Broadband Briefing: Real NBN pricing doesn't match Gillard government claims

Following the release of proposed NBN retail pricing by major internet service provider Internode, the Gillard government has been exposed for overpromising on NBN pricing.

When Julia Gillard announced her deal with the Independents on 7 September 2010, she claimed that the NBN was going to ‘end the difference in price for regional Australia’:

"We will also ensure that the National Broadband Network offers the benefit of uniform wholesale prices to end the difficulties with telecommunications and difference in price for regional Australia, and we will ensure that priority is given to regional Australia as the NBN is built.”

But last week respected Internode CEO and Australian internet industry pioneer Simon Hackett warned that the NBN’s wholesale pricing construct would not allow for uniform retail costs:

“…the higher regional costs will naturally flow through to regionally specific higher retail pricing for consumers and/or to the abandonment of servicing those higher cost regional areas at all.”

Hackett was writing in a blog after his company had released its planned retail pricing – that is, after detailed operational consideration by a large, experienced internet service provider about the prices that they would actually be able to offer based upon the NBN’s wholesale prices.

The response from the office of Broadband Minister Stephen Conroy was that the government has guaranteed uniform wholesale pricing across the country, not uniform retail pricing.

The niceties of the difference between uniform wholesale and uniform retail pricing will be lost on most Australians.

They will just see that Julia Gillard has been at it again: to get into government she was happy to give the impression that she would end the difference in price for regional Australia; but now her government is saying they never promised that.