Kogan.com in a 'brilliant position' for NBN: Ruslan Kogan

Having never undertaken a large fixed-line infrastructure spend, Ruslan Kogan says his company is in a better position than most to offer 'incredibly attractive' services, especially with NBN currently focused on repairing customer experience issues.
Written by Corinne Reichert, Contributor

Kogan.com will be launching its National Broadband Network (NBN) service within a few months, with CEO and founder Ruslan Kogan telling ZDNet during CES 2018 that it will have "incredibly attractive" prices across all speed tiers.

The prep work for Kogan.com's NBN service -- which will launch off the back of Vodafone Australia's network access -- is currently in action, Kogan said.

"Most of the prep work is in Vodafone's court, so they are obviously launching an NBN service themselves which they're currently rolling out, and we're going to have parity of service with our product that will be through the Vodafone network, everything going through the same pipes," Kogan explained to ZDNet.

"There's a big focus on the customer service side of things, which our team's building at the moment, because one of the worst feedback areas about current NBN providers has been people don't know is it connected, when's it getting connected, who's coming when, what sort of service to get, what the speeds are; that element of the customer service our team is working on at the moment to ensure there's very clear communication and the marketing side of it is spot on."

According to Kogan, the online retailer is in a better position than Australia's major telcos in the NBN services market, because it has never had to bear the expenses of building out fixed-line infrastructure investment, only to have to move customers across to the NBN.

"We are in a brilliant position in that industry because ... you've got all these telcos that have fixed infrastructure that have had capital expenses building out networks over the last few decades -- all of that just becomes meaningless, and everyone gets to buy at the same price from NBN and it becomes a customer acquisition play: Who can acquire customers the cheapest," he told ZDNet.

"Our cost of acquisition is the cheapest, and we can pass that saving onto the customer. So we're very excited by this; it's basically a government-mandated switchover of a huge utility that people want, need, and are using more and more of, and we will have an incredibly competitive price on it."

Kogan also said his company is not worried about the high number of customer complaints and NBN's rollout issues, saying this was "expected" to occur in a government project.

"We obviously want to launch NBN as quickly as possible, but there is some advantage in the fact that they're working very hard at fixing a lot of the issues that have happened, and only a tiny portion of people are on NBN so far, and we're launching in a few months," he explained.

"We're probably launching at the perfect time, where a lot of those issues that are related to NBN itself will be sorted."

Kogan.com had announced in June last year that it would be launching NBN services sometime in 2018 with Vodafone, at the time saying they would also extend their agreement from October 2015 for mobile broadband services out to 2022, with "significant incentives" for both companies to continue the partnership thereafter.

"What we do in the way that we run our business is firstly we ensure parity of service with the partner, and then we do a lot of due diligence in evaluating how they operate," Kogan said at CES.

"We have a unique structure with Vodafone, where we are the branding, marketing, and customer acquisition arm. So Vodafone runs the service, Vodafone runs the network, the call centres, absolutely everything, and it's branded as Kogan mobile.

"The way that we've structured it makes a lot of sense, because for our business, we are doing what we are good at: Being the brand Kogan Mobile, the online trust, the customer acquisition, the digital marketing, and we can offer a Kogan-branded end-to-end experience for our customers whilst not -- we don't know how to run a telco."

See also: CES 2018 special coverage (CNET)

Vodafone had at the end of 2015 come to an agreement to wholesale its 3G mobile network to electronics manufacturer and retailer Kogan.com, adding 4G services to this in 2016.

Vodafone also signed a AU$900 million deal with TPG in the same year for Australia's number three fixed-line operator to build out an extra 4,000km of fibre to connect Vodafone's cell towers across Australia by mid-2018.

Vodafone then finally launched its own NBN service last month across Sydney, Canberra, Melbourne, Geelong, and Newcastle, with the provider saying its 4G backup service has now become automated.

"Because we've built our network and we have a small number of customers, customers generally got the speed experience that they were expecting," Vodafone's GM of Broadband Services Matthew Lobb told ZDNet last month.

"[But] there were customers that we needed to work on."

Vodafone unveiled its three NBN plans -- "essential" NBN 25, "essential plus" NBN 50, and "premium" NBN 100 on NBN's three main speed tiers -- in August.

Under Vodafone's home broadband pricing, it will cost consumers AU$70 per month for 12Mbps download speeds; AU$80 for 25Mbps; AU$95 for 50Mbps; and AU$110 for 100Mbps, with all options available in 24-month and month-to-month options.

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