Federal Government cancels OPEL contract

The Federal government has cancelled the $958 million OPEL contract to provide wireless broadband to much of regional Australia.

The news was revealed in statements to the Australian Stock Exchange by Futuris (the owner of Elders) and SingTel.

Futuris' statement to says that the cancellation was due to the Department of  Broadband, Communication and the Digital Economy's assessment that the OPEL proposal "did not meet prescribed coverage requirements." The government's planned FTTN network, it says, would also have represented "a material risk of duplication."

SingTel's statement says that it believes all of the requirements OPEL was asked to meet were achieved.

The decision is a fillup for Telstra, which has long argued that OPEL and the WiMax technology it planned to use were both inappropriate choices for the deliver of regional broadband. The telco's Next G network is now the sole option for wireless broadband in much of Australia.

OPEL had promised to deliver broadband at metro-comparable prices within two years to regional areas. Whether the govenment's planned FTTN network can do so in a similar timeframe remains to be seen.