NBN Co brings back regional broadband subsidy

The Australian government, through NBN Co, will subsidise the satellite connections of up to 9,000 regional broadband users at a cost of AU$15.6 million.

NBN Co will fund the cost of equipment and installation for satellite services to up to 9,000 premises across regional and remote Australia for approximately AU$1,733 per premises.

The AU$15.6 million in funding announced today also comes as part of an overall AU$34 million package that will see capacity added to the existing NBN Co interim satellite service to relieve capacity constraints for the 44,000 customers on the service already, as first reported by ZDNet in February.

NBN Co has added additional capacity to the service, and has also implemented a new stringent fair use policy and monitoring service to ensure that access to the service is improved for everyone.

A spokesperson for the minister told ZDNet last month that capacity will be increased by one third, from 30kbps to 40kbps, and the new arrangements will see their download speeds in peak periods increased from below 500kbps to above 1.5Mbps.

Communications Minister Malcolm Turnbull announced the agreement signed with the interim satellite operators IPStar and Optus to increase capacity on NBN Co's service this morning.

NBN Co will set up a new subsidy scheme, similar to the former Howard Goverment's Australian Broadband Guarantee program that was removed by the former Labor government when the NBN interim satellite service was established in 2011 at a cost of AU$351 million.

NBN Co will fund the cost of equipment and installation for up to 9,000 premises, while satellite broadband retail companies will set the prices of packages on offer to those customers. The premises will be on a traditional commercial satellite service rather than NBN Co's interim satellite service. Turnbull said that there will be tight restrictions on who can apply for the subsidised service.

"The eligability requirements will be scrutinised very carefully. These will be for people who genuinely don't have access to broadband," he said.

The government has indicated that new users will be able to register for the new service "in coming months". Turnbull said that the two Ka-band satellites are expected be launched from the second half of 2015, and a review of NBN Co's fixed wireless and satellite services is due out this month.