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ISP Aussie Broadband blames own industry for NBN woes

NBN Co’s chief executive Bill Morrow has admitted a 15 per cent dissatisfaction rate among newly connected users. An internet service provider has broken ranks to blame its own industry for the slow download speeds[1] being suffered by many customers of the National Broadband Network, as the Government calls in its watchdog to get to the bottom of a spike in complaints[2] about the service. “I suspect we’ll be one of the few ISPs to agree with Bill Morrow,” said Aussie Broadband managing director Phil Britt, referring to the NBN chief executive’s blog last Monday[3] blaming a “land grab” by retailers for the unsuitable service many customers had ended up with.

“It is entirely possible to provide decent speeds to customers at the current wholesale prices that the NBN charges.” After NBN Co admitted a 15 per cent dissatisfaction rate[4] among newly connected users, a government fearing electoral backlash this week asked[5] the Australian Communications & Media Authority to interview NBN customers about their experience.

It was all so much better then: Signing agreements for NBN Co then Telstra Chief, David Thodey (left), Minister for ... It was all so much better then: Signing agreements for NBN Co then Telstra Chief, David Thodey (left), Minister for communications Malcolm Turnbull, and Bill Morrow chief of the NBN Co today. December 14, 2014. Michele Mossop

The probe will also compel data on, among other things, fault handling from 21 players in the NBN ecosystem.

Despite that specific number, nobody would specify to The Australian Financial Review who the 21 will be – however Mr Britt indicated Optus would be worth grilling. He has previously blasted[6] the number two telco for what he alleges was poor management of network congestion when Aussie Broadband used Optus’s “backhaul” – the network that internet retailers plug in to NBN’s fibre – at 110 of the 121 NBN “points of interconnect” (POIs) around Australia. The small ISP has since invested heavily in leasing its own dedicated backhaul on Telstra’s network, with 118 POIs now active.

Mr Britt said Aussie Broadband could now control how much bandwidth it provisioned and pursue its niche of a mid-priced, high-reliability offering. He said a hallmark of the “land grab” outlined by Mr Morrow was the “unlimited data” plans now flooding the NBN retail market, offered by Optus among others. “It takes careful and flexible network management, and policies like no unlimited plans, to ensure that we manage the network to avoid congestion,” he said.

Here in what sense?
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pNBN Co admitted a 15 per cent dissatisfaction rate among newly connected users Here in what sense? NBN Co admitted a 15 per cent dissatisfaction rate among newly connected users Adam Turner

‘We have made a number of improvements’

Optus said it was “disappointed that Aussie Broadband did not have an optimal experience.

We have made a number of improvements to our NBN service and capacity.” The availability of lower NBN access charges for accounts with lower speeds was a flaw that the major ISPs were exploiting, according to Nicholas Demos, the local boss of MyRepublic, a Singaporean ISP that launched here last November and now has 35,000 customers. “It’s in their interests to just flick people to the low speed plans as the lower access charge makes it higher-margin for them,” he said, noting that 82 per cent of the 2 million connected customers so far were on plans offering download speeds of 25 megabits per second or less[7].

The government, fearing electoral backlash, this week asked the Australian Communications & Media Authority to interview ... The government, fearing electoral backlash, this week asked the Australian Communications & Media Authority to interview NBN customers about their experience. Glenn Hunt

The major ISPs would lift their game if they could regain some of the sense of ownership they previously had in the wholesale broadband market, according to Ian Martin of New Street Research, in an opinion piece published in today’s Financial Review.

“When you have your own capital at risk you’re driven to do things better and faster to generate a return,” he writes. “When carriers invest in network capacity they are driven to quickly increase utilisation and monetise their traffic.” Mr Martin noted that on competing owner-operated mobile wireless broadband networks, unlimited data plans were becoming a reality[8] while “ISPs are still finding ways to constrain data usage on the NBN”.

"I suspect we'll be one of the few ISPs to agree with Bill Morrow," said Aussie Broadband managing director Phil Britt, ... “I suspect we’ll be one of the few ISPs to agree with Bill Morrow,” said Aussie Broadband managing director Phil Britt, referring to the NBN chief executive’s blog last Monday blaming a “land grab” by retailers for the unsuitable service many customers had ended up with. Glenn Hunt

He proposes multi-year, discounted capacity leases as a replacement for the month-by-month purchase of bandwidth and separate access charges currently forced upon the ISPs.

He argues this would encourage the ISPs to manage the network more efficiently, and would help head off the prospect of an NBN write-off[9] by delivering a swathe of cash upfront. NBN Co spokesperson Tony Brown said the government-backed utility was open to all new ideas, but pointed out some ISPs were already proactively increasing their sense of ownership in the network. There have been four “area switches” under NBN’s “technology choice” program to date, he revealed, where an ISP had doorknocked a particular area and offered to subsidise the cost of a switch from fibre-to-the-node to superior fibre-to-the-premises connections, in return for all residents signing two-year contracts.

It is unclear where these four “area switches” have occurred, as Mr Brown was unable to reveal them.

reports.afr.com[10]

References

  1. ^ slow download speeds (www.afr.com)
  2. ^ spike in complaints (www.tio.com.au)
  3. ^ blog last Monday (www.nbnco.com.au)
  4. ^ admitted a 15 per cent dissatisfaction rate (www.afr.com)
  5. ^ asked (www.mitchfifield.com)
  6. ^ blasted (forums.whirlpool.net.au)
  7. ^ 82 per cent of the 2 million connected customers so far were on plans offering download speeds of 25 megabits per second or less (www.afr.com)
  8. ^ becoming a reality (www.afr.com)
  9. ^ prospect of an NBN write-off (www.afr.com)
  10. ^ reports.afr.com (reports.afr.com)

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