Why the NBN will never be in 100% of homes

Angus Kidman 5 April 2017 NEWS

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2 million activations is a long way from the end of the road.

There are two ways to measure the progress of the National Broadband Network (NBN). The first is to track how many premises it has connected. According to nbn (the company building the NBN, yes it makes no sense), that number was 4 million back in February, and is now closer to 4.5 million. By 2020, the NBN should have connected 8 million premises, covering most of Australia.

The second measure is how many people have actually signed up for the service. A press release today issued by nbn says that there have now been 2 million activations. That's good news for anyone who has now got a faster connection, but it also means that half the people who could connect to the NBN haven't bothered yet.

Here's the number of activated connections in each state:

StateActive end users
ACT43,929
NSW637,871
NT45,168
QLD397,150
SA144,766
TAS115,927
VIC429,227
WA190,006
Total2,004,044

The activation figure will never be 100%, even after 2020. There will always be people who simply don't think they need an internet connection, or who are happy just to use mobile broadband. There will always be cheapskate landlords who try to fob connection costs on their tenants. There will be apartment buildings that connect to private fibre networks rather than the NBN.

But there will also be an increasing amount of wailing as existing broadband services get switched off. In most cases, 18 months after the NBN becomes available in an area, the existing network (be that copper telephone or HFC cable) is deactivated. That's something which many Australians simply don't understand. A recent finder.com.au survey found that 37% of Australians have no idea about the NBN. Just 28% plan to switch to an NBN service as soon as it becomes available in their area.

That doesn't necessarily mean that only the digitally savvy can play. Roy Morgan figures suggest that 11% of people who have got an NBN service did not have any form of Internet connection at home before getting the NBN. I'd suspect those figures largely come from households where the NBN meant the existing phone service was being switched off. But whether that will play out on a larger scale, or whether some people will decide a mobile phone is enough, remains to be seen.

As I noted yesterday, the NBN rollout is suffering from some glitches, particularly with "difficult-to-service" premises. Having 2 million houses actually using the service is impressive. Having 8 million is never going to happen. But until we get somewhere around the 7.5 million mark, we can't say the NBN is delivering its full potential.

Angus Kidman's Findings column looks at new developments and research that help you save money, make wise decisions and enjoy your life more. It appears Monday through Friday on finder.com.au.

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