Telstra, TPG and Optus lose wholesale market share for NBN services to smaller providers

ACCC

Smaller broadband providers slightly increased their market share in the NBN wholesale market in the March 2022 quarter at the expense of the three major telcos, the ACCC’s latest NBN Wholesale Market Indicators Report reveals.

The report looks at the wholesale market for NBN services, particularly the residential broadband services that retailers buy from NBN to sell to consumers.

In the first three months of this year, wholesale market shares declined slightly for Telstra (down 0.3 percentage points to 43.7 per cent), TPG (down 0.3 percentage points to 23.3 per cent) and Optus (down 0.3 percentage points to 13.9 per cent). Vocus, the fourth-largest telco whose brands include Commander and Dodo, remained steady at 7.3 per cent.

In contrast, the combined market share of all other retail service providers increased by almost one percentage point (84,414 additional services) to 11.8 per cent. This growth was led by Aussie Broadband, which increased its market share to 6.1 per cent (up 0.5 percentage points).

“The smaller internet providers are growing, and in doing so they are increasing competition in the residential broadband market,” ACCC Commissioner Anna Brakey said.

“The presence of smaller players with competitive offers is keeping the larger providers on their toes.”

The report also shows that nearly 8.7 million residential broadband services are now on the NBN, and almost three-quarters of those are high speed plans of at least 50 Mbps or more.

As the ‘Focus on Fast’ promotional discounts have now ended, the number of very high speed services over 100 Mbps fell by around 140,000 services, or by 40 per cent, in the March 2022 quarter. However, there are still more than eight times as many very high speed services connected to the NBN than in late-2020 when the promotion began.

In March 2022, the 50 Mbps service was the preferred speed tier for 58 per cent of consumers.

“We always encourage consumers and small businesses to explore their broadband internet options and find the NBN speed tier that is right for them,” Ms Brakey said.

“Not all consumers need a very high speed service, and some may not even notice the difference at the top end of speeds.”

Retail service providers acquired slightly more Connectivity Virtual Circuit (bandwidth) capacity over the March quarter. Average capacity acquired per user increased from 2.73 Mbps in the December 2021 quarter to 2.76 Mbps in March 2022.

Broadband providers expanded their presence at NBN’s 121 Points of Interconnect (POIs), which are the physical locations where providers can connect to the NBN.

In the March quarter there were at least 13 providers directly acquiring NBN services at 121 of the POIs, and 15 directly connected at 115 of the POIs.

“Retail providers expanding their POI footprints across Australia means greater choice of internet providers for more consumers, and that’s a good thing,” Ms Brakey said.

Further information, including time series data, is available on the ACCC website at NBN Wholesale Market Indicators Report.

Background

The ACCC’s NBN Wholesale Market Indicators Report contains information on NBN Co’s provision of wholesale services to retail service providers. It does not report on the services supplied by retail service providers to end users. Retail service information is available via the ACCC’s Internet Activity RKR report.

Retail service providers use the NBN’s wholesale access service to supply retail services to their own customers or, alternatively, to supply a wholesale service to another (usually smaller) retail service provider.

Most small retail service providers do not directly connect with NBN Co, instead reselling services that they buy from larger providers such as Telstra, TPG and Optus.

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