In something of a surprise at last night’s Senate Environment and Communications Legislation Committee Estimates hearing, it was revealed that a much higher than expected number of initial NBN users a choosing the higher speed plans available on the fibre network.
Both NBN Co CEO Mike Quigley, and Jim Hassell – (Head of Product Development and Industry Relations) – stated that within the current population of fibre users, only 18% have chosen the basic 12/1Mbps option – with 35%, 10%, and 37% uptake rates for the 25/10Mbps, 50/20Mbps, and 100/40Mbps speed tiers respectively.
Hassell stated in the hearing:
“In the 2010 corporate plan our assumptions were that the 12:1 service would be something like about 53 or 54 per cent.”
With the higher prices NBN Co charges ISPs to provide the faster speed tiers to their customers, the potential revenues the network will generate will be much greater than first anticipated.
As Greens Senator Scott Ludlam commented towards Quigley and Hassell during the Estimates hearing, with respect to if such uptake rates of the higher speeds were to continue:
“If they do you are running a much more lucrative business than the minister was hoping you would.”
NBN Co initially projected around 50% of connections would be at the slowest 12/1Mbps tier. 82% of current NBN fibre users are shying away from the basic speed plans.
The indications are clear that more people are favouring – (and likely to continue to favour) – the higher speed tiers as people connect to the network over and above original expectations, and this is expected to be reflected favourably within an updated NBN Co business plan, due to be released before the end of May.
These results, though still early, are very positive news indeed.