Kogan.com launching NBN services with Vodafone

Kogan.com has extended its mobile partnership with Vodafone out to 2022, adding fixed-line services across the NBN as of 2018 into the mix.
Written by Corinne Reichert, Contributor

Kogan.com has announced signing an agreement with Vodafone Australia to use the latter's network to launch National Broadband Network (NBN) services in 2018.

The partnership also extends the two companies' agreement from October 2015 for mobile broadband services out to 2022, with "significant incentives" for both companies to continue the partnership thereafter, Kogan.com said.

According to the company, the agreements will see Kogan.com commence offering "competitively priced mobile broadband plans and NBN plans on the Vodafone fixed-line NBN network".

Under the NBN agreement, Vodafone will provide its network and customer support services to Kogan customers, in addition to "marketing incentives for the launch of the Kogan fixed-line services".

"Vodafone has been investing heavily to establish its own NBN infrastructure, and is set to roll out its capability over the coming year," Kogan.com executive director David Shafer said.

"The launch of NBN services is a major opportunity for Kogan.com. With a brand that has built a reputation for price leadership through digital efficiency, a huge online audience, and a data-driven and analytical culture, Kogan.com is well poised to offer and grow a market-leading NBN service."

Kogan Mobile contributed 4.2 percent of Kogan.com's gross profit for the six months to December 31, with Kogan Mobile's gross profit increasing by 50 percent quarter on quarter, the company added.

Kogan.com's net profit for the six-month period was AU$1.5 million, with earnings before interest, tax, depreciation, and amortisation (EBITDA) of AU$7.3 million on revenue of AU$143.9 million, up from the AU$104.7 million reported during the previous financial year.

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 last year.

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 put out a call for expressions of interest from customers and potential customers for NBN services last month, saying it would be launching "later this year" for homes and small businesses "in selected areas".

While Vodafone said that the information will not be used to inform its planning process, or where its NBN connectivity will be provided or switched on first, the EOI form asks for consumers' street address, suburb, state, postcode, current broadband provider, and whether they would be using the connection for personal or business use.

Vodafone said it will use the details of those who submit an EOI form to contact them about when and where the network will be offered.

Vodafone announced in October last year that it would be entering the NBN market as a retail service provider before the end of 2017, with CEO Inaki Berroeta saying the telco intends to be "the cornerstone of competition" in fixed-line broadband.

While Vodafone has not yet announced what speeds, data, and pricing it will offer in its NBN plans, it recently said that lower-speed tiers such as 12Mbps and 25Mbps should not even be offered on the NBN, and that NBN needs to make "urgent changes" to its wholesale pricing structure.

"Given taxpayers have funded a network which has been dimensioned to deliver speeds significantly faster than DSL, it is not clear that these low-speed tiers should even be on offer," Vodafone argued in its submission to the Joint Standing Committee on the NBN.

"The industry is not currently incentivised to deliver the full potential benefits of the NBN ... the pricing model discourages RSPs from offering higher-speed data plans."

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