NBN announces new fixed-wireless pricing

NBN's existing fixed-wireless users will be charged AU$45 for bundled 50/20Mbps services, while new users will pay AU$65 per month, with the new wholesale pricing coming in on August 20.
Written by Corinne Reichert, Contributor

The National Broadband Network (NBN) company has announced its new fixed-wireless wholesale pricing following consultation with industry, with existing users to pay AU$45 per month for 50/20Mbps services.

Speaking to the Joint Standing Committee on the National Broadband Network during a hearing on its inquiry into the rollout of the NBN in rural and regional areas on Wednesday night, NBN CFO Stephen Rue said the new bundled pricing would come in on August 20.

"We've listened to feedback throughout the consultation and have kept the bundled price of the 50 megabits per second product at AU$45 for existing users," Rue said.

"These new wholesale bundle discounts will provide RSPs with added flexibility and choice to package and price their retail plans for homes and businesses. Similar to NBN's fixed-line pricing, the fixed-wireless bundled discounts access and an associated amount of bandwidth for a single effective discounted charge for internet providers."

New customers will be charged at AU$65 for the 50/20Mbps service; however, Rue said "I don't think that is forever".

The CFO added that NBN is continuing to consult with retail service providers over the next few months on "new product ideas to better reflect user demand on the fixed-wireless network", as well as ensuring it delivers a consistent service on the network.

In regards to NBN's decision to kill its plans to offer 100Mbps fixed-wireless, Rue said the decision was about user experience in addition to the funding involved.

"If we were to maintain a user experience for existing customers on the fixed-wireless network, it would have required us to spend much more capital on the fixed-wireless network; it's related to the experience of existing users," he explained.

According to NBN's "high-level analysis" of the product, it would have cost "a lot of money ... hundreds of millions of dollars", he added.

NBN had in May said it would be overhauling its wholesale fixed-wireless pricing, kicking off consultation with retail service providers on pricing bundles at the time.

According to a blog post by NBN executive general manager of Wholesale Products Tom Roets, there could be a "potential divide" by not offering similar bundles available across its fixed-line offerings.

"The aim would be for the fixed access and bandwidth price options to remove the requirement to retain separate charges for providers to support fixed-wireless services under our existing two-part price construct and improve the economies of scale for fixed wireless from internet and phone providers," Roets said at the time.

"We aim to have this wholesale pricing option available to providers by the end of September 2018."

Last month, NBN additionally amended its network design rules to reduce the number of premises able to connect to each fixed-wireless cell, as well as updating the maximum bandwidth capacity available.

The new rules provided to the Australian Competition and Consumer Commission (ACCC) at the end of June will see maximum bandwidth move from 900Mbps to 4Gbps, and maximum connected premises per sector be capped at 56.

The largest wireless serving areas will have up to 24 wireless serving area modules connected to a FAN, while the maximum number of end users in an access aggregation region is 25,000.

The changes followed criticisms about congestion on the fixed-wireless network, with CEO Bill Morrow in June telling the joint standing committee that the company is considering implementing a Fair Use policy capping download allowances for "extreme" or "super" users.

"Our average consumption across the NBN network is just under 200 gigabytes per month, and when you look at the fixed-wireless network it's substantially less than that, so these aren't as heavy of users; however, in the fixed-wireless there's a large portion that are using terabytes of data," the outgoing CEO explained.

"One of the things that we're evaluating ... [is] a form of Fair Use policy to say we would groom these extreme users ... the grooming could be that during the busy period of the day, when these heavy users are impacting the majority, that they actually get throttled back to where they are taking down whatever everybody else is taking down, and during the non-congested or busy periods, they're free to go for as much data as they want to pull down."

According to Morrow, there's enough extreme usage happening that there would be a "substantial lift" in peak speeds for other fixed-wireless users if NBN did groom the super users, which he described as being "gamers predominantly".

Morrow further claimed that the 100Mbps fixed-wireless product was always more aimed at businesses than residential users, arguing that it was killed off because it could cost AU$1 billion to offer, due to requiring additional towers, backhaul, and spectrum.

NBN in May revealed in response to Senate Estimates Questions on Notice that it is targeting fixed-wireless congestion at priority cells where speeds are less than 3Mbps during peak periods, with nine towers targeted at the end of November.

In June, the ACCC told the same joint standing committee that it would need an additional AU$6 million to extend its speed-monitoring program to fixed-wireless services.

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