NBN Co sees influx of customers into residential gigabit tier

NBN Co has seen its largest quarterly increase in residential subscribers to gigabit services since a ‘try before you buy’ promotion it ran three years ago.

The company grew its ‘home ultrafast’ services in operation by 23,795 in the first three months of 2024, to reach a total base of 137,944.

Home ultrafast is the marketing name NBN Co uses to describe its residential ‘up to gigabit’ service offering.

The increase builds on a 22,818 rise in the three months to December 31 and means that total residential gigabit services in operation are up 50 percent in just six months.

Notably, the increases are the largest for three years. Back then, NBN Co ran a ‘try before you buy’ promotion called 'Focus on Fast', where customers paying for 100Mbps services could try 250Mbps or gigabit services for free for six months.

The promotion led to mass upgrades to the gigabit tier - from 9924 to 82,918 active services in a single quarter. 

When the promotion ended, some 33,000 customers elected to stay on gigabit speeds and pay the price difference.

Since that time, numbers of gigabit users on the network have risen steadily, but the biggest increases have come in the past nine months - 14,095, 22,818 and now 23,975.

The uptick coincides with a stabilisation in NBN Co’s ‘fibre connect’ program, which is allowing some customers with fibre-to-the-node (FTTN) or fibre-to-the-curb (FTTC) to upgrade to full fibre connections, allowing them to access faster services.

iTnews reported earlier this month that the company completed 100,000 connections under the program over the first 17 weeks of the year, to reach a total of 300,000 upgrades performed so far.

Price is also likely to be a factor: NBN Co said late last year that the effect of its special access undertaking (SAU) agreed with regulators is a $10 a month reduction in the wholesale charge for the ultrafast plan.

Since the SAU was approved, challenger retail service providers (RSPs) in particular have taken an aggressive stance with retail pricing.

Aussie Broadband has the largest number of gigabit residential users at 52,251, followed by Superloop (31,203) and TPG Internet (20,721).

A different set of figures in March showed that the performance of gigabit services is also less variable since NBN Co stopped levying a separate bandwidth charge on them.

Ultrafast services could receive a further boost in future with a change being contemplated to double the upload speed, from the current 50Mbps to 100Mbps.

It isn’t just gigabit services that have benefitted from the improved wholesale pricing and increase in the size of the fibre footprint.

In the past three months, the number of active 250Mbps connections rose by 23,663 while the number of 100Mbps connections increased 96,999.

An NBN Co spokesperson told iTnews the company has seen "strong demand for full fibre upgrades, particularly since we now have more than 8 million premises throughout all states and territories of Australia that are now eligible to upgrade, and all major retailers are in market."

The spokesperson added that while "the majority" of upgraders chose the 100/20Mbps product, it is "seeing increasing demand" for the 250Mbps and up to gigabit offerings, in line with the quarterly figures.