NBN Co's speed boost plan may hit bumps on competition, inclusion

Aussie Broadband says a proposal by NBN Co to significantly upgrade the speeds on its high-end plans could raise competition concerns and widen the digital divide.

The surprise proposal - which would see the 100/20Mbps tier become 500/50Mbps, and the current 250Mbps and up to gigabit tiers also upgraded - was aired in a consultation paper and industry webinar yesterday.

While there would be “no extra wholesale cost” charged by NBN Co, the wholesaler alluded to potentially increased backhaul requirements as well as customer premises equipment (CPE) replacement, which would come with costs.

Aussie Broadband’s group managing director Phillip Britt said in a statement that it is “still understanding the detail of NBN Co's speed proposal, but on the face of it could represent one of the most exciting steps in technology adoption for Australian households and businesses.”

In particular, Britt said, “We still need to understand what impacts this will have for competition.” 

“By switching customers over at the wholesale level, smaller RSPs may miss out on the opportunity to compete for those customers which could harm retail-side innovation in the Australian broadband market,” he said.

Additional questions asked by iTnews went unanswered.

Britt also said it was “essential…  that these announcements are paired with more investment in fixed broadband for regional Australians, so the digital inclusion gap isn't widened further.”

As raised by iTnews yesterday, the proposal, if approved, would mean the NBN tiering would move from 50/20Mbps to 500/50Mbps, with no in-between options unless retail providers customised a product out of the latter tier.

Currently, the largest share of NBN users is in the 50/20Mbps tier.

A spokesperson for TPG Telecom urged NBN Co to consider the needs of a larger percentage of its customer base when making changes.

“Enabling faster download speeds for NBN customers is a positive opportunity for those who can access it,” TPG Telecom’s spokesperson said.

“However, we must not overlook customers who cannot afford pricier, high-speed NBN plans, or the associated costs of upgrading equipment to take full advantage of these new speeds.

“If NBN Co was genuine about addressing affordability and high-speed access for all Australians, it would extend these benefits to the 70 percent of NBN customers on its entry-level 12, 25, and 50Mbps plans.

“In this cost-of-living crisis, it would be disappointing if only those with the financial means to access high-speed NBN plans reaped the benefits of these upgrades.”

Telstra and Optus were more welcoming of NBN Co’s proposal.

“We are always supportive of any initiative that provides an improved experience for our customers,” a Telstra spokesperson said.

“We look forward to further discussions with NBN Co during the consultation period as we assess the impact on Telstra and our customers.”

Meanwhile, Optus vice president of government and regulatory affairs Mike Sheridan said the proposal “is something Optus has long called for and is consistent with our focus on improving the connectivity experience for all Australians in this rapidly evolving digital world.”

“We look forward to working with [NBN Co] to understand how these higher speed tiers can be delivered to all households.”