NBN Co rollout & ARPU progress: Gary McLaren

*This article republished thanks to Gary McLaren who kindly gave permission. It first appeared on Gary’s blog here 

I have added a new chart this week as an estimate of the revenue impact of NBN Co’s activation rate continuing below its target for since the end of 2017. This graph looks at the the cumulative number of actual premises activated versus the target and then computes a corresponding cumulative revenue position against target. It is based on the ARPU reported by NBN Co each quarter – currently $44 per month.

Rollout Progress as of 24 May 2018

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It started from a net zero position for activations and revenue as of 1 July 2016 (ie. the time span of the graphs).

1At the end of FY2017 NBN Co were approximately break event against target. During the first half of FY 2018 NBN Co was ahead of its target until it started turn in December 2017.  As of the latest report NBN Co has just crossed from positive cumulative revenue against target and on the current trend will have a cumulative of negative $18 million at the end of June 2018.

Please note this is just an estimate to gauge the financial impact of the slowing activation rate on NBN Co’s financials.

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NBN Co Funding from the Australian Taxpayers

With the commercial viability of the NBN Co being called into question and the prospect of a write-down in the Australian Government’s investment becoming more likely, here is an overview of funding provided by Australia’s taxpayers for NBN Co under the different political parties.

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Note : For the election year of 2013/14 the funding has been split 50:50 between Labor and the Coalition.

ARPU Progress as of 31 Mar 2018

NBN Co needs to raise ARPU to $52 per month in order to hit its financial projections by 2020.

The below graphs show the ARPU progress and also the contribution from different technology types (AVC revenue only).

Note : NBN Co released a special promotion offer in December 2017 which sees the 50/20Mbps AVC price reduced to the same as the 25/5Mbps price (ie. $27 per month) on e fixed network technologies.

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