Since stakeholders have sensed an opportunity to exploit a perceived need for ‘announceables’ in front of a tight election, the Federal Government is now under pressure to spend billions of dollars on new regional communications investments. 

A diversion of existing funds may partially fund this. It can also be funded by expanding the $7 per month regional broadband levy to cover fixed wireless substitutes to the NBN. The levy funds NBN Co wireless and satellite operations. However, currently, 95% of the burden of the levy falls directly on NBN customers.

To propose a government-supported fibre backbone network across the country, several major global over-the-top web companies plan to meet with Prime Minister Scott Morrison. The network is said to support neutral host wireless access. As part of the meeting agenda, these companies are said to use hundreds of millions of dollars in funds earmarked for existing regional broadband funding programs.

However, the proposals have not been endorsed by the communications ministry. Rather, these are being pitched by stakeholders to take advantage of what they foresee will be open government funding as the country heads into a 2022 federal election.

Meanwhile, there are reports that NBN Co may request between $600 million and $1000 million of investment for its regional Australia. This will be intended to cater to the expansion of the capabilities of its fixed wireless network and an expansion of the fixed-line network. It will also foster a shift in coverage into satellite areas. In this case, a partial amount from the funds may also be allotted to acquire an additional spectrum. NBN Co has been quite forward in pushing for additional funding for its regional activities.

On the other hand, major telcos have criticised the vast subsidy schemes supporting regional telecommunications this week. These telcos based their arguments on the latest Regional Telecommunications Review. 

One such scheme is the estimated $300 million allotted to the universal service obligation of Telstra to provide voice services in regional Australia. Another one is the $700 million budget to fund the regional broadband losses of NBN. The Regional Broadband Scheme collected the latter. There are also hundreds of millions of dollars set to fund more projects, including the mobile blackspots program and regional telecommunications funds.

The major telcos, including Optus and Vocus, expressed concerns about what they perceive as inefficiencies in the current spending. They also raised concerns on the subsequent disincentives to adopt new technologies like advanced satellites.