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National Broadband Network announces price cuts for high-speed internet plans

THE PRICE of broadband is set to fall next year after NBN Co revealed plans to cut the cost of its highest speed services yesterday to win more customers and improve its damaged reputation. But experts warned there were no guarantees the discounts would be passed on to consumers, or that the new packages would improve the network’s reliability, as it claimed. NBN Co[1] chief executive Bill Morrow said the company was negotiating with internet providers to drop the wholesale price of some of its plans, and include additional “capacity” to prevent slowdowns during peak times.

Mr Morrow said the discounts were designed to encourage more users to adopt higher speed plans as more than 80 per cent of NBN users adopted services offering 25 megabits per second or less, which was often no better than the technology they had used previously. “Without affordable higher speed plans, many end-users aren’t seeing the true potential of the NBN access network. Customer satisfaction levels fall if expectations of the ‘NBN experience’ aren’t met,” he said.

“We also recognise that we need to do something dramatic and quickly to encourage retailers to get end-users on to higher speed plans, as growth during peak hours continues to develop on the network.” The 12-month discounts, available after March next year, will see the wholesale price of a 50mbps plan cut by 27 per cent, to £45, and the price of a 100mbps plan cut by 10 per cent, to £65. Mr Morrow said NBN Co would also drop the price for additional bandwidth.

Finder.com.au spokesman Angus Kidman [2]said the NBN’s move was “encouraging,” and acknowledged NBN users’ negative feedback about slow connection speeds, high prices, and congestion on the network. “It’s a recognition that people don’t feel they’re getting the service they deserve when they pay for a more expensive plan,” Mr Kidman said. “The (download) speed is what gets talked about but the reality doesn’t feel much different to what users might have had.

It doesn’t feel like a big upgrade for many people.” But Mr Kidman also warned that it would be up to internet service providers to pass on the discounts to consumers, existing NBN users may have to seek out the discounted plans, and the additional bandwidth offered may not fix slowdowns currently experienced during peak periods. “It seems implausible that this offer is going to guarantee that on the day that everyone is trying to watch Game of Thrones that there won’t be significant issues there because overall capacity is not in place,” he said.

“The reality is that we’re at least six months away from knowing if that’s going to happen.”

NBN Co’s changes follow a difficult year for the company, in which it halted the rollout of HFC connections at a cost of millions of dollars, and after complaints about NBN services [3]to the Telecommunications Industry Ombudsman skyrocketed 159 per cent.

Both Optus and Telstra were forced to compensate thousands of NBN users [4]for billing them for download speeds the network could not deliver.

References

  1. ^ NBN Co (www.nbnco.com.au)
  2. ^ Finder.com.au spokesman Angus Kidman (www.finder.com.au)
  3. ^ complaints about NBN services (www.news.com.au)
  4. ^ compensate thousands of NBN users (www.news.com.au)

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