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Smaller Telcos Increase Broadband Market Share

Smaller broadband providers increased their market share in the NBN wholesale market in the June quarter 2022, and a record number of telcos now have their networks connected to the NBN at all of the available physical locations, 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 June quarter, smaller retail service providers continued the steady increase in their market share in the wholesale market at the expense of the top four providers, increasing by 0.8 percentage points (with 77,758 additional services) to 12.6 percent. In the June quarter 2021, their combined market share was 8.2 percent.

This growth was led by Aussie Broadband, which increased its market share to 6.4 percent (up 0.3 percentage points).

Wholesale market shares declined slightly for the established providers, Telstra (down 0.4 percentage points to 43.3 percent), TPG (down 0.2 percentage points to 23.1 percent), Optus (down 0.1 percentage points to 13.8 percent), and Vocus which is the fourth-largest telco (down 0.1 percentage points to 7.2 percent).

“The growth of smaller providers is increasing the competitive tension in broadband markets, and many Australians will see the benefit of that,” ACCC Commissioner Anna Brakey said.

“Consumers have a wide range of choice for their broadband retailer, which enables them to choose the product that best suits them.”

The report also shows that broadband providers expanded their presence at NBN’s 121 Points of Interconnection (POIs), which are the physical locations where providers can connect to the NBN.

In the June quarter there were at least 17 providers directly acquiring NBN services at all 121 of the POIs, compared to 13 providers in the March quarter.

“More providers connected at all of the Points of Interconnection means consumers will have a wider range of broadband providers to choose from, no matter where they live,” Ms Brakey said.

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

In June 2022, the 50Mbps service was the preferred speed tier for 55 percent of Australians, down from 58 percent in the March quarter.

“The popularity of the higher speed tiers means that retail competition for these customers is strong, so we recommend that consumers regularly check for new offers or newly discounted deals,” Ms Brakey said.

Retail service providers acquired slightly more Connectivity Virtual Circuit (bandwidth) capacity over the June quarter. Average capacity acquired per user increased from 2.76Mbps in the March quarter to 2.84Mbps in the June quarter.

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


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