Telcos purchase more NBN capacity

RSPs take advantage of NBN pricing changes

New figures released by the Australian Competition and Consumer Commission reveal a jump in the National Broadband Network capacity for end users being purchased by retail service providers (RSP).

The ACCC releases a quarterly statistical snapshot of the state of the NBN wholesale market. The latest report, covering the three months to 31 December, reveals that the capacity per end user climbed from 1.11 megabits per second in the prior quarter to 1.53Mbps by the end of 2017.

In total, telcos were purchasing almost 5287Gbps of Traffic Class 4 capacity (the NBN traffic class used for standard Internet services) as of the end of December. That compares to around 3364Gbps at the end of September 2017.

In the same period, NBN services grew from around 2,757,000 fixed line and 203,000 fixed wireless services to 3,168,000 fixed line and 216,000 fixed wireless services.

The ACCC noted that the growth in Connectivity Virtual Circuit purchased by RSPs coincided with NBN’s move in December to offer a transitional wholesale discount as prepared to release new products that combined access and capacity charges.

NBN implemented a temporary credit offer for acquiring 50 per cent more CVC per user and also discounted the access charge for its 50Mbps product.

The growth in capacity per user also follows a crackdown by ACCC that has seen Telstra, Optus, and TPG agree to refund customers who paid for NBN services with unachievable speeds. The competition and consumer watchdog has also pushed RSPs to rejig their NBN marketing campaigns to change how they advertise speeds.

“We are pleased to see such a large jump in the CVC acquired by retailers from NBN Co this quarter,” ACCC chairperson Rod Sims said in a statement.

“With this level of CVC consumers will have faster broadband speeds and hopefully less congestion during peak evening periods.

“NBN Co’s response to retailers’ concerns about CVC pricing seems to have had an impact on the amount of CVC being acquired which we believe will benefit consumers through better quality broadband.”

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