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NBN resellers warned to boost CVC after COVID freebies

NBN resellers warned to boost CVC after COVID freebies

Total CVC capacity acquired by RSPs fell by 2.3 per cent to 19.8 Tbps for the December 2020 quarter.

Credit: NBN Co

Australia’s consumer watchdog has warned retail service providers to start buying up more National Broadband Network (NBN) Connectivity Virtual Circuit (CVC) capacity following the end of NBN Co’s COVID-19 capacity giveaways. 

The Australian Competition and Consumer Commission (ACCC) has reported that total CVC capacity acquired by RSPs fell by 2.3 per cent to 19.8 Tbps for the December 2020 quarter.

According to its latest NBN Wholesale Market Indicators Report, average CVC per user fell by 2.4 Mbps, a fall of 5.6 per cent for the same period.

“NBN’s temporary COVID-19 CVC boost offer has expired, so it’s important that retail service providers provide sufficient CVC capacity for consumers to continue to receive the speeds they are paying for, particularly during periods of high demand,” ACCC chair Rod Sims said. 

NBN Co initially waived RSP charges for additional capacity of up to 40 per cent to help them cope with an anticipated surge in demand amid the ongoing coronavirus pandemic. 

Lasting between March to December 2020, NBN Co then agreed to offer more discounts and rebates on higher speed plans following the end of the CVC provisions.  

Meanwhile, according to the report, more than 8.1 million household and business services are now connected to the NBN, a 3.6 per cent growth in the December 2020 quarter. 

This saw an additional 279,347 new households and businesses connect to the NBN, coincided with the Minister for Communications Paul Fletcher declaring in late 2020 that the NBN build was complete and fully operational. 

The report revealed that 5.5 million broadband connections, or 68 per cent of all services acquired from NBN, are on higher speed tiers of 50Mbps and above. 

Meanwhile, about 16 per cent of wholesale services acquired at speeds of 100Mbps or above, although a third still remain on a maximum of 25mbps speeds. 

In terms of market share between RSPs, Telstra’s share of services acquired from NBN fell slightly to 45.5 per cent. 

However, market shares of the other large retail service providers were largely unchanged. TPG currently accounts for almost a quarter of the market, while Optus holds 15.5 per cent and Vocus 7 per cent.

Among the smaller retail service providers, Aussie Broadband increased its overall market share to 4.2 per cent in the December quarter, up from 3.9 per cent in the previous quarter. Other small retail service providers accounted for the remaining share of 3.3 per cent. 


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