NBN affordability a growing issue

The cost of basic NBN plans is becoming an affordability issue for people on lower incomes, according to Australian Competition and Consumer Commission (ACCC) chair Rod Sims.

Speaking at the CommsDay Summit in Sydney, Mr Sims said that NBN plans were now more expensive than what most consumers pay for equivalent ADSL alternatives.

For around $50 per month, a customer could and still can get an ADSL internet and voice plan with a 100 gigabyte (GB) quota, or pay $60 for an unlimited quota plan.

“We are now observing prices of low-speed NBN plans offered to new customers that are at least $10 per month higher than what consumers paid for equivalent ADSL plans,” Mr Sims said.

The ACCC attributes this to new NBN Co wholesale pricing introduced in the past six months.

The wholesale cost of accessing the NBN to supply a basic 12-megabit service has increased substantially and is now close to the cost of a 50-megabit service.

“There is a fundamental question of fairness here for those on low incomes,” Mr Sims said.

The Australian Greens’ digital rights spokesperson Jordon Steele-John addressed this issue last month when launching his party’s policy on the NBN.

“The reality is that Australia is lagging behind the rest of the world when it comes to having access to reliable, affordable and high quality internet services,” Mr Steele-John said.

“Our promise is to make quality telecommunications affordable for all Australians.”

Part of the Greens’ NBN policy platform includes spending $1.3 billion to establish a federal telecommunication concession. That concession would provide $60 a quarter to all holders of a DHS Health Care Card and will replace the limited Telephone Allowance and fund an NBN migration program for vulnerable consumers to help close the digital divide.

Mr Sims also stressed the importance of the ACCC’s current wholesale service standards inquiry, which aims to bring about improvements in the time taken by NBN Co to connect new customers and fix faults, and to keep scheduled appointments or provide compensation for missing appointments.

“If the wholesale standards are high, retail service providers can offer strong service commitments to their customers. However, if any of these activities are not up to scratch, retailers and, more importantly, the consumer will bear the pain,” Mr Sims said.

“We also believe NBN Co’s entry-level services should be anchored to existing ADSL pricing. This is only fair to consumers because they have no choice but to move to the NBN as their existing services are being withdrawn.

“But more importantly, consumers [who] already want the higher speeds that the NBN makes possible also stand to benefit from pricing that reflects the additional value.”

Are you struggling to pay for your NBN service? How much extra does your plan cost than the previous ADSL plan? Are you satisfied with the NBN in your area? Should people on low and fixed incomes like Age Pensioners receive a concession for their internet service?

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