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Govt to dump broadband subsidy due to Telstra NextG pricing

The Minister for Broadband, Communications and the Digital Economy Senator Stephen Conroy has announced changes to the Australian Broadband Guarantee (ABG) that will see subsidies dumped in areas served by Telstra NextG wireless broadband.

ABG DBDCE Senator Conroy yesterday announced new standards for the ABG, that redefine the minimum standards for service provided under the ABG as well as slash government expenditure on subsidies to deliver ‘metro equivalent’ broadband services to remote communities.

“Since the Rudd Government renewed funding for the ABG in 2008, fifty-nine thousand Australian households and small business premises have been assisted by the program,” Senator Conroy said.

“After positive consultation with a number of satellite and wireless internet service providers, the Government will raise the minimum standard for services provided under the ABG.

“This means from July minimum broadband speeds will be doubled to one megabit per second download, and 256 kilobits per second upload, with stricter performance standards and a stricter testing regime.”

The minimum data allowance will also be doubled to six gigabytes per month. Customers will be further protected by a three year warranty, up from the current minimum of one year.

The changes to the ABG come as per recommendations in the report of the Glasson Committee on Rural and Regional telecommunications, which highlighted the need for the ABG to keep relative parity to the increasing speeds and download limits of metro broadband services until the NBN is rolled out to these areas.

After conducting independent testing of Telstra’s NextG network, The Department of Broadband, Communications and the Digital Economy, the DBCDE concluded that Telstra NextG is ‘metro-comparable’ under the definition of the ABG in most areas of the network. As a result, from July 1, the ABG program will no longer subsidise new customer connections across these NextG service areas, except in areas beyond Telstra’s handheld mobile coverage or in any black-spots.

“Customers already on the program, wherever they live, will be offered the upgraded minimum threshold service within the same price cap as currently exists,” Senator Conroy said.

DBCDE will continue to offer registered wireless providers the subsidy for eligible new customers, within their existing service areas, for a further year, in order to help these providers to write down previous investments in these areas.

ABG Broadband DBCDE
ABG program changes double speed and download guarantees

David Olsen

David Olsen

An undercover economist and a not so undercover geek. Politics, business and psychology nerd and anti-bandwagon jumper. Can be found on Twitter: <a href="http://www.twitter.com/DDsD">David Olsen - DDsD</a>

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