Perth-based EFTel Ltd has set its sights on providing broadband connections to rural, regional and remote areas of Australia, after the internet service provider received funding approval to supply subsidised broadband services to regional customers.
Perth-based EFTel Ltd has set its sights on providing broadband connections to rural, regional and remote areas of Australia, after the internet service provider received funding approval to supply subsidised broadband services to regional customers.
The company has recently received approval from the Federal Department of Communications, Information, Technology and the Arts to supply end-user connections to rural customers under the $60 million Broadband Connect Funding Deed for 2006-07.
The current focus on rural broadband roll out may also see the likes of the Elders Australia Rural Services division of Futuris Corp Ltd offer telecommunications products and services in regional communities in 2007.
EFTel chief executive Simon Ehrenfeld said the company would incorporate the customer bases of regional ISP’s such as Datafast, Planet Netcom and Southwest Internet.
“As a company with a very large regional customer footprint, we are positioned to benefit disproportionately from this funding initiative,” Mr Ehrenfeld said.
“Rural Australians are a particularly loyal customer group, and we are pleased to be part of an initiative that can deliver something back to them.”
The company has also recently been involved in strong acquisition activity, with three ISP purchases since the middle of July this year.
The three cash deals, worth a maximum total of $2.47 million, were funded by a $3 million Westpac acquisition facility.
The acquisition of broadband communication provider aaNet group, which has a turnover of $10 million a year, resulted in EFTel’s customer base almost doubling to 40,000.
The company’s most recent acquisition was Queensland-based ISP Instant Communications, which adds 3,000 active dial-up and broadband accounts.
Prior to this, the company also acquired WA-based Ace Online.
Mr Ehrenfeld told WA Business News that Queensland represented the fastest growing market in Australia for broadband connections.
“There are a lot more opportunities in Queensland,” he said.
“In Western Australia you have five major players competing for market share, while Queensland is very light on in regards to ISP’s based there.”
Mr Ehrenfeld said EFTel was currently reviewing a number of additional acquisition opportunities throughout Australia.
Last week, Communications Minister Helen Coonan announced the launch of the second phase of the Federal Government’s $878 million Broadband Connect program, with an investment of up to $600 million to support the roll out of broadband infrastructure throughout the country’s rural, regional and remote areas, which have limited or no access to broadband internet services.
However, Australian Tele-communications Group director Dr Walter Green said the November 30 deadline for applications for funding may prove to be too soon.
“Senator Coonan has said she wants to fund large consortiums [rather than single companies]...But it would take a good six months of negotiations [in order to develop consortiums].”
Under the program’s guidelines, the government funding would support infrastructure to under-serviced areas that otherwise would not get the same access as metropolitan areas.
Broadband providers will be locked into 10-year contracts to guarantee grant money is spent efficiently, with providers expected to lodge costs and maintain quality forecasts to be eligible for the funds.
Funding is limited to 500 local government areas, with projects expected to be implemented during the 2007–08 and 2008–09 financial years.
