NBN CVC: What is it and why does it matter for customers?

NBN Co operates Australia’s national broadband network as a publicly owned government entity, selling its services to telecommunications providers around the country. These providers pay two key fees (among others) to NBN Co in order to access the network: an AVC charge and a CVC charge.

While the Access Virtual Circuit (AVC) charge is a fixed monthly fee that’s charged on a per-user basis and provides a specific bandwidth allocation for each home, the Connectivity Virtual Circuit (CVC) charge is a bit more complicated.

CVC is a charge service providers pay to cover the amount of bandwidth they provide to their customers. The higher fee a provider pays, the more bandwidth its customers can access and a lower chance of congestion affecting your speeds.

The CVC charge covers the full amount of bandwidth the provider wants to pass between its own network and the NBN’s network. Where this affects customers at an individual level is when a provider's purchased CVC reaches 100% utilisation across users, which will see speeds start to fall.

The way your internet service provider chooses to manage its CVC capacity can impact the speeds you see. Every telco pays a certain amount to NBN Co per customer in CVC charges. The purchased CVC is then spread across its entire customer base, depending on how many are actively using the internet at one time.

If you’re on the internet during non-peak hours, there should be plenty of that purchased CVC to go around. During peak hours, however, that CVC is spread thinner as more people access the internet at the same time. This can cause issues such as congestion, which sees speeds and stability fall.

After some pushback from a number of internet service providers, NBN Co has recently proposed a number of alternative ways of charging RSPs that could see it move away from the CVC model in future. These options include a flat-price pay scheme which would see providers, and likely customers, pay more to access the network but that entirely does away with the extra bandwidth charge. Other options include lessening the CVC cost per customer, or removing CVC costs on higher-speed plans. However nothing has been agreed to as of now.

As a customer, you don’t have any say in the CVC capacity your provider chooses to purchase, despite the fact it’s the customer that is most affected. If your provider buys more CVC capacity, this will likely be reflected by higher typical evening speed claims on a plan, but that number can depend on the size of your telco and their customer base and isn’t necessarily a foolproof indicator. As a basic guide, a higher typical evening speed means the provider has likely committed to paying for more CVC per customer to ensure high speeds.

It can be quite hard to find out how much CVC your internet provider has purchased and how its performance is impacted by this bandwidth allocation. Some telco’s will feature graphs or indicators on their website that will highlight their CVC usage in relation to your nearest Point of Interconnection, which is where the provider’s network meets the NBN’s – and a common point of bottlenecking.

If your internet provider doesn’t disclose its CVC capacity, you’re unlikely to find that information anywhere else online. So if you need to know, you may have to ask your provider directly if they’re willing to share that information. If they aren’t, checking the typical evening speed of the plan is the only real indicator you’ll have, and will provide you with an idea of the speeds you’re likely to see on your NBN plan during peak periods.

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