Aussie Broadband increased some NBN plan prices last month, and has now started getting in touch with existing customers to let them know their bill will be going up.
Aussie’s NBN 100 plan prices are going up by $10 per month, taking Aussie’s unlimited NBN 100 / 20 plan up to $99 per month, and its unlimited NBN 100 / 40 plan to $109 per month. This puts Aussie firmly in the premium provider category. So, are its plans still worth it?
Why did Aussie Broadband’s plans get more expensive?
Aussie Broadband says it increased the price of its NBN 100 plans because it only breaks even – or in some cases – losing money on them.
Delivering an NBN service isn’t cheap – especially a high quality one. Before we even consider costs like staff and infrastructure, the price a telco has to pay to sell an NBN can blow out quickly. There are five factors that contribute to the price of an NBN plan.
The major component is Access Virtual Circuit, or AVC. This is a flat access fee telcos pay to the NBN for each customer, with pricing increasing with each speed tier. To sell an NBN 100 / 20 plan, a telco is up for $58 per month.
CVC has a lot to do with it
All telcos selling an NBN plan also need to purchase capacity, or CVC. Telcos typically have to find the right balance between how much CVC they purchase and the price they charge for the plan. Purchase too little CVC, and you get congestion during peak hours. Purchase too much, and plans become too expensive.
CVC is billed at $8 per Mbps, but NBN also includes a little bit of capacity as part of the AVC charge. For example, an NBN 100 / 20 plan comes with 3.75Mbps of CVC as a standard inclusion.
Telcos also need to pay NBN a Network-to-Network Interface charge, which essentially buys a connection to the NBN. For the most part, this should cost less than $1 per customer per month.
And then there’s backhaul and transit
Lastly, a telco also needs to pay for backhaul and transit. Backhaul is the connection between the NBN and a telco, whereas transit is the connection between a telco and the wider internet.
At wholesale prices, you’re roughly looking at $1 per Mbps for backhaul, and $3 per Mbps for transit. To avoid congestion, a telco wants to have the same amount of backhaul and transit per customer as they do CVC.
Some telcos own their infrastructure, which allows them to cut down on costs. Others need to purchase connectivity through a larger provider.
If we assume Aussie Broadband assigns about 5Mbps of CVC per NBN 100 customer, the telco would be paying $70 per month in AVC and CVC.
Adding on 5Mbps of backhaul and CVC would take that to $90 per month, which is $1 more per month than what Aussie previously charged for an NBN 100 plan. And once again, this is before factoring any other costs the business has.
While a price rise is never going to be popular, the math on Aussie’s price rise checks out.
Aussie Broadband plans
Here’s the complete range of unlimited Aussie Broadband plans:
And here’s a look at how Aussie Broadband’s plan stack up to the competition.
Unlimited NBN 100 plans compared
Thanks to the $10 per month price rise, Aussie Broadband now firmly sits at the top-end of the market. Alongside the likes of iiNet, Internode, and Telstra.
Both iiNet and Internode charge $99.99 per month for an NBN 100 plan, but they report typical evening speeds than Telstra. iiNet reports speeds of 83.6Mbps during peak hours, while Internode reports 85Mbps. Aussie Broadband reports typical evening speeds of 86Mbps on NBN 100 plans, for comparison.
Telstra’s NBN 100 plan is down to $100 per month right now thanks to a timed promotion. You’ll save $10 per month for your first year with Telstra, bringing pricing in line with Aussie. Telstra also reports slightly faster evening speeds of 88Mbps, includes 4G backup with its plans, and new customers can nab themselves three months of free access to Binge. This can be extended by another three months by signing up to Telstra Plus.
However, be aware that while Telstra’s NBN plans are contract-free, you’ll need to pay out a modem fee if you leave early. This is equivalent to $9 multiplied by the number of months remaining in your two-year term. If you left after your first-year discount expires, you’d need to pay a $108 modem fee when you cancel your contract.
Telstra NBN 100 plans are only available to customers with HFC or FTTP NBN connections.
On the other side of the pricing spectrum is Tangerine. You’ll pay $74.90 per month for your first six months, and then $89.90 per month thereafter. Tangerine plans are contract-free and come with a 14-day risk-free trial. Tangerine will refund your plan fees if you decide you’re not happy within your first fortnight.
Superloop is also a solid choice when it comes to promos, offering its NBN 100 plan for $79.95 for your first six months and $89.95 per month thereafter. Superloop reports typical evening speeds of 90Mbps, which is the fastest of any major provider. As with Aussie Broadband, Superloop publishes CVC graphs that show how much capacity it has in each area and how much is being used.
When you avoid timed promos, MATE is the cheapest option at a flat $79 per month. You can also save a further $10 per month by bundling a MATE Telstra-powered SIM-only plan onto your account. These start at $20 per month with 5GB, but the $25 per month plan with 15GB is a much better buy. MATE reports typical evening speeds of 83Mbps.
Unlimited NBN 50 plans compared
Aussie’s NBN 50 plan prices have held firm, but it’s still worth taking a look at how they stack up to the competition.
An unlimited NBN 50 plan on Aussie Broadband will set you back $79 per month, which is definitely at the higher end of the market. Aussie reports typical evening speeds of 43Mbps on NBN 50 plans.
Superloop is priced in line with Aussie Broadband, offering its NBN 50 plan for 5 cents per month less, but slightly faster evening speeds of 44.4Mbps. Realistically, we wouldn’t expect that to make a major difference day to day, however.
Telstra is only $1 more per month than Aussie Broadband thanks to its new promo where you’ll save $10 per month for your first year with Big T. But as with Telstra’s NBN 100 plan, you’ll need to pay out a modem fee if you bail in your first two years. This is equivalent to $9 multiplied by the number of months left in your term.
Telstra reports evening speeds of 44Mbps on NBN 100 plans.
If you want the fastest widely available NBN 50 plan you can get, iiNet should be your go to with typical evening speeds of 46.7Mbps. This will set you back $74.99 per month with no-contract.
SpinTel is currently your cheapest option for NBN 50 plans thanks to a timed discount. You’ll pay $59 per month for your first six months, and $64.95 per month thereafter. SpinTel does only report typical evening speeds of 40Mbps, however.
What if I want a cheaper Aussie Broadband plan?
Aussie Broadband also offers NBN 100 plans with smaller data allowances. If you want to save a few dollars you could drop down to a 500GB NBN 100 plan billed at $95 per month. This may not work for everyone, but if 500GB is enough for you, downgrading to a lower tier is a pretty great way to save a little cash each month.
Alex Choros is Managing Editor at WhistleOut, Australia’s phone and internet comparison website.