<div><p>Australia announced a 43 billion dollar (US$30 billion) national broadband network Tuesday, in what Prime Minister Kevin Rudd described as the biggest infrastructure project in the country's history.</p><p>Rudd surprised the market by scrapping a tender process for private firms to build a network worth 10-15 billion dollars, instead opting for a more ambitious proposal with the government retaining control.</p><p>Labelling Australia a "broadband backwater," Rudd said the government understood the importance a national network would play in "turbo-charging Australia's economic future."</p><p>"Just as railway tracks laid out the future of the 19th century and electricity grids the future of the 20th century, so broadband represents the core infrastructure of the 21st century," he said.</p><p>"Slow broadband is holding our national economy back."</p><p>Providing a fast, affordable broadband network was a major campaign promise when Rudd's centre-left Labor government was elected in November 2007.</p><p>It had been considering tenders from private companies including Singapore-owned Optus and Canada's Axia NetMedia for a so-called fibre-to-the-node network offering speeds of up to 12 megabits per second.</p><p>But Rudd said a government-commissioned panel of experts had recommended scrapping the process.</p><p>"None of the national proposals offered value for money to the Australian taxpayer," the prime minister said.</p><p>Rudd said the government would instead form a company, in partnership with the private sector, that would build a more advanced fibre-to-the-home network offering speeds of up to 100 megabits per second.</p><p>Ninety percent of Australian homes and businesses would be able to receive the new, faster connection, with the rest of the country receiving a connection at 12 megabits per second.</p><p>Under the new plan, the government will initially invest 4.7 billion dollars, with the overall investment from government and the private sector reaching up to 43 billion dollars over eight years.</p><p>Rudd described the project as "the single largest nation-building infrastructure project in Australia's history."</p><p>He said construction would begin early next year and the government would sell its stake in the broadband company five years after the network was up and running.</p><p>Australia's largest telecoms firm Telstra was excluded from the initial tender after failing to meet with government criteria but Communications Minister Stephen Conroy said it would be invited to take part in the new project.</p><p>Analysts had previously questioned whether a national broadband network could be set up without Telstra, a former government monopoly that was privatised under the previous conservative government.</p><p>But in a move that could have far-reaching implications for Telstra, the government also said it was considering a major regulatory shake-up in the telecoms industry.</p><p>It said one of the options being considering was "functional separation" of Telstra.</p><p>That would involve limiting contact between Telstra's wholesale arm, which owns most of Australia's telecoms infrastructure, and the retail arm, which competes with other firms to sell products to consumers.</p><p>Telstra's rivals have long complained about difficulties gaining access to the firm's infrastructure networks.</p><p>Telstra shares rose 4.4 percent to 3.35 dollars shortly after trading began on the Australian stock exchange, while Optus-owner Singapore Telecommunications was up 1.3 percent at 2.31.</p><img src="http://admatch-syndication.mochila.com/images/ad.gif?aid=47095706&bid=informcom" /></div><div id="copyright"><div>

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