NBN providing telcos with additional capacity in response to COVID-19

Alex Choros - Managing Editor + Group Telco Editor

Last updated 19 March 2020

NBN Co has responded to the coronavirus pandemic by offering telcos additional capacity on the National Broadband Network at no extra cost. Charges will be waived for additional capacity of up to 40% for at least three months in attempt to mitigate congestion with more Australians working from home.

NBN Co's capacity-based pricing model is the main reason customers experience congestion on the network. All telcos selling an NBN plan also need to purchase capacity, or CVC.

Telcos typically have to find the right balance between how much CVC they purchase and the price they charge for the plan. Purchase too little CVC, and you get congestion during peak hours. Purchase too much, and plans become too expensive.

However, the definition of peak hours is very likely to expand due to more Australians staying home because of COVID-19, which would in turn create the potential for congestion. NBN Co has already seen a 5% or so increase in usage over the last few days. Superloop says it has seen new traffic records each day.

While NBN Co CEO Stephen Rue says there has yet to be significant congestion, the additional capacity measure is based on increased requirements observed around the world.

"We are closely following events unfolding in other parts of the world and we have taken decisive action to incrementally offer pricing relief for up to 40 per cent more capacity," said Rue. "This is equivalent to the higher end of increased data bandwidth requirements that we have seen in countries such as Italy, which have mandated work from home arrangements."

"The additional capacity pricing relief will be offered to RSPs at no additional cost and will help support significantly greater data use on the network throughout the day and during peak evening times."

The initial response to NBN Co's move has been positive, with Aussie Broadband welcoming the measures.

"It’s great to see NBN supporting the industry and the community if the demand for bandwidth spikes upwards during this crisis," said Aussie Broadband Managing Director Phil Britt.

"Currently, we’re not seeing the need right at this instant for an extra 40% of bandwidth, but if it does rise, it gives us and other telcos peace of mind that we can deal with it without incurring extra costs."

"I think this gives the industry some breathing space to allow us to focus on other critical issues, like providing customer service when call centre staff have to work from home."

A number of telcos, including Aussie Broadband, Telstra, and Optus, have announced measures to assist customers as a response to the pandemic. You can read more about this 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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