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NBN Co opens up CVC pooling nationally to RSPs

NBN Co opens up CVC pooling nationally to RSPs

Pooling mechanism will cover fixed line and fixed wireless services

Credit: NBN Co

NBN Co has agreed to let internet retail service providers pool their connectivity virtual circuit (CVC) bandwidth across Australia following a long-running wholesale consultation.

From May 2020, RSPs will be able to share unused data capacity at a national level across fixed line and fixed wireless services in an attempt to reduce their costs.

Previously, RSPs could only pool CVC across geographic areas associated with 121 Points of Interconnect (POIs).

According to NBN Co, this will mean RSPs can more cost-efficiently purchase capacity to serve fixed and fixed wireless customers across all Connectivity Serving Areas (CSAs) in Australia.

The national broadband provider claims this will make it simpler for retailers and helping them to manage costs. It has yet to reveal details of the calculation methodology to update future National Broadband Network (NBN) discounts, credits and rebates list.

The announcement comes in response to the Australian Competition and Consumer Commission’s (ACCC) most recent inquiry into NBN Co’s wholesale pricing.

This time, the ACCC examined NBN Co’s “basic” speed — around 12/1 Mbps — broadband prices, considering whether these allow RSPs to offer “attractive retail plans” for consumers.

As part of its own five-month review of its wholesale prices, NBN Co said it plans to introduce an overhead allowance for the downstream component of most fixed line wholesale speed tiers, where possible, to assist RSPs to supply higher retail peak download speeds to customers.

It will also offer two-year discount bundle roadmap, which it claims will provide RSPs with “greater certainty on future wholesale prices” and data capacity inclusions

“Retailers strongly advocated for greater certainty on future wholesale prices, more included data capacity and better value for money. We’ve listened and this is exactly what we’re announcing today,” NBN Co residential chief customer officer Brad Whitcomb said.

“The key point is that NBN Co continues to create greater value, which is making broadband even more affordable despite consistent increases in data demand. Since 2016, we have more than halved the effective wholesale price of CVC, which applies to purchased capacity.”

NBN Co also said it is introducing three new wholesale high-speed tiers and associated bundle discounts, which will be available from May 2020.

These include a new 100/20 bundle discount, starting with 3.75Mbps of included CVC capacity at an effective charge of $58 per month; a 250/25 bundle discount, starting with 4.75Mbps of included data capacity at an effective charge of $68 per month; and an up to 1000/50 bundle discount, starting with 5.75Mbps of included data capacity at an effective charge of $80 per month.

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