Extract: AARNet reveals birth of Australia's ISPs

Academic research network AARNet today launched a book that documents how the Internet was established in Australia. 

Titled AARNet: 20 Years of the Internet in Australia and penned by Glenda Korporaal, the book explores how Australia's commercial Internet network, as we know it today, was originally developed within Australia's academic community.

Of the many fascinating chapters, CRN was most interested in the development of the ISP market. We hope you'll enjoy the extract below...

While the Australian Academic Research Network (AARNet) was set up to service its membership [of universities], it was always envisaged that there would also be “affiliate members”, such as government departments and quasi-government organisations, which would be allowed to use it. It was also planned that affiliates would be charged a higher rate, providing the basis to generate some more revenue which could help defray the cost of the network.

The AARNet board developed an “acceptable use” policy for the network which allowed expanded access to the network but drew the line at any use for purely commercial purposes. The affiliate membership program was launched in January 1991.

There were two kinds of affiliates. Mail affiliates who used dial up connections or ACSNet to obtain electronic mail and access news. They paid a nominal fee of a few hundred dollars a year to AARNet and a fee to the institution they connected to. Then there were full network affiliates which used AARNet to get an IP connection.

By 1992... there were 141 mail affiliates, ranging from one person systems to entire government departments.

In 1992, the board decided to expand the affiliate membership program. One of the first commercial Australian internet service providers, connect.com started by network engineer Hugh Irvine, Joanne Davis and Ben Golding, gained access to AARNet under this program.

Another outside organisation to attach itself to AARNet early on was Pegasus, considered by many to be Australia’s first internet service provider (ISP). Formed in June 1989 by a group of concerned environmentalists wanting to keep in touch with their colleagues around the world, it initially connected to the internet by ACSNet. Its founders met [ANU computer systems manager and AARNet network designer] Geoff Huston who suggested they make a permanent connection to AARNet although its rules officially did not allow commercial traffic. As Pegasus founder Ian Peter, who started the organisation from his home in Byron Bay, recalls in the book, Virtual Nation: “We sneaked in via sponsorship by the University of New England and Melbourne University and our first permanent connection [to the internet] was underway.”

Another organisation which made an early connection to AARNet was Internode, founded by Simon Hackett, who left the University of Adelaide in 1991. Internode’s early business included being the national agent in Australia for TGV’s MultiNet TCP/IP software, the software of a US company he had met at the Networkshop in 1989.

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By the end of 1993, after only two years of its operation, the affiliate program generated about 15 percent of AARNet’s income and provided communications services to more than 300 companies and government bodies across Australia. The challenge of handling the increasing demand for access from affiliate members was to be one of the major issues facing the AARNet board and its staff.

To raise more revenue, the AARNet board decided to further open up the categories of users. While it had no plans or capability to open up the network to the general public, it was proposed that AARNet be available to wholesale “resellers”. These could resell services to the general public, providing them with the appropriate customer support. The decision provided another very valuable source of revenue for AARNet without the need for the Australian Vice Chancellors Committee [which oversaw AARNet] to implement a retail billing system or set up a call centre to support thousands of end users.

In May 1994, AARNet was opened up to “value added resellers” or internet service providers. The resellers were charged for access for permanent links on a fixed cost basis. In turn, they typically charged retail customers for ‘dial up’ access on an hourly basis. Some of AARNet’s initial “mail only” affiliates, such as Internode, upgraded themselves to become ISPs while other new organisations also joined.

Another early customer was a company called OzEmail, which was founded by computer enthusiast, Sean Howard, in the eighties as an electronic mail service called Microtex. Howard sold his computer publishing business to Kerry Packer’s Australian Consolidated Press and transformed Microtex into OzEmail. With the backing of investment banker Malcolm Turnbull and ACP executive, Trevor Kennedy, the company was relaunched as an internet service provider.

Their ranks were also joined by another start up ISP, Michael Malone’s Perth-based iiNet.

It was [AARNet customer service manager] Brenda Aynsley’s job to manage the value added reseller program.

She recalls: “They were paying an extraordinary amount of money by today’s standard for this service which was well and truly substandard by today’s benchmarks, but it was the best game in town in those days.”

Aynsley found herself approached by many new potential internet users who did not comply, even with the expanded guidelines, all trying to hustle their way onto AARNet. While many were rejected, with other organisations closer to the guidelines, an effort was often made to find some justification for admitting them as members.

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Extract taken from the new book ‘AARNet: 20 Years of the Internet in Australia’ by Glenda Korporaal and published by AARNet. Reprinted with permission.