Recently, the National Library of Australia opened up Australian Newspapers Beta to the public, free of charge (though whether free as in speech or free as in beer is unclear). This is part of the Australian Newspapers Digitisation Program and promises to be a fantastic resource. They are digitising newspapers from every state from 1803 (when the first newspaper was published in Australia -- see above) through to 1954 (after which everything is still under copyright). Both images and text are available, and it's very easy to zero in on particular articles of interest, by date, newspaper, category, state or keyword search. Indeed, the interface is very attractive. The articles can be downloaded as JPG or PDF (though whole pages can only be saved as the latter, for some reason). Bearing in mind that this is only a beta, there are some problems. Coverage is very limited (most of the First World War is available, for example, but only the end of the Second), and the OCRing looks pretty dodgy from what I've seen. But this is where it gets clever: users can correct the mistakes made by the OCR software, either anonymously (verifying sapience by way of captcha) or by signing up for an account. They can also leave comments on individual articles or tag them. Well done, that library.
Web 2.0 seems to be something Antipodean institutions are latching onto fast. The NLA is very up-to-date: it also runs Picture Australia, which aggregates a number of image archives and hooks into Flickr. The Powerhouse Museum in Sydney is also a bit of a web 2.0, well, powerhouse. The Australian War Memorial is not quite as advanced, perhaps, but it blogs, and I think there are things happening behind the scenes. And as I've previously noted, New Zealand has long been digitising its newspaper archives, with completely free access. It seems like comparable British institutions aren't embracing web 2.0 in the same way -- the British Library, the British Museum, the Imperial War Museum are all looking pretty staid in comparison. I'd love to be proven wrong though!