Thursday, 25 March 2021 15:50

NBN pricing review 'inadequate' says Aussie Broadband boss Featured

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Aussie Broadband managing director Phillip Britt said he is disappointed by the proposals emerging from the NBN 2021 pricing review.

According to Britt, the proposals were "not even remotely close" to Aussie Broadband's hopes.

The key problem is that they do not reflect Australia's increasing demand for data.

"Due to the significant growth the industry has experienced in the last 12 months, and the fact that usage has not returned to pre-COVID levels, we believe that the proposed changes are wholly inadequate to support the needs of the RSP's and ultimately, Australian broadband users," said Britt.

By the time the proposals come into effect in May 2022, traffic would be significantly higher again, he predicted.

Citing ACCC figures, Aussie Broadband were not even remotely close to what the company is looking for. said the pre-COVID growth in average broadband usage was 16% year on year, accelerating to 27% in 2020.

"What we're seeing here at Aussie Broadband is actually 35% above industry usage, and as a result, this is putting even more pressure on our margins," said Britt.

Aussie Broadband's submission to NBN proposed a three-phase solution.

• Reinstate a COVID-19 style rebate to give RSPs the certainty and confidence to continue to facilitate growth in the market and promote high speed services to the benefit of all.

• Work towards increasing the bundled CVC allowance for high-speed tiers to further encourage RSPs to provide quality services to end users. Aussie Broadband believes NBN Co should include an allocation of 10Mbps of CVC per TC-4 high-speed bundle (100/20Mbps and up).

• Scrap CVC entirely and move to a single access charge based on the speed tier chosen, with no usage or CVC component, as is the practice in countries such as New Zealand.

While usage continues to rise and NBN keeps charging for bandwidth volume in the form of CVC, the only choice RSPs have is to raise prices or reduce service levels, said Britt.

This is a particular problem for companies such as Aussie Broadband that have made a selling point of having enough capacity at each POI to provide customers with good speeds during peak periods.

"The telco industry has effectively come off 12 months of not having to worry about CVC, other than network traffic during COVID," he said.

"The NBN proved during the pandemic that it completely supported the needs of both the industry and consumers, and we're looking for this support to continue. We believe this is in the interest of all Australians."


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Stephen Withers

Stephen Withers is one of Australia¹s most experienced IT journalists, having begun his career in the days of 8-bit 'microcomputers'. He covers the gamut from gadgets to enterprise systems. In previous lives he has been an academic, a systems programmer, an IT support manager, and an online services manager. Stephen holds an honours degree in Management Sciences and a PhD in Industrial and Business Studies.

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