NBN revenue passes $1billion

NBN Co has more than doubled full-year revenue as connections to the national broadband network accelerate but the company acknowledges it must do more to address discontent among consumers.

With 2.4 million homes and businesses now running an active NBN service through a retail service provider such as Telstra or Optus, up from 1.1 million last year, NBN Co on Tuesday said full-year revenue has spiked 138 per cent to $1 billion in the year to June 30.

During the financial year 2.8 million premises were connected to the national broadband network, bringing the total number of NBN-ready Australian premises to 5.7 million.

While the NBN Co passed the ‘half-way built’ mark and grew its national footprint by 122 per cent, chief executive officer Bill Morrow acknowledged that public confusion around NBN activation, speed and pricing continues to impede the use of the national broadband service.

“We know that the number one issue is: “When am I going to get the NBN service?” Mr Morrow said.

Telecommunications expert Paul Budde said Australians can’t afford the highest speeds.

‘NBN Co’s business model is set by the government,’ he said.

‘Instead of rolling out to those who want or can afford a premium service – like a normal commercial enterprise – the company’s objective is to link the entire country like a social-economic investment.’

Mr Budde said the cost of this investment is then borne by retail service providers (RSPs) which are selling broadband.

‘(The RSPs) are burdened by the market reality that $60 to $70 dollars only gets you a second rate service with disappointing speeds,’ he said.

NBN Co chief executive Bill Morrow also admitted the process of transferring customers onto NBN services has not always been user-friendly.

‘We know we have an issue with the activation process for too many end users, we have daily meetings about how that is getting addressed,’ he said.

‘We’re working closely with the RSPs to be able to rectify this and it is the top priority within the company.

‘I believe its going to take us a number of months before we can actually address this adequately.’

He said 75 per cent of users have transferred to the NBN within 18 months of it rolling out in their area, ahead of the company’s target of 74 per cent.

In the 2016/17 financial year, 2.8 million premises were connected to NBN infrastructure, bringing the total to 5.7 million.

The chief executive said the company believes it is addressing that concern, with construction volumes for the period hitting a peak of 140,000 homes made ready for service within a single week.

Total expenses also grew on the back of an expanding workforce, direct network and subscriber costs, up 71 per cent to $3.4 billion, while adjusted EBITDA for the full-year was down 17 per cent to $826 million.



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