they consider to be state-sanctioned payola, claiming that the levies could cost them 30% of their operating profits.