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High speed regional networks on the fast track.



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High speed regional networks on the fast track New arrangements under the Federal Government's $70 million Building Additional Rural Networks (BARN) Fund will increase the development of high-speed regional communications networks.

The new BARN guidelines-under the Networking the Nation (NTN) program-ensure projects supporting the development of high speed regional networks will be given higher priority by the NTN Board, who have responsibility for assessing BARN funding.

Many of the projects already approved under BARN have already met this criterion.

New regional networks could include infrastructure like wireless local loop systems, innovative satellite services and high capacity links between regional and urban centres. As a result, rural and regional users will have better access to up-to-date services such as high speed Internet connections, online service delivery, video-conferencing, mobile telephony and e-business.

The BARN program is also being modified to provide further support to the regional Universal Service Obligation (USO) contestability pilots, which are now in place. These new guidelines are in line with the Government's response to the Telecommunications Service Inquiry, which stated that BARN funding would be adjusted to encourage the development of high-speed regional networks.

Eligibility to apply for BARN funding for projects delivering new networks or network services in the USO contestability pilot areas will be opened up to for-profit organisations who have been approved as a competing universal service provider (CUSP) or who have applied to the Australian Communications Authority for approval. However, funding will not be available until organisations have qualified as a CUSP.

The NTN Board has been advised that in assessing applications, elements of the selection

criteria normally applying to NTN applications would not apply. These include the criteria relating to duplication of existing infrastructure or services-including services required under the USO-and support from targeted communities and competitive neutrality.

Further information on the BARN Fund, the NTN program and other initiatives funded through the Federal Government's $1 billion for regional telecommunications can be found at www.dcita.gov.au/ntn and from the attached BARN factsheet. Information about USO contestability and applying to become a competing universal service provider is available from the website of the Australian Communications Authority (ACA) (www.aca.gov.au), under the 'Universal Service Obligation' link.

Media Contact: Sasha Grebe, 02 6277 740 or 0409 445 246 Website: www.richardalston.dcita.gov.au

210/01 12 September 2001

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Networking the nation - Building Additional Rural Networks (BARN)

Background

Networking the Nation was launched by the Commonwealth Government in June 1997 to assist the economic and social development of rural Australia by funding projects which:

enhance telecommunications infrastructure and services; ● increase access to, and promote use of, services available through telecommunications networks; or ●

reduce disparities in access to such services and facilities. ●

The Government originally set aside $250 million for the program (the General Fund). In June 1999, the Government added a further $214 million, funded from the proceeds of the sale of a further 16.6% of Telstra, to establish a number of additional elements:

Building Additional Rural Networks (BARN) ($70m); ● Local Government Fund ($45m); ● Internet access (at least equivalent to untimed local call access) for regional and rural Australia ($36m); ●

Meeting the telecommunications needs of remote and isolated island communities ($20m); ●

Continuous mobile phone coverage on key major national highways ($25m); ● Additional mobile phone coverage in South Australia, Tasmania, and Western Australia ($3m); and ●

Networking Tasmanian Schools ($15m). ●

More detailed information about the administration of Networking the Nation and the application process is contained in the Networking the Nation General Guidelines and Selection Criteria. This is published as a separate document and is available from the

program website at http://www.dcita.gov.au/ntn or from the Secretariat on 1800 674 058.

An independent Board, appointed by the Government, is responsible for funding decisions under the General Fund. The Board also has responsibility for all but the last three of the additional elements listed above (these three have separate administrative arrangements).

Funding for each approved project will be allocated against one or more of the parts of the program described above. Applicants to Networking the Nation will be asked to nominate in

what part, or parts, of the Networking the Nation program their project best fits. So, for example, if applicants think their project is most appropriately funded out of BARN, they should specify that. Final decisions on sources of funding will be made by the Board and may vary from those nominated by applicants.

Building Additional Rural Networks (BARN)

BARN is providing $70 million over five years (1999-2000 to 2003-2004) to support the development of new networks and new network services and products, with an emphasis on the adoption of innovative solutions and leading edge technologies, the introduction of high speed regional networks and strong participation of new telecommunications carriers and service providers in project implementation. Of the $70 million, $10 million is being provided to each State, with a further $10 million to be provided for the territories, including the Pacific and Indian Ocean Territories.

The funds provided for the territories will not be further sub-divided between the territories, but will be allocated by the Networking the Nation Board based on the merit of project proposals against the Selection Criteria and Project Priorities and on the demonstrated needs addressed by proposals.

Examples of infrastructure and services that could be supported in conjunction with new networks under BARN include:

backbone data carriage services; ● wireless local loop systems; ● network management systems; ● innovative satellite services; ●

network hardware components; ● technical support services; ● training and skills development services; ● e-business and e-commerce systems; ●

online service delivery; ● video-conferencing; ● Internet service delivery; and ● mobile telephony. ●

BARN will be developed and implemented in close consultation with State and Territory Governments, to ensure that funded projects reinforce State strategies, including in such areas as demand aggregation. State and Territory input will be particularly valuable in relation to:

advice on State and Territory strategic priorities in this area; ● integration with leading-edge State and Territory government initiatives; and ● assistance to the Board and the Secretariat in assessing proposals. ●

BARN will also support the establishment of new networks and services by competing

universal service providers within the Universal Service Obligation (USO) contestability pilots commencing from 1 July 2001.

Selection Criteria

The Networking the Nation General Guidelines set out the framework under which BARN operates, including the selection criteria which the Board will apply. In brief, these are:

Meeting needs - Would the project meet an identified need within the targeted area? ● Support for the proposed project - Show that the proposal is well supported by all relevant parties ●

Providing value for money - How would the project provide good value for money? ● Ensuring project management skills - Show that the project would be well managed ● Ensuring sustainable services - Show that the project service outcomes are sustainable, or are aimed at supporting the development of sustainable services ●

Competitive neutrality - Show that the project approach is competitively neutral ●

The Board has established guidelines to ensure that projects seeking to develop innovative products and services do not compete unfairly with existing services of a similar nature. Under BARN these same principles will apply, with rigorous, transparent processes to ensure that private sector partners in projects are selected on an open basis.

Specific elements of some Selection Criteria will not apply for the purposes of projects in USO contestability pilot areas, including those criteria relating to non-duplication of infrastructure required under the USO, support from targeted communities and competitive neutrality. For-profit bodies, in addition to not-for-profit bodies, will be eligible to apply for funding in this context.

Project Priorities

BARN will support the development and implementation of innovative telecommunications and IT infrastructure and services in regional Australia. Funded projects will be aimed at:

the development of high speed regional networks; ● the delivery of new networks and services by competing universal service providers, leading to greater choice and service standards for consumers in USO contestability pilot areas;

●

the development, trialing and implementation of new services and products capable of leapfrogging present price and service quality parameters; ●

enhancing competition in the supply of such products and services to regional users; ● the development of new market models for delivery of regional communications services; ●

providing broad and lasting benefits for rural telecommunications users; and ● promoting the economic development of regional areas. ●

Key priorities for projects funded under BARN will include:

high speed regional networks; ●

innovative infrastructure and services; ● encouraging new entrants and boosting consumer outcomes in USO pilot areas; and ● private sector commitment to ongoing involvement and support. ●

Priority will also be given to:

projects which are consistent with State and local governments strategies; ● projects which aggregate existing and new demand in regional areas, and therefore improve the business case for enhanced services (a number of projects of this type are currently being funded through Networking the Nation); and

●

projects with a regional, state or national scope, and which are supported by regional bodies or by state governments. ●

Project Location

To be eligible for funding under BARN and other Networking the Nation programs, a project must be located outside the capital city of a state or territory. (Projects located in remote and isolated island communities are also eligible for funding, under the Networking the Nation Remote Islands Fund).

Eligible Applicants

Not-for-profit organisations, as set out in the Networking the Nation General Guidelines, are eligible for funding under BARN.

For-profit organisations who have been approved by the Australian Communications Authority (ACA) as competing universal service providers for the purposes of the USO contestability pilots, or organisations who intend to apply for such approval, are eligible for funding for projects, or those elements of projects, implemented within the pilot areas. Funding will not be released to such organisations until ACA approval as been confirmed.

Information about USO contestability and applying to become a competing universal service provider is available from the website of the ACA ( www.aca.gov.au), under the 'Universal Service Obligation' link.

Private Sector Involvement

Projects funded under BARN are likely to have significant private sector involvement. This is consistent with the Government's objective of encouraging competition in telecommunications. The Government is particularly eager to use BARN funding to encourage the entry of new telecommunications providers into regional telecommunications markets. At the same time, projects are likely to promote new models for service delivery across a range of regional markets.

Projects funded under BARN will also have a strong focus on meeting community needs. They will need to be supported by target communities.

New infrastructure resulting from projects could be owned either by the project organisation or by the private sector participant. It will be desirable that, in most cases, new products and

services supported through projects are vested in the private sector, either at the outset, or through a planned ownership transfer during, or after the completion of the project.

How to Apply

There are two funding rounds each year, with closing dates for each round identified well in advance, promoted on the Networking the Nation website, and available from the Secretariat.

All Networking the Nation application and grant management processes take place through a single application form, using a web-based online system. All applicants are strongly encouraged to use this system, which assures full security and privacy for users. However if you do not have access to the Internet and web facilities, you will be able to apply through an electronic form provided on floppy disk. You can contact the Secretariat on 1800 674 058 to request a disk, or clarify details of the online system. If you do not have access to a computer, you will be able to apply through a paper-based application system. Further details of the application process are contained in the Networking the Nation general guidelines, or can be obtained from the Secretariat.

August 2001

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