In a little over three weeks the NBN Co’s extended offer of increased data capacity to network providers is coming to an end. In the face of a second peak and the likelihood of rolling stay-at-home orders the likelihood is that the NBN will continue to see the greatly increased demand on their network.
To understand this you need a basic understanding of one of the ways the Retail Service Providers (ie you service provider) are required to pay for a Connectivity Virtual Circuit (CVC). This controversial charge is the maximum traffic that a RSP is allowed to have at any point in time.
This means if your IPS does not purchase enough maximum bandwidth then your speeds will drop during peak times. Peak times like we are experiencing now where the NBN is reporting new records for peak data demand on a regular basis.
To help deal with the increased bandwidth required to assist with all of the increased home data usage from COVID-19 the NBN had provided each RSP 40% additional capacity for free as well as increasing data download limits by 40% for customers connected to Sky Muster. This additional data allowed ISPs to maintain services and not increase costs.
If the NBN does not grant another extension and the predictions that increased working from home and potential stay a home orders continue then ISPs will have to either buy more capacity, which they will then charge users for, or throttle connections during peak periods.
You won’t be surprised that the NBN is the only company on the planet that we are aware of that uses this method of billing. Australia ISPs have long been advocating for a system where access charges are related to the peak speeds purchased by users instead of a ‘virtual’ cap.
While we are relatively confident that the NBN Co will continue to extend their offers during COVID-19 there are predictions that traffic will never return to normal. If that happens and the CVC costing method remains you can expect to pay more or get slower speeds in the future.