AU Consumer Broadband Update FY24

NBN wholesale changes reorder the retail market as Fixed Wireless Access becomes more competitive against entry-level NBN tiers.

Heath Gibson · Executive Manager – Industry Intelligence and Insights at NBN Australia5 August 2024Period: FY2412 min read

49%→

Share of NBN services on Standard speed tier (March 2024)

23.8%↑

CAGR of internet traffic (FY19-FY23)

Locked

+1more stats

Companies covered:

Abstract

Households increasingly rely on digital services, with telecoms hardware and service prices falling relative to the general price level for over a decade. Despite this, spending on communication services has risen, reflecting their growing importance. This report analyses the fixed broadband strategies used by service providers to attract consumers. NBN pricing is a key determinant of retail price; recent NBN wholesale price changes have reordered the market. This report summarises how retail service providers have responded, and which customer acquisition strategies they are favouring.

Key Takeaways

NBN wholesale price changes have compressed the market, with entry-level Basic plans increasing by up to 17% while Ultrafast tiers fell by $40 per month.
Fixed Wireless Access (FWA) has become more competitive, with basic wireless plans now priced at 81% of their NBN equivalents, saving consumers $10-$16 monthly.
The Standard NBN speed tier remains the most popular choice for consumers, accounting for 49% of all NBN services as of March 2024.

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Frequently Asked Questions

Wholesale price restructuring has compressed the market, forcing a 17% price increase for entry-level Basic plans while simultaneously cutting Ultrafast tier costs by $40 per month. Despite these shifts, the Standard speed tier remains the dominant market anchor, accounting for 49% of all NBN services as of March 2024.

Fixed Wireless Access (FWA) is now a significant competitive threat, with basic plans priced at just 81% of their NBN equivalents. This pricing strategy allows challengers to undercut NBN providers by $10-$16 per month, targeting budget-conscious consumers.

High-speed tiers currently represent 22% of the NBN subscriber base, but a major shift is imminent. NBN Co has proposed upgrading the 100 Mbps 'Fast' tier to 500 Mbps at zero additional wholesale cost, which will likely trigger a mass migration of the user base toward ultra-high-speed services.

Market leaders Telstra and Optus are abandoning the 'Smart Home' segment, evidenced by the withdrawal of premium support services like Telstra Platinum and Optus O-Team. This retreat signals a shift in focus back to core connectivity and infrastructure competition rather than peripheral technical support.

Abstract

Key Takeaways

Frequently Asked Questions

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