The Federal Government has directed the Australian Communications Authority (ACA) to cancel the May 21 auction of datacasting transmitter licences.
The Minister for Communications, Information Technology and the Arts, Senator Richard Alston said he consulted with the three applicants (Barwix, ntl and Australian Datacasting Group), and considered the submissions from them before reaching his decision.
The decision to cancel the auction was based on a number of issues including a lack of competitive tension, which would mean the Federal Government would be unlikely to fetch a good price for the datacasting licences.
The auction was also likely to result in limited services for consumers, with at least five markets with only one service provider.
Alston said the licences were originally intended to be valid for 10 years, with an option to renew for a further five years, but he was concerned this could limit the potential for technological upgrade.