Internet service providers are promising they will spend more money to ensure higher speeds for customers using the National Broadband Network, but it remains unclear how much difference that will actually make.
Users of the high-speed network have become increasingly vocal about congestion problems, especially during evening periods when thousands of people are watching streaming services like Netflix. That problem can occur even if customers are paying extra for one of the faster speed tiers the NBN provides.
The Australian Competition and Consumer Commission has ordered providers to start promoting more realistic speeds in their advertising, specifying evening peak speeds rather than quoting the theoretical maximum speed, which is hardly ever achieved.
Many factors can influence the speed of individual connections, and some are the responsibility of customers, including the placement of their Wi-Fi routers and the condition of wiring within their home. However, one factor which providers can control is the amount of Connectivity Virtual Circuit (CVC) they buy. In simple terms, the bulk network capacity they purchase and then share amongst all their customers.
Providers have tended to skimp on CVC, purchasing as little as they can get away with in order to minimise their own costs. On wired NBN connections, the average contention ratio across all providers is about 1:30, meaning that ISPs are assuming that only 1 in 30 customers will be connected at any given time.
Network builder NBN Co adjusted CVC pricing earlier this year making bulk purchases cheaper for ISPs. CEO Bill Morrow said during the company's annual results announcement earlier this month that CVC purchases had begun rising as a result of the change, though he has flagged the possibility of further adjustments.
The major telcos have said they will be buying more CVC. Telstra predicts it will double its spend on CVC. "Fixed broadband usage is increasing, so that means we have to increase CVC and we intend to do that," Vodafone general manager of broadband Matthew Lobb said when Vodafone launched its NBN plans last week.
While extra capacity would be welcome, actually avoiding congestion is likely to remain a problem for consumers. Even if Telstra doubles its spend, that implies a typical contention ratio of 1:15, which means sluggishness is still going to affect some people. Even for customers of the same provider, congestion levels may vary depending on where they are located.
The most practical step consumers can take is to avoid signing up for long-term NBN plans, and carefully comparing what's on offer. Congestion can vary markedly between providers, so if you end up with an atrocious service, it's handy being able to switch without being tied to a 24-month deal.
Finding it difficult to make sense of providers' broadband speed promises? You're not alone in Australia, and the ACCC has promised to help.
Angus Kidman is editor-in-chief for comparison site finder.com.au and a former editor for Lifehacker Australia.