Australia’s National Broadband Network is a nationwide broadband service that brings broadband internet into your home or business with a range of options and providers you can choose from to best suit your needs.

As it’s fairly new, you might be wondering about residential NBN service, business NBN service, and what the difference is – especially considering the vast price difference between the two.

But, what’s fine for your home might not be up to snuff for your business and there are several reasons for that. Let’s look a little closer at the fine print:

You get what you pay for

Some might say that there is no difference between residential and business internet service in the context of the NBN, but this is largely not true. The needs of a business are far more critical than residential needs, as any downtime at all could result in financial loss and impact business continuity.

For business customers, the offering needs to be more robust, compliant with 5-nines or greater (99.999) uptime and there is an expectation of network redundancy and stability. Business customers have a static IP address (one that never changes) and in the case of a failure, the IP will be automatically routed to another connection. In so doing, the connection remains stable, but understandably, this level of redundancy comes at a higher cost.

For residential subscribers, the need for uptime is not quite so dire. A slowdown or a service dropout is more of an inconvenience than anything else. A connection may be throttled after the monthly bandwidth limit has been exceeded, but the amount of throttling will be subtler for a business than it will for the home customer.

Contention ratios poor for residential

Contention ratio is a complex subject with a number of variables, but what it boils down to is this: your residential ISP purchases bandwidth from the NBN, but there is really no way they can predict exactly how much they are going to use. They know how much they need, based on what their current subscribers are using and how many subscribers they have, but there is an unknown quotient, called a backhaul, that they need to purchase just to give them a buffer.

The problem is that backhaul is very expensive, so they tend to purchase less than they think they will need simply to keep costs reasonable. The result is that at peak times when all of their subscribers are using the internet, the service may slow down considerably. The measure for this is called a contention ratio, calculated by taking the maximum bandwidth that might be used divided by the actual bandwidth provided. A decent contention ratio will be anywhere between 100:1 and 200:1, but in many cases, it can climb as high as 400:1 – meaning that there are 400 people competing for one point of connection.

Business NBN, on the other hand, might have a contention ratio of about 20:1 or lower. Given higher demands for stability, speed, and reliability from businesses, they are willing to pay a great deal more to get better service.

Business grade customer service and SLAs

Customer service is another area in which residential and business NBN differ vastly. In residential applications, customer service is often outsourced to an offshore location, while business customer service is usually handled in-house.

Business NBN customers will also have the benefit of a service level agreement (SLA) to define what the customer will receive. SLAs cover such points as reliability (uptime), efficiency, speed, and responsiveness. It will also dictate the consequences of failing to provide the level of service as promised as well as what reparations or reimbursements will be offered in the event of downtime.

If you have any questions or concerns about your business NBN service, call to speak to a technician at Greenlight today.