It's something I've been hearing about for a while - the NBN rolls into a neighbourhood and RSPs offer plans that are no better than what people had with ADSL or HFC... but they end up paying more. The practice has now come to the attention of the Australian Competition and Consumer Commission (ACCC) with the commission's boss saying the impact on low-income families is significant.
In a speech given at the CommsDay summit yesterday, ACCC Chair Rod Sims discussed the nature of these issues. He noted that while NBN Co's performance has measurably improved, "you don’t have to look far to find someone who has had a poor experience getting connected".
He noted the case of one of NBN's staff who had three appointments missed with no reason or warning given. And stories of poor performance with new NBN connections that are slower than the ADSL and HFC connections they replaced are also common.
One of the problems, said Sims, is that NBN Co has revised its wholesale providing structures. The wholesale cost of a 12Mbps service and 50Mbps service is very close and the gap is narrowing. And while some RSPs aren't offering 12Mbps plans at all as a result, established providers are charging a premium for slower services. Sims said:
To give one example, Optus increased its asking price for new customers acquiring an entry-level NBN plan to $80 per month — a $20 increase. Extraordinarily, this was $10 more expensive per month than its 50 megabit plan.
Through the speech, Sims noted that NBN Co's increased focus on enterprise services, changes in wholesale pricing structures, nuances in the way CVC (connectivity virtual circuit) is purchased by RSPs and service standards are all contributing to the death of low-cost connections. And while the average connection speed getting closer to 50Mbps looks good, it means customers who can least afford a price hike are getting slugged.
I've started shopping around as the NBN is being connected in my neighbourhood and it looks like a similar connection to what I have now will cost me between $10 and $20 extra per month. So, I'll be waiting to see what offers come when I step back from the table.
In any event, with low-tier NBN plans spiking in price, it makes sense to go with a faster plan, despite the added cost. Here's a look at how the leading providers price their Premium Evening Speed NBN 100 plans: