NBN anticipates big lift in NBN connections

NBN Co targets a return to growth through greenfields FTTP expansion and winning back fixed wireless market share.

David Kennedy · Venture Insights22 November 2024Period: FY254 min read

8.801m→

NBN Co Installed Base (June 2024)

45,000↑

Net Connection Gains (FY24)

Locked

Companies covered:

Abstract

This report analyses NBN Co's Consultation Paper 1 for the FY27-FY29 regulatory cycle, highlighting a projected acceleration in connections. Despite NBN Co gaining only 34,000 connections in FY23 and 45,000 in FY24, the new strategy assumes a significant lift in greenfields FTTP and fixed wireless take-up. The analysis questions the feasibility of these assumptions given the current 15% of households without fixed broadband and increasing competition from mobile network operators and LEO satellite providers.

Key Takeaways

NBN Co is forecasting a significant lift in connections for the FY27-FY29 period to support its goal of cost recovery by FY31.
Actual performance has lagged, with only 45,000 connections added in FY24 compared to a previous forecast of reaching 9.0m total users.
The growth strategy relies on converting the 'stubborn' 15% of households that currently lack a fixed broadband connection.

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Frequently Asked Questions

Growth has slowed significantly, with net connection gains of just 45,000 in FY24 and 34,000 in FY23. This performance leaves the total installed base at 8.801 million, missing previous forecasts that targeted a 9.0 million user milestone.

The FY27-FY29 strategy relies on capturing the 15% of Australian households that currently lack any fixed broadband connection. Success depends on an aggressive acceleration in greenfields FTTP take-up and converting users within the fixed wireless footprint.

NBN Co is targeting full cost recovery by FY31 by driving wholesale ARPU higher through customer upsells. The plan uses lower pricing on high-speed tiers to migrate the existing base to premium plans, offsetting the slow pace of new net additions.

Mobile network operators and LEO satellite providers are actively eroding NBN’s brownfields footprint. This competition complicates the goal of connecting the remaining 15% of households that have opted out of fixed-line services to date.

NBN anticipates big lift in NBN connections

Abstract

Key Takeaways

Frequently Asked Questions

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