In March NBN Co announced it would provide 40 per cent extra CVC during the COVID-19 pandemic. This extra bandwidth was designed to help Internet Service Providers (ISPs) deal with the extra network loads as more people worked and studied from home. It has now extended this offering.
This extra 40 per cent CVC was supposed to expire on August 19, it has now been extended to September. Sky Muster satellite services will have access it to it until September 30.
This move isn’t entirely surprising. The second wave of cases across the country, particularly Victoria, had industry professionals speculating whether NBN Co would extend the offer.
“This is the right thing to do,” NBN Co’s Chief Customer Officer, Brad Whitcomb, in a press release.
“We trust the data capacity initiative will first and foremost support Australians’ heightened need for secure, high-speed access to broadband services at this critical time and, secondly, help give internet retailers the time and financial relief they need to adapt to their customers’ changing data demands.”
NBN Co reported that from July 13 to 19 downloads during the peak evening period rose by 34 per cent. This set a new record of 14.8 Terabits per seconds.
What is CVC?
CVC, or Connectivity Virtual Circuit, is what ISPs pay for to access a certain amount of bandwidth. The more they reserve, the better speeds they can provide their customers during peak periods.
NBN Co explains it in further detail here.
Is this enough?
While this is certainly good news for ISPs and customers, it is still a temporary boost. Some ISPs such as Aussie Broadband don’t believe that customer usage will never return to what it was pre-COVID, even once the virus is under control. As such, they think prices will rise once the offering is revoked.
In fact, Aussie Broadband and Telstra think that CVC structure needs to be abolished altogether.
“Even if NBN extends its COVID CVC offer, this is only a band-aid solution to a deeper problem,” Phillip Britt said in an email to Gizmodo Australia.
“We need to scrap CVC altogether and move to a single access charge based on the speed tier chosen, with no usage or CVC component. This is how other countries, such as New Zealand, operate. CVC is something that appears to be unique to the Australian market.”
“Given a lot of people will be continuing to work and study from home for the foreseeable future, we think it makes sense to extend the 40 per cent free allocation of CVCs for the locked down geographies for the time being,” a Telstra spokesperson said to Gizmodo Australia over email.
Only time will tell if NBN Co will need to extend the 40 per cent extra CVC offer again.