NBN Discounts Did the Job to Get People on Board – Now What?

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High traffic on the National Broadband Network (NDN) has started to tick up as NBN Co’s ‘Focus on 50’ price promotion ending. The cheaper wholesale prices have garnered more than 2.1 million homes connected to higher speed plans and overall speeds during peak times picking up as well.

The company is now saying it is working with telecommunications companies to guarantee there is no slowdown throughout the busiest ­periods.

NBN Co. cut its prices in December 2017 in an attempt to get more retail service providers to push an increasing number of homes into higher-speed NBN offers, especially the 50 megabits per second download and 20Mbps upload (50/20) speed plan.

The discounting saw the company cut the monthly access price (AVC) of its 50/20 plan from $34 to $27 and offer a 50 per cent discount on the connectivity virtual circuit price (CVC). The CVC is the price retail service providers pay to move data from the NBN to their networks. The amount of CVC a retail provider buys affects the internet speed, particularly at peak usage times from 7pm to 11pm.

Unfortunately, congestion on the network has steadily risen so that peak-time averages have moved up from 12 minutes per service a week in April to just over an hour in August.

In a quote obtained via The Australian, NBN Co executive general manager of wholesale products Tom Roets said, “while there were record low levels of bandwidth congestion experienced on the network ear­l­ier this year, we do expect these levels to fluctuate as our promotional discount ends and as we help service providers adopt our new wholesale discount bundles”.

However, he went on to say NBN Co had not only put resources in place to help make the migration as smooth as possible for the telcos but the new wholesale bundles had enough CVC built into them for consumers not to be affected.

“We have seen the average network bandwidth congestion per week, per customer, across the network reduce from almost five hours a year ago to just above one hour in August 2018,” he said “To put that in perspective, a year ago customers with services that had heavy bandwidth congestion could have experienced regular buffering and dropouts, compared to customers with minimal congestion who may have only experienced occasional buffering during the busy evening periods.”

Under the new bundles, NBN Co charges telcos $45 a month a customer for a 50Mbps wholesale service, with 2Mbps of CVC ­included, and $65 a month for a 100Mbps wholesale service, which includes 2.5Mbps of CVC.

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