Internode suspends regional broadband services

ISP Internode has suspended its rollout of broadband services in regional Australia due to the premature cancellation of the Federal Government’s Broadband Connect Incentive Program.

The Federal decision has effectively stranded Internode's existing multi-million-dollar investment in broadband infrastructure for regional Australia.

During the past three years, Internode has used the Federal Broadband Connect Program to assist with its investment in building broadband infrastructure in regional Australia. Without these per-customer subsidies, delivering broadband in rural areas has been deemed by Internode as “commercially unviable”.

This means that Internode will install no new Wireless DSL services and that all its ADSL services will be available only at list prices, with no applicable Broadband Connect subsidy.

Internode has also halted all physical work on network construction in Broadband Connect areas serviced by the company. Another result of the program’s cancellation is that Internode has withdrawn its entry-level $29.95 broadband plan which was retained until now in order to make broadband more affordable for regional customers.

Simon Hackett, managing director of Internode said the firm regretted the need to take the action.

“It has been forced upon us by the unexpected and premature end of the DCITA (Department of Communications, Information Technology and the Arts) Broadband Connect subsidy program,” said Hackett.

“A newly-announced program, called the Australian Broadband Guarantee, may allow us to re-commence new service installations in the future. However, at this time, substantial apparent flaws in the announced scheme must be addressed by DCITA before that scheme will be a viable mechanism with which we could re-start delivering our pioneering broadband services in regional Australia.”

Hackett said Internode, in good faith, has made a multi-million-dollar investment to deliver broadband services in regional areas.

"We are deeply saddened that the regional communities now have to suffer while the industry resolves these shortcomings with DCITA.

"Clearly access to affordable broadband services for the whole regional community in the next 12-18 months hangs in the balance,” added Hackett.