Promises from the government that consumers will be able to access the NBN for comparable prices to current day plans are "untenable in practice", internet provider Internode says.
Internode today became the first ISP to reveal retail prices for internet and phone services delivered via the national broadband network. Prices range from $60 to $190 a month.
Customers will have to buy a bundled package that includes both home phone and internet access and the cheapest plan at the slowest speed will be $59.95 for a 12 megabits per second (12 Mbps) connection and 30GB of downloads.
To get the full 100 Mbps speeds promised by the government with a 200GB quota the price rises to $119.95 a month. Boosting the monthly download allowance to 1 TB (1024 GB) costs $189.95.
The monthly cost includes line rental and will be available later this year for people living in sites where NBN Co is testing its new network.
In a blog post accompanying the new prices, Internode chief executive Simon Hackett criticised the competition regulator and NBN Co. He argues the number of connection points in the network will increase costs for smaller carriers, and questions a monthly $20 connection fee imposed on carriers by NBN Co.
"The National Broadband Network (NBN) is the subject of promises from the government that consumers will pay comparable prices to current day ADSL2+ and phone service bundles in order to access entry level NBN based services, and that NBN based retail pricing will be nationally uniform," said Hackett.
"Unfortunately, a number of pressure points in the wholesale pricing model exist which will make these promises (from the government) untenable in practice, unless serious issues with the underlying pricing model are addressed by NBNCo and the ACCC."
Hackett has published a detailed analysis going into the technical specifics about why the government's pricing expectations are unreasonable.
Comment is being sought from the Communications Minister Stephen Conroy.
However, Teresa Corbin, chief executive of the Australian Communications Consumer Action Network (ACCAN), said the prices released by Internode were comparable to today's prices. But people who want higher speeds would have to pay more to get them.
"At first glance for customers who want to have a similar speed and download allowance as they do now – living in a metropolitan area, for example with 12 Mbps – the price for these bundles are comparable to what's available today," she said.
"If you are living in a regional area you will get higher speeds for your money that what would be currently available. The phone line bundled in is going to make it much cheaper for some people."
Internode's general manager of regulatory and corporate affairs, John Lindsay, said the average broadband user currently downloads less than 20 gigbytes per month.
''Thirty gigbytes is significantly more than the 18 gigabytes that the average Internode customer uses a month and is well suited to households with one or two computers and perhaps smartphones or tablet type devices. The rungs above that are more suited to people that have multiple computers or teenagers with computers.''
He said 30 gigabytes is enough to download a couple of movies a week along with music and general surfing.
However, Mr Lindsay said the prices are provisional and could be higher in regional areas.
''As we are obliged in the future to connect at regional points of interconnection, that is likely to drive our costs up and that may result in us having to charge more for the service for people in those regional areas.''
''Until we have offers from any of the wholesale carriers to provide us with backhaul from those points of interconnet, we don't know [how much more it will cost].''
NBN Co is the government-owned company building a broadband network where 93 per cent of premises will have a direct optical fibre connection.
The remaining premises will be connected by satellite services, which are now on sale, or fixed wireless, which will be available within a year.
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