Julia Gillard’s promise of cheaper broadband on the NBN – no more reliable than her promise of ‘no carbon tax’

The recent release of retail pricing plans on the NBN shows that Julia Gillard’s promise of cheaper broadband on the NBN is no more reliable than her promise that ‘there will be no new carbon tax under a government I lead,’ said Paul Fletcher MP, Federal Member for Bradfield, after raising the issue in the House of Representatives.

“Last year, Julia Gillard told the House:

 ‘…to look at the fact that Australians pay high prices for broadband and to look at the fact that the industry is telling us—and the Tasmanian example bears it out—that by creating a model with retail price competition you get cheaper prices, because that is what competition is all about’ and;

‘And we do not want Australian consumers of broadband services in this country, whether they be business or households, to pay such high prices in world terms.  We have very high broadband prices.  Look at the OECD data and it will tell you Australians are paying top dollar for broadband’ and;

‘Do you want families in your electorate to have the benefit of more competition, better broadband products and lower prices?  Then tick the National Broadband Network,’” said Mr Fletcher.

“But the release of retail pricing packages from internet service providers like Internode last month has showed that this is yet another Gillard promise that will not be met.

“On a like for like comparison of retail prices (that is, Internode’s current pricing for its naked DSL services compared to  its announced pricing of $59.95 per month for the entry level 12 Mbps service over the NBN), there is no evidence of prices falling when the NBN comes along.  Internode charges $59.95 today for an ADSL 2+ ‘naked DSL’ service with a 30 gigabyte download limit (and offering speeds which in many cases will match or even exceed the speed of the entry level NBN product.)   

“Mr Fletcher told the House in his speech on this matter:

‘This left Senator Conroy, the Minister for Broadband, Communications and the Digital Economy, in a bit of a pickle. How was he to reconcile the actual pricing that had been announced and the claims of the Prime Minister last year? His solution was to leap upon some announcements by Exetel and Dodo, two other internet service providers. Exetel put out pricing and Dodo, to use the words in Senator Conroy's media release of 23 July, has 'mooted a sub-$40 price' although we have seen no more than that.’

“Broadband Minister Conroy claimed in his press release on 23 July, quite misleadingly, ‘I have been saying for some time that access prices on the NBN would be comparable to current prices’ – when in fact it is clear that the Gillard Government has claimed that the NBN would bring cheaper broadband prices.

“Broadband Minister Conroy has cited lower prices to be offered by discount operators like Dodo and Exetel – but just as today there is a range of prices with discount operators offering lower headline prices and full service operators charging higher headline prices, that range is likely tomorrow,” said Mr Fletcher

“Conroy has sought to compare today’s full service prices to NBN pricing to be offered by discount operators.  It is not a valid comparison; it is simply an attempt to distract attention from the compelling evidence that Julia Gillard’s promise of lower NBN retail pricing will not be met.”

Media Contact – Georgia-Kate Schubert 02 9465 3950 or 0414 210216