NBN cuts entry-level broadband prices, nixes differential pricing for video


NBN Co has detailed a price cut for entry-level broadband services that could make it more economical for retail service providers (RSPs) to offer ADSL-equivalent plans.

The company said it planned to shave at least $16.80 off the additional monthly charge levied on entry-level services once an extremely low usage threshold is passed.

NBN Co in June launched an industry consultation on its wholesale broadband pricing, with the company indicating it wanted to encourage the take-up of higher speed services as well as make NBN services more attractive to low-income households.

The company today revealed it had launched a second round of consultation, with NBN Co indicating it would move to quickly cut the wholesale pricing of low-end broadband services.

The company has a complex pricing structure for its entry-level 12Mbps services. A basic service with 150Kbps of included capacity has an effective wholesale price of $22.50. That can be used to serve households that are only interested in voice services or that have very low data needs.




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NBN not worth the money it cost to build it, Vocus chief executive says


Consumers are paying the price for government rules designed to protect NBN Co’s monopoly and help ensure it recovers the cost of building its network, Vocus Group chief executive Kevin Russell has argued.

“The real market value of the NBN is far, far less than what it cost to build,” the CEO said today. NBN Co’s decision-making “is driven as a monopoly targeting financial returns, rather than consumer needs and market reality.”

In remarks prepared for the ACCANect conference of the Australian Communications Consumer Action Network, the Vocus CEO said that because NBN Co’s financial targets are based on recovering the network’s build cost, “prices are far higher than would be achievable in a market-led environment.”

The Vocus chief executive took aim at NBN Co both over its prices and its approach to wholesale pricing.

In the ADSL era, the prices charged by Dodo, which is owned by Vocus, consistently trended downwards, he said. “This is in stark contrast to Dodo’s NBN plans, where all we have done is continually put prices up, to cover NBN’s increasing wholesale costs,” the CEO said.




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Optus CEO details ‘NBN champion’ program to combat migration woes


Optus says it is working to improve the experience of migrating to the NBN, with the telco’s CEO, Allen Lew, today revealing details of an initiative to smooth the transition to the new network.

In notes prepared for an address to ACCANect, the conference of the Australian Communications Consumer Action Network (ACCAN), Lew revealed that the telco has invested “tens of millions of dollars” in the “Optus NBN champion” program.

The program is designed to address a range of frustrations encountered by customers during the migration to the NBN. Those include confusion caused by the hand-off between sub-contractors, NBN Co and retail service providers (RSPs), struggles with installation and chasing answers to questions, lengthy activation processes, and a lack of visibility of the process for customers.

“We are proactively reaching out to existing customers who are migrating to the NBN to reassure them that one person will manage their order from receipt right through to completion and for the first 30 days of activation,” Lew said.

“This isn’t a promise to do; we have been embedding this since May and slowly building scale so that we can offer it to all our customers.”




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Telstra CEO expresses ‘surprise’ at NBN Co moving on enterprise market


NBN Co seeking to grow its share of the enterprise networking market is a “little bit of a surprise” for Telstra, the telco’s CEO Andy Penn says.

Addressing media during a briefing at the telco’s enterprise conference, Telstra Vantage, Penn said that it was particularly surprising because the rollout of the NBN was “slowing down” as it enters its final stages while NBN Co was simultaneously “diverting capital into building more fibre in CBDs”.

“Effectively what it means at a practical level is capital is being diverted from rolling out the core purpose of the NBN to this, so that’s a surprise,” Penn said.

“I had understood the purpose of the NBN was to provide broadband connectivity to every household in Australia not to build fibre for enterprise customers,” the CEO said, adding that “lots of telcos” already have fibre throughout CBDs.

NBN Co has indicated it intends to eventually grow its revenue from businesses to $1 billion a year. Last month it revealed that its FY19 revenue from the business segment had grown 54 per cent year-on-year.




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Telstra revises forecasts for third year running after changes to NBN plan


Changes made by NBN Co to the timing of the National Broadband Network mean that Telstra for the third year in a row has had to revise its financial forecasts.

NBN Co last week released an updated corporate plan that revealed changes to its activation targets for FY20.

“Given the current priority on network optimisation and the degree of civil build required for FTTC [fibre to the curb], there has been a shift in phasing during FY20 for the deployment and activations,” the updated document states. “This extended the end point for the respective 18-month migration periods for some customers beyond the previously forecast timing.” (Once an area is declared ready for service by NBN Co, households have 18 months to migrate from the copper network to the NBN.)

NBN Co cut by 500,000 to 1.5 million the number of premises it expects to be connected in FY20. The company said it expects to connect 8.1 million premises by 30 June 2021, which is around six months later than it previously expected.

“Telstra’s FY20 guidance provided to the market on 15 August 2019 was predicated on NBN Co’s previous Corporate Plan 2019 and assumed the nbn rollout and migration in FY20 would be broadly in accordance with the 2019 plan,” Telstra said in a statement released to the ASX.




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NBN Co expects to be cash-flow positive a year later than previously forecast


NBN Co now expects it won’t be cash-flow positive until FY23, a year later than projections released last year by the company.

The company expects to be cash-flow negative to the tune of $200 million in FY22; previously it projected positive cash flow of $100 million. It is forecasting cash flow of $700 million in FY23.

The company today also confirmed it will need to continue hooking up premises to the National Broadband Network beyond the official build completion date of 30 June 2020.

NBN Co said it was “on schedule and on budget to complete construction” but confirmed that it expected construction to continue to connect newly built homes and around 100,000 premises classed as “complex connections”

“Next year we will complete the build as we add another 1.5 million homes and businesses to the ready to connect footprint,” CEO Stephen Rue said today. “And while we are signposting this as the completion date, naturally construction activities will continue into the future as new homes and houses are added to the nation’s stock.




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Verizon to offer NBN business services


Verizon has struck a deal that will see the company selling NBN Co’s Enterprise Ethernet service to Australian businesses.

The company said it would offer a suite of its services, including software defined networking (SDN) and virtual network services (VNS), over business-grade NBN connections.

“A robust network is the backbone of any business, and particularly today, where digital business is the norm, and organisations are increasingly looking for scalable, flexible network capacity to support global growth,” said Robert Le Busque, Verizon’s regional managing director for Australia, New Zealand and India.

“Verizon is pleased to be able to present a compelling alternative to Australian enterprise and government businesses.”

NBN Co in October 2018 launched its Enterprise Ethernet offering, which is its flagship product for the business market.

In its full year results, released earlier this month, NBN Co revealed that in FY19 its revenue from the business segment hit $388 million, up 54 per cent on the prior year. The company is hoping to grow that to $1 billion.

In early August, Australia Post revealed that NBN Co’s fixed line infrastructure would play a key role in upgrading telecommunications capabilities at some 4000 of its facilities.

Supermarket chain Coles is also a major enterprise that is relying on NBN fibre, courtesy of a deal with Optus.

In June, Macquarie Telecom announced a suite of business-class NBN services.

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