
Just over two years ago, I cancelled my NBN connection for 5G home internet and I haven't looked back. It's faster and cheaper than an equivalent NBN plan, and has proved very reliable. While I've been happy with 5G home internet, NBN Co's newly announced speed increases have me contemplating a wired connection again.
If the speed changes go through, NBN 100 plans will become five times faster with no change in wholesale price (for those with HFC or FTTP connections). That's an increase from 100Mbps to 500Mbps. NBN 250 and NBN 1000 plans will also get a bit faster, but it’s the NBN 100 plan change that has me excited.
Uncapped 5G plans are currently better value than an NBN 100 plan. I'm paying $85 per month and getting speeds as fast 500Mbps. For comparison, you're typically looking at $85 per month for an NBN 100 plan with typical evening speeds of 100Mbps (excluding promotional discounts).
Here's how NBN 100 plan pricing compares with uncapped 5G plans:
5G plans make some trade-offs in consistency, however. I can get speeds above 500Mbps on a good day, but sometimes they're as low as 200Mbps. 200Mbps is still a great internet speed, so for the price, this isn't an issue for me. But if an upgraded NBN 100 plan can give me 500Mbps most of the time, that becomes a no-brainer. Especially at the same price.
Price is the big question, however. NBN Co says wholesale pricing won't change for plans receiving a speed boost, but that doesn't mean prices won't change for customers like you and me. While price increases are never popular - and often cause customers to leave - a five times speed increase is the kind of thing that’s worth a couple more bucks per month on paper.
NBN providers also then have the responsibility of delivering those speeds. While capacity charges have been eliminated from NBN 100 plans and up, from are other contention points in the network. Users can still run into congestion due to a lack of network-to-network interface (NNI) capacity or backhaul capacity.
NNI is effectively the connection back to the NBN, whereas backhaul typically refers to the connection between a telco and the wider internet. To avoid congestion, a telco would need enough backhaul that matches the capacity they purchase on the NBN. Some telcos, like Aussie Broadband, own their own infrastructure, which allows them to cut down on this cost. Others need to purchase connectivity through a larger provider.
Backhaul is more affordable than what NBN used to charge for capacity, but more customers on faster plans could see providers need to invest a lot more. This, in turn, could increase prices for customers.
At the same time, providers offering 5G internet could drop their prices. There's a lot more margin in selling 5G wireless internet plans than there is NBN after all. If Telstra wants to cut my 5G home internet bill to $70 per month to better compete with the upcoming NBN speed boosts, I'd probably stay.
The NBN speed boosts sound great on paper. Making faster internet more widely available is a good thing! There are just so many variables that need to be considered over the coming months. And that's assuming they go ahead - this is still all just a proposal. But if NBN Co and the providers get it right, they'll have won back a customer.
Alex Choros
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