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Australian bush WiMax network gets go-ahead

Tags:
Battle,
Deal,
Court,
Funding

Jo Best ZDNet Australia

Published: 10 Sep 2007 11:57 BST

Despite an ongoing legal battle that threatens to derail the network, the Australian government and OPEL have sealed a deal that will bring WiMax to the bush.

The communications minister Helen Coonan yesterday announced that the funding agreement with OPEL, a joint venture between Optus and Elders, has gone ahead. The new network, which will use long range wireless broadband technology WiMax, will deliver 12Mbps connectivity over 63,000 square km, according to the minister.

The deal will see the government contributing around AU$938m (£380m) to the WiMax development, with Optus and Elder investing around the same amount in the joint venture.

OPEL is scheduled to have the network live by June 2009, and will act as a wholesaler for access.

The bush WiMax network, however, is still the subject of an ongoing legal battle between the government and Telstra, which had previously submitted a tender to build the network.

The telco and the Minister are now engaged in a court case after Telstra alleged Coonan refused to give the company access to papers revealing how the winning tender was selected. According to Telstra, only OPEL was made aware of an increase of around AU$300m (£121m) in the amount of funding available for the network.

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The minister rejected Telstra's assertions saying the case resulted from sour grapes after the telco was beaten "fair and square" by its rival.

A spokesperson for the minister's office told said: "The case is back in the Federal court this week and this is a separate matter that takes its own course... This is going ahead, it's an important rollout for the country — it will take broadband from 90 percent, where it is now, to 99 percent. That's a massive jump and nothing is going to stop that happening."

Despite the conclusion of the deal, Telstra plans to press ahead with its case and is still considering further legal action.

A spokesperson for the telco said: "We have not started these proceedings contingent on the deal being signed or not. If we are successful and after reviewing the documents, we will be seeking an order to get the minister's decision revoked."