NBN 100 plans could be getting cheaper from January

Alex Choros - Managing Editor + Group Telco Editor

Last updated 26 November 2019

NBN Co today announced that it will drop the wholesale price of NBN 100 plans from the start of the new year, ahead of the introduction of a new, cheaper NBN 100 plan with slower upload speeds in May. This will effectively drop the wholesale price of NBN 100 plans by $7 per month.

At this stage it's unclear whether providers will pass the discount on to consumers by offeiring cheaper plans, or whether they will pocket the savings for themselves.

Current NBN 100 plans, also known as Premium speed plans, have upload speeds of 40Mbps (NBN 100 / 40). However the new the NBN 100 plans being introduced will have upload speeds of 20Mbps (NBN 100 / 20). Both plans still have a maximum download speed of 100Mbps.

Download speed refers to how quickly you're able to get files from the internet, while upload speed relates to how fast you're able to send files to other places online. For example, upload speeds determine how long it will take to send an email with a large attachment, back up your photos to Google Drive, or plonk a big document on Dropbox.

Upload speeds can also affect video calls, Voice over IP, and gaming, as these activities all involve sending and receiving data.

NBN providers will have the choice to offer both NBN 100 / 40 and NBN 100 / 20 as plans to consumers, but it remains to seen what this will look like in the market. In the past, NBN Co has suggested that NBN 100 / 40 plans might be targeted at businesses, but this decision will ultimately be left to providers.

In addition, NBN Co will be introducing two new wholesale speed tiers in May: NBN 250 / 25, and NBN 1000 / 50. These plans will have theoretical download speeds of up to 250Mbps and 1,000Mbps, respectively. However, while the availability of faster speeds on the NBN is undoubtedly good news, only between 31% - 54% of Australian premises have NBN connections that are physically capable of achieving those speeds.

NBN customers with Fibre to the Premises (FTTP) and Fibre to the Curb (FTTC) will be able to enjoy the full benefits of NBN 250 or NBN 1,000, as well as some NBN customers with HFC. The rest of Australians who are on Fibre to the Node (FTTN), Fibre to the Building (FTTB), Fixed Wireless or Satellite NBN connections will simply miss out, unless the network is upgraded in the future.

In addition, NBN Co will allow providers to purchase CVC on a national level. In short, CVC is the amount of capacity a provider has access to on the NBN. To make an NBN plan affordable, telcos have to find the right balance between how much CVC they buy and how much they charge customers to access it. If providers purchase too little, their customers will experience congestion during peak hours. If they purchase too much, they won't make money selling NBN plans or be able to keep them priced competitively.

At present, providers have to purchase CVC for each Point of Interconnect (POI) they serve. A POI connects the NBN to the wider internet. There are 121 POIs around Australia. By removing the need to purchase capacity for each of these, NBN providers should find it easier to reduce congestion. The change will allow capacity to be allocated from a single pool, rather than 121 smaller pools.

Read more about NBN speeds here.

Alex Choros

Managing Editor + Group Telco Editor | X | Instagram | Threads | LinkedIn

Alex Choros is the Managing Editor of WhistleOut Australia and an award-winning journalist. He's been writing about consumer technology for over a decade and is an expert on the Australian telco sector, to the point where he knows far too many phone and internet plans by heart. In addition to leading the WhistleOut editorial team, Alex is responsible for ruining the office Sonos with his troubled taste in music.

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