news MNF Group (MyNetFone), the provider of hosted voice and data communications services, has hit out at both the Coalition Government and Labor, saying neither has addressed the “inadequacies” of the NBN’s commercial model in their election policies.
Both the Coalition and Labor, the group said, have ignored the NBN’s “flawed commercial model” which is based on a “high-cost usage charge model”.
“MNF believes this legacy model, which is seldom used elsewhere in the world, is causing congestion, instead of as promised, solving the problem,” MyNetFone said in a statement.
Jon Cleaver, MyNetFone’s Group Chief Commercial Officer, said: “Peak hour congestion has been around since the start of the Internet, however just as we thought this was going to be a thing of the past, it is instead going to get worse as you will be impacted not just by your neighbours, but your whole suburb.”
“At the same time this is happening, content has gone through the roof. Everyone is consuming data at the same time and so peak time is no longer just a few hours, but from 5-11pm as everyone is streaming a movie or sport,” he added.
According to Cleaver, Australia’s Internet network is currently working on the same principal as “cars on a highway in congested peak hour traffic”.
“The answer is not increasing the speed limit. That does not reduce the congestion issue. It is about having more lanes,” said the CCO.
“With the NBN, we have those lanes, but commercially they are not being made available. We have the pipes and have spent the money putting in the infrastructure, but we are asking end users to pay a per usage cost when we live in an unlimited world.”
MyNetFone said this “poor user experience” is likely to drive people away from the NBN to alternative providers.
“Given the NBN business model relies on reaching an unrealistic target of 80% of all Australian households having an active NBN service by 2020, to generate sufficient revenue to repay the investment of building the network, this huge future benefit may become a huge future deficit for future generations,” the company said.
Locally, the slow take-up of high-end NBN services has been linked to the company’s pricing structure, with figures such as Stephen Baxter — celebrated entrepreneur and co-founder of fibre telco PIPE Networks — stating their disbelief that the NBN company charged customers more for accessing higher speeds, rather than incentivising them to use the full capacity of the NBN network.
In short, many experts believe Australians would take up the higher NBN speeds in much greater numbers if the NBN company reworked its much-criticised wholesale pricing model.
The issue has also been linked to congestion issues, especially on the new wave of NBN technologies such as Fibre to the Node, with retail telcos such as Telstra and Optus not allocating sufficient backhaul capacity to customers, because of the NBN company’s per-usage model.
No political party has so far addressed these issues in their NBN policy platform.
Image credit: NBN company