Australian Budget 2013: Government scales back NBN advertising

The federal government will pump in AU$17.8 million to promote the National Broadband Network (NBN), and over AU$21.4 billion for the construction of the network over the next four years.

In the 2013-14 Budget released on Tuesday, the government announced that it would expand the Digital Local Government program, adding 14 new local councils that will be taking part in the program over the next two years at a cost of AU$5.7 million.

The program aims to help councils prepare for the rollout of the NBN in their local area, and each council can receive up to AU$375,000 to improve the delivery of services to residents using the NBN.

Communications Minister Stephen Conroy said in a statement that already, over 30 councils have secured funding as part of the original program.

An additional AU$7.2 million will be spent over the next three years as part of an expansion of the Digital Enterprise program that aims to train small businesses in how to get online. This program has already trained over 4,500 people, and the expansion will see 21 new services.

There will be a "virtual service" for remote Australia, and there will be 3,650 group training and 14,350 one-on-one sessions for 49,000 small businesses, Conroy said.

After spending AU$20 million in 2012-13 for advertising on the NBN, the government has scaled back its marketing efforts for the NBN to AU$4.9 million in 2013-14 "to continue to improve public understanding and provide updated information about the National Broadband Network".

According to the Department of Broadband, Communications and the Digital Economy's Budget statement, AU$2.4 million will also be spent in 2013-14 to "maintain existing essential functions" for Australia's transition to the NBN. According to the department, this will ensure that the government can maintain oversight of the regulatory and operating environment of the NBN.

AU$2.5 million will also be spent to extend the satellite phone subsidy scheme out until June 30, 2014. The program provides phone access for 24,000 Australians who live or work in regional or remote Australia.

The government had previously not outlined whether it would extend this program, but Conroy said on Tuesday that it would review the scheme at the end of 2013 to see whether it needs to be extended further. He also said that NBN Co's fixed-wireless rollout would help improve mobile coverage, which in turn would reduce the need for the satellite phone program.

"With the rollout of NBN Co's fixed-wireless network, mobile carriers can use NBN Co's towers to improve their mobile coverage footprint. NBN Co has already agreed to reciprocal access arrangements with Telstra and Optus," he said.

Vodafone has also been in discussions with NBN Co about accessing its towers to improve its network coverage, and the Coalition has suggested that focusing on improving mobile coverage in regional Australia will form a key part of the Coalition's broadband policy.

The Australian Communications and Media Authority (ACMA) will receive AU$26.6 million to restack the digital television channels to free up the spectrum to be used by mobile telecommunications companies to deliver 4G services. The government said the funding would cover previously unforeseen costs around the replacement of equipment and the decommissioning of high-powered transmission sites.

The Department of Broadband, Communications and the Digital Economy said it will see decreases in funding over the next four years, as the Digital Productivity, ICT Centre of Excellence, and Satellite Phone programs are phased out or receive reduced funding.

As the government prepares to put legislation to parliament over mobile roaming charges, it will provide AU$1.3 million to the Australian Competition and Consumer Commission (ACCC) over the next four years to investigate wholesale and retail mobile roaming charges between Australia and New Zealand. The ACCC will produce an annual report on pricing changes, and the AU$1.3 million will be recovered through annual carrier licence charges.

The Department of Families, Housing, Community Services and Indigenous Affairs will also spend AU$9.9 million over the next four years to upgrade the Broadband for Seniors kiosks.

"This will ensure senior Australians continue to have access to the latest in information technology, and allow them to both remain socially connected over the internet and access the benefits offered by the National Broadband Network," the department said.

AU$5 million will also be spent to train seniors on cybersecurity issues.

NBN funding

The Budget has revealed that the delay to the National Broadband Network construction has pushed out equity funding for NBN Co further than expected.

The 2012-13 Budget forecast that NBN Co would receive equity funding in that financial year of AU$4.7 billion; instead, the government said it had only injected AU$2.6 billion into the government-owned entity.

This has meant that the funding requirements will be lower this year, but higher in the subsequent financial years.

The government has said it will fund NBN Co with AU$5.1 billion in 2013-14, before peaking at AU$6.3 billion in 2014-15, and then dropping to AU$5.3 billion in 2015-16, and AU$4.7 billion in 2016-17.

This will mean that total equity funding over the four years will be AU$21.4 billion of the total AU30.4 that the government has estimated it will inject into NBN Co.

The cost of termination of the contracts that NBN Co has entered into have been estimated to be AU$3.4 billion as of February 28.