The extensive and protracted process of reaching a consensus on new price and non-price terms for the National Broadband Network (NBN) has concluded, with the Australian Competition and Consumer Commission (ACCC) granting approval for a revised special access undertaking (SAU) after multiple rounds of revisions.
In essence, the agreement is somewhat of a formality, as internet service providers had grown weary of the prolonged negotiations, particularly due to the extra costs incurred as a result of the delays.
This protracted negotiation process necessitated concessions from all parties involved. The ACCC, in its recent statement, acknowledged that the variation it has accepted contains some aspects it does not endorse, but these are assessed not to significantly impact the interests of broadband users.
One of the key alterations pertains to NBN pricing, particularly in ending connectivity virtual circuit (CVC) bandwidth charges for services exceeding 100Mbps, effective from December 1, and for all other services by mid-2026.
The entry-level broadband speed for the initial three years of the agreement, known as the first regulatory cycle, will be set at 25/5Mbps.
Under the new pricing structure, a basic voice and data service will be introduced at roughly half the cost of NBN Co’s existing entry-level broadband offering, according to the ACCC.
The ACCC also noted that wholesale prices for 25Mbps and 100Mbps or faster speed services will be reduced, partially offset by a small increase in the wholesale price for the 50Mbps speed service.
These pricing adjustments are intended to safeguard customers from potentially larger price hikes in the future when NBN Co will be permitted to recoup a portion of the costs invested in the network.
Through this process, NBN Co has committed to limiting its ability to recover expenses in the future, with the ACCC having a continued role in overseeing this aspect.
Finance Minister Katy Gallagher and Communications Minister Michelle Rowland expressed their approval of the new SAU, acknowledging the necessity of a change in government to reset the regulatory process and reach this point. The initial proposal, submitted under the previous Coalition government, allowed for annual price increases of inflation plus three percent on certain products, which was unacceptable to the ACCC.
NBN Co’s Chief Regulatory Affairs Officer, Jane van Beelen, sees the passage of the SAU as the beginning of a significant new era for the Australian telecommunications industry. She emphasized the collaborative efforts of NBN Co, the industry, the ACCC, and the government in shaping the future of wholesale prices and service standards.
The removal of CVC charges on higher-tier plans was welcomed by Australian internet service provider Aussie Broadband, which primarily serves customers on these plans. The changes, particularly the revised pricing model, are of great interest to NBN customers. Aussie Broadband plans to inform its customers about the specific changes to their individual plans on October 20, with the changes taking effect on November 21.
