NBN Co to offer one month of bandwidth reduction to Internet service providers – Telco / ISP

NBN Co will offer Internet service providers “relief” from the additional bandwidth costs they may incur due to blockages, but will not resurrect a bandwidth bonus program that has been operating for much of the world. last year.

The company had come under pressure to act after the top five retail service providers, accounting for 96% of users, written to the government asking for intervention.

RSPs – TPG Telecom, Telstra, Optus, Aussie Broadband and Vocus – said they had seen a “significant increase in peak NBN usage” since lockdowns resumed in some states, and were therefore incurring additional costs.

They were unsuccessful in seeking help from NBN Co directly and reported the issue to the Minister of Communications.

NBN Co said today it will put in place a total of $ 5.2 million in “emergency credit … to support the provision of additional data to meet increased customer demand for broadband services. during closures in New South Wales, Victoria and South Australia in July 2021 “.

Executive Director General of Commerce Ken Walliss acknowledged that demand for customer data has “steadily increased as more states are stranded.”

To counter this, NBN Co would offer a “credit payment, which will be made on a pro rata basis to eligible retailers … to reduce the additional costs of retailer wholesale data overrun”.

“To assess the size of the medium, NBN Co took into account the long-term annual growth rate of data of around 25% and the average spend on excess data costs in fiscal year 20,” Walliss said. .

“The $ 5.2 million payment to all qualifying online retailers is intended to help bring back online retailer data excess spending with the two core costs.”

Walliss said retailers will receive a credit, covering the month of July, from August 3.

“It will be allocated based on each retailer’s share of the industry’s total national surplus, which represents the additional capacity purchased on top of the total capacity included for the wholesale plan reduction speed levels,” did he declare.

“NBN Co will also waive the fees for any breach of the CVC terms of use from June 25, 2021 to July 31, 2021.”

It looks like the relief won’t extend beyond July.

Walliss said NBN Co could not afford to revert to the original bandwidth bonus program that lasted much of 2020, whereby retailers received up to 40% more bandwidth compared to February 2020 levels at no additional cost.

“It was the right thing to do at the time, but it came at a cost, some of which was borne by taxpayers,” Walliss said.

“Had this continued, it would have potentially impacted NBN Co’s ability to invest in network upgrades to deliver faster speeds and additional capacity to meet historic annual growth in data demand. “

Walliss said more permanent solutions to bandwidth overrun charges could emerge from the renegotiation of the special access company (SAU), which is currently run by the Australian Competition and Consumer Commission (ACCC).

NBN Co had responded to the problem earlier this week, disagreeing with traffic figures put forward by retailers.

The company reinforced this point today, arguing that “as an industry wholesaler, NBN Co has a complete picture of the daily demand for data and the volume of traffic passing through our network.”

“We have typically seen the greatest increase in data demand in the first week of any lockdown, with demand for data leveling off and then decreasing as restrictions relax,” he said.

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