Internet providers are facing pressure due to a 15-month freeze on the amount of bandwidth bundled with NBN plans (National Broadband Network plans). The regular increases to the amount of connectivity virtual circuit (CVC) bandwidth that came with NBN plans ceased in May 2022, and providers are feeling the effects.
The lack of progress in reaching a new pricing agreement under a revised special access undertaking (SAU) has exacerbated the situation. Some providers believe this delay and the bandwidth freeze are tactics to increase financial pressure on them to reach an agreement.
Internet providers are calling for NBN Co to resume regular bandwidth increases or provide financial compensation for the impacts of the freeze. They argue that the freeze has led to higher overage costs and reduced their ability to offer affordable services to consumers.
While NBN Co has offered a $12 million “transitional relief” fund to help with the cost increases caused by the SAU process, providers find it insufficient. There is also confusion about the purpose of the fund, whether it is meant to offset the financial pressure from the CVC freeze or cover now-redundant IT costs incurred before the recent change in the future pricing model.
Internet providers are urging NBN Co to increase CVC inclusions immediately to alleviate the financial burden on the industry and prevent potential retail price rises before the new SAU comes into force. They believe that any credit should be paid to retailers without being conditional on SAU acceptance to avoid additional pressure on the industry.
