Aussie Broadband prices just went up across some of its plans — and the changes will impact both new and existing customers.
This story was originally published on August 4 at 4:45pm.
Aussie Broadband warned us about this
Last month Aussie Broadband’s managing director Phill Britt warned NBN price increases were on the horizon due to COVID-19. While telcos expected an increase in usage, several stated that the actual numbers were unprecedented.
Early in the pandemic NBN Co gave telcos 40 per cent extra CVC for free. This was to help accommodate the extra bandwidth needed with more people working and studying from home.
This offer had already been extended once by the time Aussie Broadband warned about price increases. COVID-19 cases were on the rise again in Victoria and it was predicted that NBN Co would extend the free CVC offer a second time.
“NBN’s extra 40 per cent CVC bandwidth to cope with peak demand during COVID certainly cushioned the impact,” Britt said to Gizmodo Australia at the time.
“But once it’s gone, we don’t believe traffic levels will return to original forecasts even without areas of the country going in and out of lockdown.”
But it’s not gone. In fact, the free CVC got extended again, this time until September 19. Despite this, Aussie Broadband raised its NBN 100 and senior unlimited prices this week while still utilsing the extra free bandwidth.
The timing is certainly interesting. If NBN Co’s free CVC offering wasn’t extended this month, Aussie Broadband could have placed some of the blame on it. Britt’s warnings last month seemed to be a primer for that outcome.
But with the extension in place, one has to wonder why Aussie Broadband raised its prices during a pandemic.
It just isn’t enough
According to Aussie Broadband, the extra 40 per cent CVC is still not enough to keep its NBN 100 and senior unlimited plans in the black.
“We need to raise the price of some of our plans because of increased costs associated with the data being used on those plans,” Britt said in an email to Gizmodo Australia.
“Part of this cost – but not all – is the NBN CVC charge. Even with NBN’s extra CVC COVID offer, we are either at cost or losing money on those plans.”
This statement is nothing new for Aussie Broadband, or other telcos in market.
“Even if NBN extends its COVID CVC offer, this is only a band-aid solution to a deeper problem,” Phillip Britt said to Gizmodo Australia several weeks back.
“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.”
Telstra agrees with this perspective. “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.
“Or, as we and others in the industry have called for previously, for NBN Co to look at removing the CVC pricing structure altogether.”
Regardless of where the blame lies, Aussie Broadband is aware of how bad price increases look during a pandemic.
“We know this change won’t be popular but we can’t continue offering plans that are barely at cost price, or making a loss,” Britt said in a post on Whirlpool.
Not just new customers
Those impacted will include existing Aussie Broadband customers, though they are getting some notice. While in the past some have enjoyed the benefits of grandfathered plans over the last couple of years, that will no longer be the case.
According to Aussie Broadband, impacted customers will receive email advice about the change in September. ” We’re giving them 60 days’ notice from that date of their proposed plan change. Customers can jump into MyAussie or call us and choose another plan at any stage if they want to,” Britt said to Gizmodo Australia in an email.
New Speed Tier
To offset the price increases Aussie Broadband has added a new NBN 75/20 speed tier to its line up. It costs $89 a month for unlimited data, $85 a month for 500GB/month and $80 for 100GB/month.
New Aussie Broadband Prices
The impacted plans include residential and business NBN 100/20 and NBN 100/40 plans. These will go up by $10 a month.
This brings its unlimited NBN 100 plan up to $99/month and its unlimited 100/40 plan up to $109/month.
Looking at the other options in market, the 100/20 increase still doesn’t make it the most expensive option out there. But it does push it from a mid-range pricing choice to the upper level. However, Aussie Broadband does still have one of the faster typical evening speeds available at the moment.
Aussie Broadband’s Seniors Unlimited plan will also be going up by $6 a month.
None of Aussie Broadband’s NBN 12, 25, 50, 250 or 1GB plans are going up in price at the present time.
“Price rises are a tough call for us, especially while COVID continues to impact our nation — and at the moment, particularly Victoria, where we are based,” Britt said in an email to Gizmodo Australia.
“We’re not out to make an outrageous profit but we do need our prices to be sustainable.”