news National broadband provider iiNet has withdrawn its National Broadband Network satellite plans from sale, as the rapid up-take of customers on the service has resulted in a lack of available network capacity for new sign-ups.
The National Broadband Network Company started providing wholesale access to a nation-wide satellite service from July 2011, following the signing of two deals with satellite providers Optus and IPstar, worth $200 million and $100 million respectively. However, the company is not planning to start operating its own satellites until 2015, delivering significant capacity and speed upgraded.
In a statement issued this morning, iiNet, one of Australia’s largest ISPs and one of the earliest entrants to selling NBN services, said it had been forced to withdraw all NBN Interim Satellite plans from new sale, effective immediately. The decision also means associated brands Westnet and TransACT will cease new sales of all interim NBN satellite services. Existing iiNet Group satellite customers will not be affected by this move and will remain on their current services.
iiNet CEO, Michael Malone, said that, since its introduction 18 months ago, iiNet had witnessed high, ongoing demand for NBN Interim Satellite Services.
“At its peak, we had 500 customers signing up every week for our NBN satellite services. There is clearly a significant demand for higher quality broadband in remote Australia, and we’re absolutely gutted that we’ve had to withdraw this crucial service from sale,” Malone said.
With 42,000 people already connected to the NBN Interim Satellite, transmission capacity constraints are resulting in severe service quality issues. NBN Co, according to iiNet, has ruled out providing more transmission capacity for the existing satellite, which will be replaced with a higher-capacity satellite solution in 2015.
“iiNet is committed to providing high-quality broadband, so in order to meet our own customer service objectives, we could not continue to offer a service markedly below both our own and our customer’s expectations. During occasional peak periods the service was so slow as to be almost unusable,” said Malone. “As more people are added to the network, quality will only decline further. In the absence of any action by NBN Co to increase transmission capacity, I call on the rest of the industry to respect their existing customers and also cease sale.”
iiNet will investigate opportunities to move any of the 8000 existing satellite customers to faster wireless services that are gradually being extended to remote and regional areas by the company’s mobile wholesale partner Optus.
“We recognise that the Federal and State governments are currently funding ‘uneconomic’ mobile networks in regional areas. It would be in the best interest of these isolated communities to ensure open access to this crucial infrastructure – improving services and encouraging competition,” said Malone.
“As soon as NBN Co commissions its new satellites, iiNet will immediately provide higher performance services for all qualifying customers.”
Image credit: NBN Co