NBN Co releases indicative Pricing Roadmap for FY24-FY26
NBN Co today provided customers and the telecommunications industry with transparency of its proposed wholesale Pricing Roadmap for FY24 – FY26. This will assist interested parties with their assessment of NBN Co’s proposed variation to its Special Access Undertaking (SAU Variation) following the release of the ACCC’s Draft Decision on 2 May 2023.
NBN Co’s SAU Variation proposal commits NBN Co to publishing a new three-year rolling Pricing Roadmap by 1 May every year. The Pricing Roadmap for the next three fiscal years indicates that the total weighted average basket of nbn wholesale prices will be within inflation forecasts. The Pricing Roadmap will be finalised subject to the Australian Competition and Consumer Commission’s (ACCC) acceptance of a revised SAU Variation, which the company is planning to lodge in June 2023.
NBN Co reaffirmed its plans to remove CVC (capacity) charges and deliver flat rate wholesale pricing for its highest speed products, including nbn Home Fast, nbn Home Superfast and nbn Home Ultrafast.
The company’s planned prices for FY24 are in line with those it put forward as part of its SAU Variation lodged with the ACCC in November 2022.
In accordance with the Weighted Average Price Control (WAPC) that forms part of the revised SAU Variation, which will govern the average price increases permitted in future, and individual price controls, which restrict the company to increase individual wholesale prices by the greater of CPI or up to a cap of 5 per cent per annum, the company is planning to index its total weighted average basket of wholesale prices to within inflation in FY251 and FY261.
The Pricing Roadmap released today is draft and indicative only for FY25 and FY26 and is based on the Reserve Bank of Australia’s (RBA) published forecasts in February 2023 for inflation in these outer years.
NBN Co has applied an RBA-forecast2 CPI of 4.8 per cent in FY25 and 3.2 per cent in FY26. The company estimates the overall price increases across the total set of nbn products covered by the WAPC will be approximately 4.6 per cent in FY25 and approximately 3.0 per cent in FY26.
In FY25 and FY26, indicative wholesale prices in the Pricing Roadmap for NBN Co’s entry level 12/1 Mbps, 25/5 Mbps and 25/10 Mbps products (excluding satellite services) are indexed to inflation, while the nbn 50/20 Mbps and nbn Home Fast 100/20 Mbps speed tiers are each increased by 5 per cent in FY25 and 3.2 per cent in FY26.
The indicative wholesale price in the Pricing Roadmap of the nbn Home Superfast 250/25 Mbps speed tier increases by 4.6 per cent in FY25 and 2.9 per cent in FY26, while the indicative wholesale price of the nbn Home Ultrafast speed tier, which offers wholesale download speeds to 500 Mbps to close to 1 Gbps and wholesale upload speeds of up to 50 Mbps, increases by 3.9 per cent in FY25 and 2.5 per cent in FY26.
The indicative wholesale prices in the Pricing Roadmap for nbn Sky Muster and Sky Muster Plus satellite services are unchanged in FY25 and FY26.
Full details of NBN Co’s draft three-year Pricing Roadmap are available here.
Notes to editors:
1 The prices and CVC inclusions and forecast average combined charges for FY25 and FY26 are indicative and non-binding, subject to the application of the TC-4 Relativity Restriction in the proposed SAU Variation.
2 In developing this draft Pricing Roadmap, NBN Co has relied on Consumer Price Index (CPI) forecasts in the Statement of Monetary Policy published by the Reserve Bank of Australia (RBA) in February 2023. Specifically, the forecast annual percentage change in CPI used to inform NBN Co’s expectations of the application of the price controls under the revised SAU is 4.8 per cent in December 2023 and 3.2 per cent in December 2024. NBN Co notes that the prices in the Pricing Roadmap for FY25 and FY26 are indicative and that the SAU price controls which apply to the Tariff List published for those financial years will be based on the actual annual percentage change in CPI published for the December quarter before the relevant financial year.