Vodafone unveils NBN plans

Vodafone Australia has announced its National Broadband Network (NBN) plans and inclusions ahead of an internal trial across 300 premises and an initial launch later this year.

“We’re in the final stages of testing our network now; we’ve built it all, so we’re in the process of making sure it’s all hunky dory and we’ll be shortly starting an internal trial and a friendly customer trial of around 300 customers,” Vodafone general manager of Fixed Broadband Matthew Lobb told ZDNet.

“If things go well — and that’s very much to get feedback making sure that we’ve got everything sorted, which we’re confident we are — then we’ll quickly move to rolling out and launching initially in Sydney, Canberra, Melbourne, Geelong, Newcastle, and Wollongong.”

Vodafone’s three plans — “essential” NBN 25, “essential plus” NBN 50, and “premium” NBN 100 on NBN’s three main speed tiers — include unlimited data in addition to bonus mobile data for post-paid customers and its 30-day network satisfaction guarantee.

NBN is also offering what it calls the “basic” service of 12/1Mbps, although Lobb said the company “won’t be actively selling it”.

Under Vodafone’s home broadband pricing, it will cost consumers AU$70 per month for 12Mbps download speeds; AU$80 for 25Mbps; AU$95 for 50Mbps; and AU$110 for 100Mbps, with all options available in 24-month and month-to-month options.

Business plans will cost AU$80 for 25Mbps; AU$95 for 50Mbps; and AU$110 for 100Mbps.

The network will be launched across NBN’s fixed-line networks “really soon”, with fixed-wireless rolling out in the new year, Lobb told ZDNet.

“We’re predominantly a metropolitan business and a major regional centre telco, so that will be our focus,” he explained.

“As we grow and our capability increases, we will be rolling out [further].”

According to Lobb, Vodafone has seen a good response to its request for expressions of interest from both existing and new customers, with a “significant increase” in EOIs after Vodafone announced the Wi-Fi Hub — which will provide backup 4G internet access in the event of an outage or delay in migration — last month.

Three months of free NBN access will be offered to those who submit expressions of interest in return for providing Vodafone with feedback on its service.

As outlined in the ACCC’s guidelines yesterday, telcos “haven’t adequately worked out” how to move consumers onto plans that meet their promises, Lobb added, so Vodafone will also be conducting speed checks within 15 days of a connection to ensure that customers are getting the speeds they’re paying for.

Consumers are also being shifted by incumbents onto plans that do not suit their needs, so Vodafone will be recommending plans suited to what each customer uses the internet for, based, for instance, on how many devices households have and whether they use their broadband for streaming.

Vodafone’s NBN customers will be permitted to make a speed tier switch each month free of charge in order to try out different tiers.

“[NBN’s] key innovation is that customers for the first time can choose the speed tier, and this is something that the market isn’t selling particularly well, and we do want to give customers a clear understanding of what the choices are,” he told ZDNet.

“We think offering the chance to try it out, and if they don’t think they need it, to move back down — we think that reassurance that they can try it is something the customers want.”

Once again referring to connectivity virtual circuit (CVC) pricing as a “speed tax”, Lobb said as usage goes up, the industry’s margins are getting squeezed, resulting in a disincentive to offer higher-speed plans to consumers.

“We understand also that the NBN needs to pay for its costs and they need to get a rate of return, so we think the solution is what we call a rebalance between the AVC [access virtual circuit] and CVC so that AVC prices will go up a bit, but CVC prices will come down, and that will mean that there will be less risk in offering the higher-speed plans and that will create a dynamic where the market will move to be selling the faster-speed services.”

NBN CEO Bill Morrow last week told ZDNet that Vodafone is not asking for a price reduction in accessing the wholesale broadband network.

“Vodafone, they understand this. Vodafone are not asking for a price reduction. Vodafone have their ideas around maybe a higher AVC and a lower CVC, and we’ve asked their opinion for that — that’s no problem,” Morrow told ZDNet.

“There’s a lot of retailers that are reselling NBN products … and some of them have come in knowing what the prices are but are now asking for the prices to be reduced. It’s not Vodafone that’s doing that; I’m referring to others.”

Vodafone announced in October last year that it would be entering the NBN market as a retail service provider before the end of 2017, with CEO Inaki Berroeta saying the telco intends to be “the cornerstone of competition” in fixed-line broadband.

Despite its newly unveiled offerings including the lower speed tiers, Vodafone had previously argued that 12Mbps and 25Mbps should not even be offered on the NBN.

“Given taxpayers have funded a network which has been dimensioned to deliver speeds significantly faster than DSL, it is not clear that these low-speed tiers should even be on offer,” Vodafone argued in its submission to the Joint Standing Committee on the NBN.

“Since the majority of the costs of a fixed-line network are ‘fixed costs’ (ie, do not vary according to capacity or usage), once the NBN network is rolled out, there are only relatively modest additional costs to the NBN to offer higher speeds.”