Abstract

Australian telecommunications universal service policy has recently been extended to include the provision of basic data services within a contestable universal service framework. In view of this fundamental policy change, information about the demand for telecommunication services is critical if competition is to deliver intended outcomes. This analysis examines the demand for Internet in rural and remote communities in Western Australia. Toward this end econometric Internet subscription and use models are estimated on survey data collected for this purpose. Estimation results indicate price reduction will have a positive influence among existing Internet subscribers. A model of Internet subscription itself, however, suggests that demand for access is derivative of education and work requirements.

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