NBN CEO: ISPs are to blame for dissatisfaction

Bill Morrow, CEO of Australia’s NBN, has placed the blame on ISPs for customer dissatisfaction.

The NBN (National Broadband Network) was designed to improve the nation’s connectivity and ensure Australia has the required infrastructure for businesses and consumers to embrace the digital future. Over half the country is now able to connect to the NBN, and it has over 2.2 million paying customers, but not everyone is happy.

ISPs are ‘cutting corners’ by not buying enough bandwidth

15 percent of customers who are connected to the NBN are disappointed with their broadband speeds. Morrow has acknowledged this, but is putting the blame on Australia’s ISPs for the current dissatisfaction.

The main issue, he claims, is the ‘price war’ between ISPs. In a position paper (PDF) on the NBN website, Morrow says ISPs are undertaking a ‘land grab’ to sign up customers before rivals without consideration for whether they’ll be able to deliver the speeds they’re promised.

“We have a land-grab environment where retail prices are lower than what consumers are willing to pay,” explains Morrow. “The large number of competitors going after the same customer has driven price to be the key attraction and seldom do you see any clarity around speed options or quality during the peak time of day.”

Multiple studies indicate consumers are willing to pay a bit more for a better service. Many ISPs are promising similar performance as their rivals at competitive pricing but delivering below expectations. Morrow claims the ISPs are ‘cutting corners’ by not buying enough bandwidth from the NBN to deal with the increasing network congestion.

In order to help tackle NBN disappointment, Australian watchdog ACCC is now threatening ISPs with legal action if they fail to deliver advertised broadband speeds to consumers. The ACCC asked for 2,000 volunteers last month to allow the watchdog to monitor their broadband speeds as part of this investigation.

Do you agree with Morrow’s comments? Share your thoughts in the comments.

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