NBN Co expects to sustain some of its traffic uplift

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NBN Co expects to sustain some of its traffic uplift

More evidence that bandwidth bonuses might be hard to unwind.

NBN Co is expecting to sustain some of the uplift in the amount of traffic running across its network post-COVID, a prediction that could make it harder for the company to completely wind back bandwidth bonuses laid on since March.

The network builder and operator has provided retail service providers (RSPs) up to 40 percent more bandwidth over their February consumption levels for free to cope with traffic growth due to the pandemic.

The company is under political and industry pressure not to fully unwind the bonus, especially as NBN Co’s own research suggests bandwidth-hungry habits developed during COVID-19 are likely to continue once the bonuses are meant to expire in August.

Speaking to a leadership forum run by The West Australian newspaper, NBN Co CEO Stephen Rue suggested the pandemic would result in sustained traffic growth above the 25 percent year-on-year that NBN Co has seen in the past.

Rue made the comments on traffic growth as an illustration of why he believes having an NBN connection will remain relevant in the 5G age.

“What we’ve seen in recent years has been … about 25 percent data growth per annum on the [NBN],” Rue said.

“Indeed, I think that this pandemic that we've just lived through will actually accelerate the growth of that traffic carried over networks, so that's another way of saying that I think that 5G and NBN will live alongside each other. 

“They will serve different needs for different parts of the community. Our network will become increasingly important for all the reasons I laid out with the change in the way people work, with the change of the way people get educated [and] the changes in the way that people will do their healthcare.

“As a result of that, I think we're going to see increasing amounts of data carried over our network. As a result of that, people will need an NBN service. 

“People will also use a 5G service for different needs … but I firmly believe that the two networks - NBN and 5G - will very much complement each other.”

Rue appears to still be banking on 5G plans coming with substantially less data quota than NBN plans.

However, his commentary around elevated projections of data growth is also likely to renew pressure on the company not to withdraw a bandwidth bonus that prevented a performance bottleneck on the NBN when traffic suddenly shot up due to the pandemic.

At the very least, it provides a case to maintain at least some of the bandwidth bonus rather than wind it back in full.

Rue also touched on the subject of what NBN Co will do once the volume build is complete, though he skirted a question on what role he might have in setting the company up for privatisation.

He said the company planned to continue to build on the network, though offered nothing concrete in that regard.

“As I often say to my team, the completion of the build is just the beginning,” he said.

“There are bright years ahead of Australia and I think that we at NBN Co are going to be absolutely central to that. 

“We will continue to improve our network, we will continue to invest in our network, we'll continue to invest in customer experience, we will continue to work and ensure our network is secure and resilient.

“Over the next couple of years, we turn to a phase where we are cash flow positive, and we will continue to invest those funds into the network to make it better and better, so our network will continue to evolve.”

Rue further predicted around one million more users would sign up to the NBN over the next year.

“At the moment we've got 7.2 million people connected on the network and we're going to see well over 8 million people on the network in the next year alone,” he said. 

“I'm sure we'll be connecting almost a million customers onto the network.”

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