news National broadband provider Exetel has radically slashed the number of National Broadband Network plans it offers customers, as well as cutting prices and limiting the total monthly download quota on any plan to 150GB.
The company first published commercial prices for NBN services in late July last year. At the time, its prices were seen as significantly undercutting the only other major ISP at the time to have released NBN pricing, Internode. Exetel’s prices started at $34.50 a month and topped out at $99.50. At the time, Exetel’s download quota inclusions were pretty small compared to many current ADSL broadband plans — with the company offering only 200GB in total downloads on its top plans.
However, in plan changes quietly released this week, Exetel has cut its prices and available download quotas even further, as well as eliminating a number of plans completely. With its new plan structure, Exetel only offers between one and three options for each of the four tiers of download speeds (12Mbps, 25Mbps, 50Mbps and 100Mbps) which the NBN allows, as well as an additional two plans for a 25Mbps plan with higher upload speeds (10Mbps).
In general, all of the plans have received price cuts. At the low end, the cuts aren’t that significant — taking a 12Mbps 50GB plan from $39.50 a month to $35, for example. However, at Exetel’s top-end, the price cuts are significant. For example, a 100Mbps 150GB plan used to cost $89.50 a month, but will now cost just $60 a month, amounting to a minimum total cost saving of $474 over a year.
However, many customers will not be happy with the total download quotas which Exetel is offering customers. The company previously offered a 200GB download quota on its top plans, but it has simply deleted that tier of its pricing plans, with customers now being offered a maximum of 150GB quota per month. Customers who exceed their quota each month will have their connections shaped to 1Mbps speeds — which can be as slow as 1 percent of their normal speeds, if they’re on a 100Mbps plan. That limit will apply until the customers’ next monthly billing cycle commences.
The limitation comes in stark contrast to plans offered by other ISPs, with Internode, iiNet and Optus all offering terabyte packages and other tiers with multiple hundreds of gigabytes of download quota. It’s common now for ISPs even when it comes to ADSL or HFC cable broadband to offer plans with several hundred gigabytes for prices under $100. iiNet, for example, offers a 100Mbps NBN plan with a download quota of 500GB on- and 500GB off-peak.
It appears as if Exetel may have also recently chopped its normal ADSL broadband offerings, with the company’s site currently listing only two ADSL2+ broadband plans — at $39.50 and $49.50 monthly price points, and with 50GB and 200GB of quota respectively.
There are several noteworthy aspects to Exetel’s plan changes unveiled this week.
Firstly, they represent the fact that Exetel has now completely abandoned the heavy downloader market, in both the ADSL and NBN markets. Put simply, no self-respecting geek would settle for a download quota of just 150GB, when they are able to access NBN speeds. For most households of three to four people, and many solo technical individuals or small businesses, signing up for an NBN plan will necessitate a quota of several hundred gigabytes per month.
At the moment, Exetel is offering higher download quotas on its ADSL services than it is on its NBN plans … which is, quite frankly, ludicrous. Australians will download much, much more than they currently are, when they’re switched onto the NBN. I can only imagine that Exetel is trying right now to avoid high-level or even high mid-level customers and go instead for the entry level and low mid-level broadband market. Perhaps it thinks it can make more profits from that market.
Secondly, the plan changes represent the fact that NBN pricing has again become cheaper than it previously was.
Exetel’s NBN price cuts are the second round of NBN price cuts we’ve seen, after Internode chopped its initial commercial prices last year, to bring them more in line with the market. And that’s just within the past few months since commercial services were first launched on the NBN.
Not only does this — yet again — invalidate the Coalition’s argument that broadband prices will be more expensive on the NBN than in the current ADSL broadband market (how many hits can Malcolm Turnbull and his colleagues take on this issue before they admit they’re wrong?), but it also illustrates that the NBN market will be an extremely dynamic one, with ISPs changing their broadband prices regularly. We have yet to see a better outline of its more stable, eventual shape, and likely won’t for another several years.