so no more dodo deal

Merger frenzy as ISPs flee bush
Andrew Colley | September 11, 2007
AS the federal Government trumpeted its $958 million bush broadband pact with the Opel
consortium on Sunday, the kingdom of regional micro-ISPs - suckled on spending of nearly
$500 million over three years - was quietly crumbling.
Dr Eric Heyde said many rural ISPs were starting to
hurt
The Government's decision to reject all but a few of the 30 applications for continued funding under the final
round of its rural broadband subsidy program has prompted a regional ISP fire sale.
Wireless internet providers Cirrus Communications and Broadband Anywhere said they were currently poised to
make multiple acquisitions after being approached by several companies seeking to quit the rural broadband
business.
Cirrus managing director Dr Eric Heyde said: "There are two (acquisitions) that are top of mind for me at the
moment, but I suspect there will be more." Cirrus is based in the NSW Central Coast.
Broadband Anywhere regional business development manager Rob Seymour said the South Australian ISP was
in a similar position.
"The short answer is yes and there are things happening," Mr Seymour said. "(I) just can't expand on that
comment at this time."
The ISPs in the companies' sights were formerly registered to receive subsidies for connecting customers to their
networks under the Government's long-running rural broadband infrastructure development scheme.
All but a few terrestrial providers and about seven satellite providers have been approved for the final phase of
the scheme, the $162.5 million Australian Broadband Guarantee, which runs until June next year.
The schemes will be followed by the Broadband Connect Infrastructure Program (BCIP), which was awarded to
Opel in June.
Regional ISPs were angered earlier this year when the Government tightened rules for entry to the program.
The Government said providers would be limited to one per area, and only in remote areas outside the BCIP's
coverage footprint.
Dr Heyde said many rural ISPs were starting to hurt.
Cirrus had cancelled plans to roll out new infrastructure to regional areas covering between 400,000 and
500,000 residents, Dr Heyde said.
"The funding is all about getting services to areas that are not commercially sustainable so, ipso facto, if you
want to build a commercially sustainable business and you can't get any government support, you can't go there
- and we won't," he said.