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Nice NBN rival you built there. What a shame if someone taxed it

Government wants $7/month levy on broadband to fund loss-making services in the bush

Australia's government has floated the idea that operators of broadband networks should pay a monthly levy to fund the National Broadband Network's loss-making wireless and satellite operations in remote areas.

Dubbed the “Regional Broadband Scheme” (RBS), the plan would see carriers that offer broadband services capable at 25Mbps or more slugged with a monthly fee of $7.09.

nbn™, the entity building and operating the National Broadband Network (NBN), would not be exempt from the charge. But it would also fall on rival broadband operators, such as those who feel they can beat NBN with fibre-to-the-basement services in blocks of flats.

The levy is expected to secure AU$40m from such carriers in its first year of operation.

It's not all bad news for broadband rivals to nbn™ - other aspects of the reform package will make it easier for them to compete.

Nobody begrudges regional Australia solid communications services. But minister for communications Senator the Hon Mitch Fifield's brief statements and consultation page doesn't discuss the impact on consumers or internet service providers. The former will likely see some of the $7/month added to their broadband bills. The latter already complain of razor-thin margins and are now being asked to take on another piece of administrivia.

Perhaps more importantly, the need for a levy shows that nbn™'s business model cannot work without top-ups for remote services. On the upside, the proposed law shows a viable replacement for the universal service obligation that Australia's Productivity Commission recently said should be walked out behind the shed. ®

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