If you know the speed of your internet connection in Australia, you are among a minority, according to the company responsible for deploying the National Broadband Network (NBN) across the country.
According to NBN, 76 percent of Australians do not know the speed of their connection, and 35 percent are unaware they are able to choose a speed tier when connecting to the NBN.
The solution to this ignorance, NBN believes, is to launch yet another marketing campaign that will nationally hit TV, direct mail, and newspaper lift outs.
In May, NBN informed Senate Estimates its last nationwide marketing campaign cost AU$7.8 million excluding GST thus far.
“We actually can see that there is a return on this. The brand image, the attractiveness, and of course the desire to take up the services sooner make the amount of spend — and it is less than AU$10 million … is well worth the investment,” Morrow had previously told Senate Estimates.
NBN has now added that this spending was delivered within its budget, “which was allocated based on the optimal audience reach to drive activations on the NBN”.
During January 1, 2016, to February 28, 2017, NBN spent a total of AU$34.5 million excluding GST on “advertising and information campaigns”: AU$22.6 million on paid media advertising and production; AU$7.9 million on physical and electronic “mail awareness and education”; and just under AU$4 million on in-person demonstration, education, and information provision.
NBN has been ramping up its advertising campaign; AU$22.99 million of this AU$34.5 million was spent during the 2016-17 financial year up until February 28, 2017.
During 2015-16, NBN also spent AU$41.8 million on “activation, communication, and public education campaigns” and AU$9.5 million on corporate affairs, market research, and the supporting operational systems for this.
Earlier this week, a survey conducted by Galaxy and commissioned by ISP MyRepublic said half of Australians could not name their internet speed.
The survey said Australians are dissatisfied, want faster internet speeds, and are looking to New Zealand as model for how broadband should be priced. According to MyRepublic, 65 percent of all respondents said they wanted increased speeds, with 76 percent of respondents after internet speeds of 1Gbps or more.
MyRepublic touted 34 percent of NBN-connected respondents saying their speed was good enough to run a home business, however 61 percent of those aged 24 to 34 said their NBN connection was satisfactory to run a business.
An overwhelming majority, 85 percent, wanted a price level similar to New Zealand and not one around the AU$400 mark that MyRepublic claimed previously
“The research also sends a clear message to the nation’s ISP’s [sic] and government: Australians are dissatisfied with their slow home internet speeds, they want 1Gbps speeds or more, they are worried about losing the digital economy race, and believe we are getting a raw deal compared to our Kiwi cousins,” the company said.
Managing director of MyRepublic Australia Nicholas Demos said the pricing model used by NBN needs to be reviewed.
“In the other countries MyRepublic operate [sic] in, the wholesale network (equivalent to NBN in Australia) provide[s] alternative pricing models that allow us to deliver affordable speeds of up to 1Gbps to the consumer market,” he said.
“The current finger pointing between RSP’s [sic] and NBN on who is to blame for poor network speeds is not constructive and we would rather focus our energies on ensuring the combined AVC/CVC wholesale price regime works for everyone — the wholesale provider, RSP, and the end consumer.”
Speaking to ABC on Friday morning, NBN CEO Bill Morrow said he sees many cases where people get onto the NBN and expect gigabit speeds, but do not seek a 1Gbps plan.
“If they don’t talk to their telephone provider, internet provider, they get put on to a 12Mbps service, because that’s what the provider put them on,” he said.
“That doesn’t mean it can’t do more, that doesn’t mean it isn’t better than what they had in terms of the capability, it just comes back to the point … everyone out there must talk to their provider about choices, and what is right for them in their home.”
Morrow reiterated his claim that demand is not present for 1Gbps services, and said most users found a 25Mbps service satisfactory.
On the issue of speed complaints, Morrow said it was the fault of NBN’s retail service providers.
“Remember, they’re attaching their network to ours,” Morrow said. “We are, by design, not even supposed to know the name of the people that are using the service.”
In a speech delivered last week, Australian Competition and Consumer Commission chairman Rod Sims said retailers had in turn blamed speed issues on NBN’s connectivity virtual circuit (CVC) charge.
“For RSPs the answer was clear. The general view we heard (from both large and smaller RSPs) was that with current CVC pricing, many were reluctant to sell these services,” Sims said.
“That is, far from consumers not wanting higher speeds, RSPs were often not seeking to sell them, at least not at prices consumers are willing to pay. We heard their view that AU$60 per month is the average price point in the market for NBN services.”
Sims said some retailers felt the CVC was more suited to a pure fibre to the premises network, where speed tiers could be guaranteed, something that is not possible under the multi-technology mix NBN that embraces fibre to the node.
Last month, NBN introduced a new CVC pricing model that saw retailers charged on their individual averages rather than an industry average.