NBN Price Changes – Aussie Broadband lays out impact of new NBN wholesale pricing

If you’re digging around the Internet trying to understand why NBN prices are changing, get set for confusing because if there’s another three letter acronym introduced into my world I’ll lose my mind.

Your monthly internet access price might be changing – for better or worse, and it’s all because of the NBN’s SAU with the ACCC relating to their WBA and how they use their CVC in each CSA accross all the AVC’s in each PoI.

You good with that?

Look, I don’t want to pretend to understand it all, but in simple terms, for some years now the ISP’s (Sorry! Internet Service Providers, or RSP’s Retail Service Providers) that we all buy our internet plans with have been meeting with the NBN (National Broadband Network) to make their wholesale pricing (we assume under the WBA – Wholesale Broadband Agreement) fairer for the modern age.

You see NBN pricing was created in a age when 25mbps seemed fast. Now 1,000mbps home internet is available to millions.

So, NBN goes to the Australian Competition and Consumer Commission (ACCC) to update their pricing plans (Special Access Undertaking – SAU).

And this week, that was all approved.

For the record, a PoI is a Point of Interconnect – which is basically your local NBN “exchange”, and CSA’s (Connectivity Serving Area) and AVC’s (Access Virtual Circuits) all work within that to get us on the internet.

A huge point of contention though has been the CVC – the Connectivity Virtual Circuit – this is basically how bandwidth and capacity on the network is charged to retailers, and therefore it affects our home internet costs.

Today, Aussie Broadband announced their new pricing structure under the new agreement, and it’s great for anyone on 100mbps speeds or more, and pretty shit for those on lower speeds.

Here’s how it looks:

I’m stoked, my plan goes down $20! But if you’re on those lower plans, they all go up by $6.

According to the O.G. of straight shooting when it comes to NBN retail pricing, Aussie Broadband CEO Phil Britt – this was because of how the NBN’s new deal played out:

“By not only continuing to charge CVC, but doing so on an individual basis, the NBN has effectively forced our hand to raise prices for the majority of our broadband customers – and at a time of heightened financial uncertainty.”

What’s most worrying is the scale of the impact, according to Mr Britt “The 50/20 tier represents about 45% of the overall market”

Sadly, it’s a case of haves and have nots, because as Britt says “This is good news for our customers on higher-speed 100/20, 100/40, 250/25, and 1000/50 plans, who will enjoy a price reduction come 21 November.We have been able to pass on these savings due to the removal of Connectivity Virtual Circuit (CVC) for these plans, something I have long advocated for. Removing CVC from pricing simplifies how we manage costs for our NBN customers on higher-tier plans, allowing us to provide savings for our customers through these pricing efficiencies.”

Why high speed and likely high-use plans are able to be charge without the CVC yet the same can’t happen at the lower end is impossible to understand.

This is all about ensuring that NBN is making money, can continue to invest in infrastructure and upgrades but it’s going to hit hard for those on the lower speeds, at the wrong time for any price increases.

For those not with Aussie Broadband, it’s probably worth touching base with your provider to see how this affects you.