Number of NBN gigabit premises halves as network stuck on 25Mbps or less

The laws of mathematics and averages suggests that the National Broadband Network (NBN) should be regarded as a 30Mbps network for the purposes of assuming a standard user's bandwidth.

According to the Australian Competition and Consumer Commission's (ACCC) latest Wholesale Market Indicators Report, the trends established in previous releases -- over half the network being on 25/5Mbps plans and half of all customers using Telstra as their retail service provider (RSP) -- have continued out to September 30.

By speed tiers, only 13 premises now have the highest 1,000/400Mbps plan available, a drop from 30 premises last quarter; those on 500/200Mbps and 250/100Mbps remained similarly tiny, with only three and 65 premises, respectively; and 100/40Mbps saw 22,000 new additions across fibre-to-the-premises (FttP), fibre-to-the-basement (FttB), and fibre-to-the-node (FttN) technologies, and now represents 12 percent of the network.

The 50/20Mbps tier makes up 4 percent of the network, with just shy of 49,000 overall premises, and the 25/10Mbps tier is used by 9,786 premises.

By far the largest tier of users are on the lowest two available: 25/5Mbps makes up 54 percent of the network and saw 155,000 new users to take its total to 738,000; and 412,549 premises or 30 percent of the network are now opting for a 12/1Mbps plan, with the addition of 77,092 premises this quarter.

Broken down by RSP, Telstra is edging towards 50 percent of all users on fibre-based technologies. Even though the telco's percentage dropped on FttP and FttB technologies -- to 48 and 46 percent, respectively -- it increased its percentage in the fastest-growing segment, namely FttN customers, to 58 percent. Telstra's percentage of fixed-wireless customers remained a touch over 57 percent.

Behind Telstra was TPG, with 27 percent of the fibre-based customers, 16 percent of fixed-wireless premises, and 21 percent of interim satellite users, with Optus and Vocus as the third and fourth-placed RSPs.

ACCC Chairman Rod Sims pointed out that Telstra's dominance varies by geography.

"Telstra's market share of NBN access services in metropolitan areas is 43 percent, which is similar to its market share of traditional broadband technologies. In regional areas, where it has enjoyed much larger market shares, up to 90 percent in some areas, Telstra's market share of wholesale NBN access services is around 55 percent," Sims said.

The ACCC said the next quarterly report would see the addition of hybrid fibre-coaxial (HFC) and long-term satellite services.

NBN has come under sustained criticism for its connectivity virtual circuit (CVC) pricing, which many in the industry see as inflated and driving users to slower plans.

Last month, NBN forecast its CVC wholesale price would drop to AU$10 with increased usage of the network.

"We continue to consult with the industry on all of our product decisions. CVC is no different. Our CVC pricing has come down more than 20 percent over the past 20 months, from AU$20 in February 2015 to AU$15.75 now," NBN CEO Bill Morrow told Senate Estimates in October.

"Part of this reduction comes with an industry-average volume-based discount model, and we are now consulting on a discount model that moves this to an RSP-average -- allowing retailers to further differentiate their product offering and pass along lower price as end users demand more data.

"If all goes well, we hope to implement this change early in 2017. As data usage continues to increase over the network, we expect CVC pricing to drop further; in fact, with our forecasted usage, we see the CVC price approaching AU$10 a unit."

According to the ACCC, NBN is contracted to supply 1,535 gigabits per second of capacity, an increase of 300Gbps on last quarter.