Michael Peters

Internet Service Providers have started revealing retail prices for internet and phone services delivered via the National Broadband Network – however the business case has not been made.

It will be virtually the only pipe linking more business and households than any other technology there should be a nominal access point price: a price level that anyone can afford, offering a basic service.

On Internode, customers will have to buy a bundled package that includes both home phone and internet access and the cheapest plan at the slowest speed will be $60 for 12 megabits per second connections and 30GB of downloads. To get the full 100 Mbps speeds promised by the government with a 200GB quota the price rises to $120 a month, and boosting this to 1 terabyte costs $190.

At this cost the current price model has more to do with supply side needs rather than the need to ensure everyone has the right and the ability to the network.

The government-funded group, the Australian Communications Consumer Action Network, has backed the pricing plans for the broadband network despite expressing surprise over their high cost. Another ISP, Exetel, has announced its price plan today, and it is the cheapest to date, however even the basic plan costs $34.50 per month and delivers a speed of up to 12Mbps and a quota of 20GB of data.

What we need is ongoing surveillance of the NBN, now that the Broadband Network will start to use Telstra’s copper wire and ducting capabilities, and migrate new customers onto the high speed optical network.

NBN Co looks like becoming what Telstra was less than a decade ago. A large monopoly owned by the state. Telstra was the ‘bad boy on the block’ and the NBN looks set to take the same route.

The failure of competition law to ensure access to the network allowing others to compete is to be deplored. It has yet to be seen if the NBN will encourage content creators and providers to flourish.

Michael Peters is a Lecturer in Business Law and Taxation at the Australian School of Business.