Government "underestimated" broadband guarantee demand

The Department of Broadband, Communications and the Digital Economy "underestimated demand" for the Australian Broadband Guarantee (ABG), according to Reginald Coutts, one of the members of the National Broadband Network expert panel.

Last Friday, the Minister for Broadband, Senator Conroy, brought forward $23.8 million in funding to support "strong demand" for the ABG, a program that subsidises people who are unable to access metro-comparable broadband services.

The funding was designated for use over the coming years but as Senator Conroy is spending it now, the department will conduct a review of  funding requirements as part of the "normal budget cycle," a spokesman said.

"It is important that people are able to access broadband services while we deliver the National Broadband Network, and that is why we have brought forward Australian Broadband Guarantee funding for this financial year," Senator Conroy said.

"Such strong demand for the Australian Broadband Guarantee is further evidence of a growing demand for better broadband services across the country and the need for better services in regional Australia."

Government "underestimated demand"

National Broadband Network expert panellist Reginald Coutts said the move was an indication the government had "underestimated demand" for the scheme.

He did, however, say that in the "short term" the need for broadband "outside the cities" had to be addressed with ABG funding.

"They've really got to be addressing, in the short term, the need for ongoing broadband demand outside the cities," said Coutts, who envisaged the additional funding would be used for satellite broadband and services like Adam Internet's new WiMAX network in Adelaide.

"I think they're envisaging more of those," Coutts said.

Coutts said the previous Howard government, who didn't allocate ABG funding beyond 2008, "caused a lot of consternation".

But Nigel Pugh, an analyst at Ovum, believed bringing the funding forward would not adversely impact the ABG scheme in future years.

He believed funding requirements would reduce as the NBN roll-out and ABG "dovetailed" over time.

As well as bringing forward funding for the scheme, the Government "enhanced" the services delivered under the program, tripling the monthly download limit for a metro-comparable service.