OPEL Networks - Broadband Connect Funding

Broadband Connect Funding

In June 2006, the Australian Department of Communications, Information Technology and the Arts (DCITA) under the then coalition government called for expressions of interest for discussion of how to invest up to A$878 million in funding under Broadband Connect program to provide greater access to broadband services in rural and regional areas at prices comparable to services available in metropolitan areas, $500 million of which was envisaged as being available to infrastructure projects. On 2006-09-21, the government announced they would invest up to $600 million in broadband infrastructure projects in rural, regional and remote Australia under this program. Applications for funding were open until 2006-11-30.

On 2007-06-18, in the lead up to a federal election, OPEL Networks was announced as the sole successful bidder, receiving the entire $600 million in funding under the program, as well as an additional allocation of $358 million. This was to be combined with $917 million to be invested by the OPEL Networks joint venture. The awarding of additional funding was met with some debate.

The funding agreement was signed on 2007-09-09, which was dependent upon further planning by OPEL and confirmation that it would reach the agreed levels of coverage. The then federal opposition Communications spokesman stated that they would honour the agreement, a stance maintained after winning government two months later, despite their own competing National Broadband Network proposal.

We have said all along, will honour existing contracts. There are a number of performance hurdles the OPEL contracts have to meet. That's all part of the contract. —Stephen Conroy, Minister for Communications, Lateline Business, 2007-12-05

On 2008-04-02, it was announced that the funding agreement had been cancelled. The minister cited OPEL's failure to meet the terms of the contract, specifically that analysis of OPEL's detailed maps revealed that it would reach only 72% of under-served premises, a claim refuted by the OPEL joint venture partners, who nevertheless stated that the project would not proceed.