Finance Consumer Cash in on the NBN ‘price war’

Cash in on the NBN ‘price war’

Experts predict prices will start falling, as they did for mobile plans. Photo: Getty
Twitter Facebook Reddit Pinterest Email

If you are already connected to the NBN but unsatisfied with your current service, now is the time to check you’re getting the best value for money as Australia reaches the peak rollout phase.

Vodafone, which entered the NBN space in December last year, announced on Tuesday it had slashed prices so low, its NBN plans were now among the cheapest on the market.

Veteran telecommunications analyst Paul Budde said this would prompt a “price war”, similar to what has been seen in the mobile market.

“This is great news for consumers,” he told The New Daily.

“This will have a big effect on the market as others will have to follow.”

The major telcos remained tight-lipped when The New Daily asked if they had any immediate plans to reduce the costs of their NBN plans.

How to find the best-value NBN plan

You could be saving about $25 a month and as much as $480 a year by changing your NBN provider, according to new Galaxy research commissioned by Vodafone.

Consider what price points are within your monthly internet budget.

Aussie Broadband offers a competitive $55 plan at the NBN 25 megabits per second (Mbps) tier, while certain Optus mobile customers can get access to NBN 50 Mbps at $65 with Optus.

Vodafone’s new offering prices its NBN 25 Mbps tier at $58 per month, while the 50 and 100 speed tiers are $69 and $89 respectively ($59 and $79 for existing customers).

Telco expert Rob Nicholls said it was important to make sure you are paying for an NBN service that meets your personal internet needs.

“If there are more than a couple of people in the house, then NBN 50 is really the baseline – even for a few people concurrently watching YouTube,” Mr Nicholls said.

“There is little point in going for a plan that is lower than NBN 50 unless you only use the internet for email and very light browsing.

“A household might need NBN 100 if there are multiple people streaming video or gaming simultaneously or if someone works from home. Broadly, any household with more than one person who is a secondary school or university student.”

Once you have determined the best speed tier for you, it would be worthwhile looking at how much value you place on internet speeds.

The consumer watchdog ACCC last week released its speed monitoring report revealed that small homegrown telco Aussie Broadband is providing its customers with the fastest NBN speeds during peak evening times.

Australia’s largest telco Telstra, which boasts “superior network capabilities” and charges consumers a premium for its service, lagged behind, only reaching maximum speeds during the evening 79.9 per cent of the time.

Singapore-based telco MyRepublic was the worst performer, reaching just 74.4 per cent.

Vodafone does not advertise its evening speeds and it told The New Daily it was unable to confirm its maximum average speeds during peak.

Telstra, Optus and iiNet also offer various entertainment bundles.

But … beware exit fees

Mr Nicholls warned that there is little point in switching to a lower-cost provider if the early termination, cancellation or upfront fees outweigh the savings.

“For example, upfront fees for a new Telstra customer are $99,” he said.

“So moving to Telstra to save $5 per month would have a 20-month payback.”

Consumers should be aware that while there is no upfront fee or lock-in contract, Vodafone charges its customers a $180 modem fee if they choose to leave after one month. This cost reduces to $0 if the consumer stays loyal to the telco for three years.

A Telstra spokesman said its NBN satisfaction guarantee allows customers who aren’t happy with their NBN service within 30 days of connecting to leave without penalty. Early termination fees may apply to NBN customers under a contract.

According to Optus, customers who choose to cancel their existing contract may also incur a fee, dependent on their plan, with cancellation fees decreasing during the contract period.

Meanwhile, Aussie Broadband requires 30 days’ notice should a customer wish to terminate their NBN plan. While it doesn’t have lock-in contracts, if a customer has a pre-arranged payment plan, such as to pay off a modem, they would need to pay the remaining sum owed.

View Comments