With the Liberals, Greens and independent senator Nick Xenophon now voicing their opposition to the plan, the filtering scheme has little chance of passing through the Senate after the election.
But lobby group Electronic Frontiers Australia, which has been at the forefront of the campaign against the filter, says it will continue to pressure the Government until it drops the policy altogether.
"The legislation is pretty crook, but the idea isn't dead and we're not going to rest easy until Senator Conroy has admitted defeat," EFA spokesperson Colin Jacobs told SmartCompany this morning.
On Triple J radio yesterday, Hockey said the Coalition would refuse to support the internet filter "because we believe it's flawed policy".
"It's not going to capture a whole lot of images and chatter that we all find offensive (sic) that is going through email," he said.
Shortly afterwards, communications spokesperson Tony Smith told AAP that "a Coalition government will not introduce a mandatory ISP level filter. We will instead implement practical and effective measures to enhance online safety and security including PC-based filters for families."
"The Coalition did not implement a mandatory ISP level filter when we were last in government because it was not workable or effective and offered parents a false sense of security,'' he said.
The decision has been met with praise from rival political parties and activist groups. GetUp, which even promoted a petition against the filter with over 120,000 signatures, says the announcement proves its giant online campaign was successful.
"The decision belongs to the huge number of people who contributed to a tenacious, self-organised campaign that stretched from online civil libertarians all the way up to the US State Department," Greens communications spokesman Scott Ludlam also said in a statement.
The move comes after Conroy recently delayed the filter for another year in order to provide time for a 12-month long review of the Refused Classification system.
Content labelled as RC would be blocked under the scheme, with Conroy saying users shouldn't be able to access content on the internet that they wouldn't be able to access otherwise.
At the time, lobby groups said it was an example of Conroy backing down from his proposed plan after months of delays and technical squabbles.
In the meantime, ISPs Telstra, Optus and Primus, which cover about 70% of all Australian internet users, have volunteered to block a list of child abuse websites. Conroy has called on other ISPs to block these sites as well.
Legislation was to be introduced next year. Now, no matter who wins Government on August 21, it now looks as though the mandatory filtering plan won't be passed in its current form.
The EFA's spokesman, Colin Jacobs, says this is a welcome move which guarantees the current scheme won't be passed.
"This shows that Conroy has been pretty unsuccessful in convincing anyone outside his party that it's a policy that has any merit. We won't rest easy until the idea is dead, but for now, it looks as though it's going to fail on arrival in the Senate."
"The Coalition has said they're going to release their own policies about protection, but for now it looks as though the mandatory filtering proposal is off the table."
The filter has been a major point of controversy between the Government and the internet industry. Various lobby and technical groups have attempted to show the filter will dramatically slow internet speeds and actually block content that isn't inappropriate at all.
Those fears were realised when a leaked ACMA blacklist last year showed an innocent business was included on the list after its site was accidentally hacked.
Conroy has repeatedly said the filter is designed to block child pornography and other inappropriate content, but the Government also confirmed the proposal wouldn't force ISPs to go after users who purposefully go around the filter.
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