AU government does not want lower broadband prices, asks for prices to remain the same.

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  neil on 02/07/2015 - 12:19

  +1

  It's quite a complex issue but the meat of it is this:

  Reductions in access charges passed to consumers as lower retail prices will open a gap between entry-level broadband prices on the Telstra network and equivalent offerings on the NBN. While most consumers would prefer lower broadband prices while they wait for the NBN, price differentials that favour legacy networks will delay migration, and mislead consumers about the prices they should expect in the future.

  Even if reduced access prices are not passed to consumers but retained by RSPs as higher operating margins, the issue of a price shock that distorts the migration to the NBN remains, as RSPs will have an incentive to attempt to delay the transition.

  That sort of makes sense in the perspective of managing the NBN. Even now, it can be a bit of a price increase switching from ADSL to NBN. My local area (Brunswick) has the copper entirely switched off however this was delayed many times as there were still people not switched onto the NBN.

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    Diji1 on 02/07/2015 - 12:47

    sort of makes sense

    Are you seriously saying it's a good idea to not reduce prices to customers using slow broadband because ISPs want to charge more for faster broadband and they couldn't "get away with it" if customers became used to lower prices? They being Telstra, Australia's most profitable ISP that apparently can't even supply a network good enough for Netflix?

    http://www.theregister.co.uk/2015/05/13/telstra_offers_seven…

    Cable TV is pretty profitable though eh.

    • 

      neil on 02/07/2015 - 13:03

      As a consumer, no. As someone in charge of managing the NBN, yes.

      Both sides of government made wild promises about how many residences would be on the NBN and the timeframe. If you are telling the average consumer to stay with your current ADSL (given they are fine with the speed) or pay a good deal more for a similarly perceived service, they'll probably hold out as long as they can. A friend of mine just got on the NBN via FTTB and it's costing him $90 compared to his old Exetel ADSL plan of $50/month. He was delaying as much as he could due to his deal but decided he wanted Netflix so went to NBN.

      If Turnbull really believed his letter, perhaps the wholesale cost should be lowered but a fee of some sort to make up the difference which profits the NBN. So instead of Telstra pocketing the profit, NBN does.

      • 

        goosmurf on 02/07/2015 - 14:23

        You make a great point — if the goal as stated is to make the NBN successful why let Telstra profit that margin?

        It's a fascinating discussion and this is worth a listen: http://phildobbie.com/main/podcasts/crosstalk/item/1390-admi…

        Essentially the UFB, NZ's version of the NBN, has lower uptake but yet the commercial builders of the various parts of the network are (so far) happy with the return they're getting/forecast.

        In contrast it seems NBNCo (or now nbn[tm]) seems to have to try very hard to get people to switch over to make the financials work.

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    jnewau on 02/07/2015 - 13:03

    Or to paraphrase NBN and Turnbull - now that most NBN customers are getting a second rate FTTN solution, we're a bit worried that people will hold off signing up to this turkey for as long as possible, particularly if ADSL becomes even more attractive pricewise.

    I'd have lined up to hand my money over for FTTP but I'll move to FTTN as late as possible. I have a good sync for ADSL2 now (20Mb) - who knows what the hell I'll get under FTTN and why would I want to pay any more for it?

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      whats up skip on 02/07/2015 - 14:51

      What!!!

      Are you trying to suggest you will receive a slower speed with FTTN, compared to ADSL 2?

      That is just stupid. Of course the speed will be faster. Given your current speed you will probably get more than 60Mbps download (likely 75Mbps), but more importantly your upstream speed will increase by a much great percentage.

      • 

        jnewau on 02/07/2015 - 15:59

        Don't be stupid, of course I'm not, but there is NO guarantee that I will see any hugely improved speeds. I might get lucky, I might not. If I get 20Mbps now and I get 40Mbps on FTTN why the hell would I bother?

        All the FTTN trial results so far have no basis in reality with completely fudged artificial results on brand new copper runs. Why would you think I would get 60Mbps or 75Mps? I could end up further from a node than I am from the exchange currently. I'm 600m from the Exchange which is great for ADSL, but 600M is very bad for FTTN. All NBN will promise is to 25Mbps, and who know what the remediation process is anyway if you don't get that.

        This is why it is such a shambles - we have gone from a plan to have a guaranteed speed to anyone who orders it (bar ISP backhaul issues) with FTTP and are stuck again with a system where your speed is determined by how lucky you are to have a node nearby, yet you'll be expected to pay the same as someone getting the higher speed.

        What I am saying is that I WOULD have run to sign up for a guaranteed 100/40 Fibre service.

        What I am not interested in paying more for is some possible mediocre upgrade. I am sure plenty of people feel the same way.

      • 

        Tnetennba on 09/07/2015 - 23:37

        @jnewau: Just so you know, 600m isn't too terrible on FttN, I'm on a VDSL2 (basically FttN) service in Canberra over 900m from the nearest Supernode (fibre point), and I get over 52/12. I'd expect (as long as your copper isn't too bad) you'd get 50-60mbps minimum at 600m from a node, and you could even be lucky and get one very close.

        Just saying, it would certainly be well over the adsl2 speed, and your upload will significantly faster. If you can get a good price on that kind of NBN, it's definitely worth signing up for. If it's 2x the price, and you don't have a high traffic household, you probably don't need it (as long as the copper network remains "switched on").

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  whats up skip on 02/07/2015 - 15:02

  +1

  I think most people are dreaming if they think they will see a price reduction because of this Telstra wholesale local loop price change.

  Optus announced new plans recently and has overloaded their network, so any additional "profit" is likely going to fix their network problems.

  iiNet/Internode won't change their prices while they are in a sales process.

  TPG don't need to change their prices as they are the price leaders of all the major providers. Also the purchase of iiNet means they are unlikely to change strategies.

  As for the rest (other than Telstra) their ADSL market share is so small that they now have little impact on the market.