nbn™ sweetens the deal for business and its own bottom line

Mirrors price relief offered to consumer market


Updated nbn™, the company building Australia's National Broadband Networ (NBN), has adjusted its wholesale prices so that retailers offering business plans get the same price relief as previously offered for the consumer market.

After many complaints about the cost of its backhaul services (connectivity virtual circuit, or CVC), nbn™ introduced a usage-based discount in April 2016, and in January this year followed that up with a new CVC pricing model.

Today, the company announced similar relief in the business market, saying that from October 2017 a spend cap will apply to its high-bandwidth business products.

The changes apply to its business-targeted Traffic Class 2 (TC2) service. TC2 offers the kinds of service guarantees business customers get from non-NBN providers, including committed information rate (instead of the maybe-megabits-per-second consumer speeds that so frustrate customers and regulators alike), and limits on latency, jitter, and packet loss.

The company's announcement says the new price book is designed to make business services more appealing to organisations in the 20-200 staff range.

Business services are important to nbn™'s future financials, as a way to help the company expand its Average Revenue Per User (ARPU). Currently hovering around the AU$43 per month mark, the company wants ARPU to approach $50 per month. Consumers alone can't delive that increase.

As part of the change, nbn™ says the new prices will “replace the nbn™ Business Ethernet (nBE) product that was previously scheduled to launch later this year”.

The Register has asked the company whether that suggests any changes other than pricing to the business product. We will provide an update if we receive a response. ®

Update: nbn™ has explained the change to its former business Ethernet product: "nBE was a new product concept that would have provided a single price per service. The service would have been uncontended (Traffic Class 2) with enhanced Service Level Agreements (eSLAs).

"The spend cap will provide a wholesale cap on nbn's existing Traffic Class 2 service, while providing RSPs the flexibility to manage their own contention and add eSLAs where appropriate."

There's an important point here: while retailers will be able to offer an uncontested business server, they can also create services with other contention ratios, still using the same wholesale service.

+Comment: We won't see the details of the new price book until the changes are launched, but nbn™ told industry newsletter Communications Day that discounts will range from 20 per cent to 70 per cent from lowest to highest bandwidth orders.

A glance at nbn™'s current price list (available here), that will still amount to a hefty premium for businesses.

A CVC of 500 Mbps – enough to support ten 50 Mbps committed access connections, which themselves cost $320 per month – currently costs retailers $8,750 per month.

Depending on the retailer's volume, that could be discounted to between $2,625 and $7,000 per month, or $262.50 to $700 per customer, per month.

These prices are wonderful, from the ARPU point of view – but whether they're attractive business services is another matter. Let's take the best case as an example: will businesses pay more than $500 per month for a 50 Mbps service?

That's attractive at the larger end of the market, but less so for a 20-seat business.

The problem for nbn™ is that Australian businesses skew small. The Australian Bureau of Statistics found nearly 200,000 businesses with 5-20 staff, compared to just over 50,000 in nbn™'s target 20-199 band, and only 3,800 with 200 or more staff in February 2017 Counts of Australian Businesses. There's no data on the typical size of those 20-199-seat-organisations, but Vulture South expects most will be a the smaller end of that range and find $5,000/month for broadband less-than-appetising, although if retail service providers bundle well the pain may ease. ®


Other stories you might like

  • DigitalOcean sets sail for serverless seas with Functions feature
    Might be something for those who find AWS, Azure, GCP overly complex

    DigitalOcean dipped its toes in the serverless seas Tuesday with the launch of a Functions service it's positioning as a developer-friendly alternative to Amazon Web Services Lambda, Microsoft Azure Functions, and Google Cloud Functions.

    The platform enables developers to deploy blocks or snippets of code without concern for the underlying infrastructure, hence the name serverless. However, according to DigitalOcean Chief Product Officer Gabe Monroy, most serverless platforms are challenging to use and require developers to rewrite their apps for the new architecture. The ultimate goal being to structure, or restructure, an application into bits of code that only run when events occur, without having to provision servers and stand up and leave running a full stack.

    "Competing solutions are not doing a great job at meeting developers where they are with workloads that are already running today," Monroy told The Register.

    Continue reading
  • Patch now: Zoom chat messages can infect PCs, Macs, phones with malware
    Google Project Zero blows lid off bug involving that old chestnut: XML parsing

    Zoom has fixed a security flaw in its video-conferencing software that a miscreant could exploit with chat messages to potentially execute malicious code on a victim's device.

    The bug, tracked as CVE-2022-22787, received a CVSS severity score of 5.9 out of 10, making it a medium-severity vulnerability. It affects Zoom Client for Meetings running on Android, iOS, Linux, macOS and Windows systems before version 5.10.0, and users should download the latest version of the software to protect against this arbitrary remote-code-execution vulnerability.

    The upshot is that someone who can send you chat messages could cause your vulnerable Zoom client app to install malicious code, such as malware and spyware, from an arbitrary server. Exploiting this is a bit involved, so crooks may not jump on it, but you should still update your app.

    Continue reading
  • Google says it would release its photorealistic DALL-E 2 rival – but this AI is too prejudiced for you to use
    It has this weird habit of drawing stereotyped White people, team admit

    DALL·E 2 may have to cede its throne as the most impressive image-generating AI to Google, which has revealed its own text-to-image model called Imagen.

    Like OpenAI's DALL·E 2, Google's system outputs images of stuff based on written prompts from users. Ask it for a vulture flying off with a laptop in its claws and you'll perhaps get just that, all generated on the fly.

    A quick glance at Imagen's website shows off some of the pictures it's created (and Google has carefully curated), such as a blue jay perched on a pile of macarons, a robot couple enjoying wine in front of the Eiffel Tower, or Imagen's own name sprouting from a book. According to the team, "human raters exceedingly prefer Imagen over all other models in both image-text alignment and image fidelity," but they would say that, wouldn't they.

    Continue reading
  • Facebook opens political ad data vaults to researchers
    Facebook builds FORT to protect against onslaught of regulation, investigation

    Meta's ad transparency tools will soon reveal another treasure trove of data: advertiser targeting choices for political, election-related, and social issue spots.

    Meta said it plans to add the targeting data into its Facebook Open Research and Transparency (FORT) environment for academic researchers at the end of May.

    The move comes a day after Meta's reputation as a bad data custodian resurfaced with news of a lawsuit filed in Washington DC against CEO Mark Zuckerberg. Yesterday's filing alleges Zuckerberg built a company culture of mishandling data, leading directly to the Cambridge Analytica scandal. The suit seeks to hold Zuckerberg responsible for the incident, which saw millions of users' data harvested and used to influence the 2020 US presidential election.

    Continue reading
  • Toyota cuts vehicle production over global chip shortage
    Just as Samsung pledges to invest $360b to shore up next-gen industries

    Toyota is to slash global production of motor vehicles due to the semiconductor shortage. The news comes as Samsung pledges to invest about $360 billion over the next five years to bolster chip production, along with other strategic sectors.

    In a statement, Toyota said it has had to lower the production schedule by tens of thousands of units globally from the numbers it provided to suppliers at the beginning of the year.

    "The shortage of semiconductors, spread of COVID-19 and other factors are making it difficult to look ahead, but we will continue to make every effort possible to deliver as many vehicles to our customers at the earliest date," the company said.

    Continue reading

Biting the hand that feeds IT © 1998–2022