👉 Background: The National Broadband Network (NBN) kicked off in 2009 with big promises of lightning-fast internet for all. But sixteen years later, we’re sitting at a global speed ranking of #75, behind countries like Trinidad and Tobago, Guyana, Nicaragua and Grenada.

‍👉 What happened: Now, NBN Co has announced that it has cut its annual loss by 10% in the last financial year to $963m. But at the same time, they received $1.19 billion equity injection from the federal government to soften the blow.

‍👉 What else: NBN is spending BIG on new low-earth orbit satellite broadband via Amazon, which they plan to launch in mid 2025. The reason is because NBN is facing serious competition from other providers with faster connections, like 5G and satellite broadband.

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‍What's the key learning?

‍💡When it comes to business, there are generally five forces of competition that can influence a business’ profit potential. We have:

• The threat of new entrants
• The bargaining power of suppliers
• The bargaining power of buyers
• The intensity of rivalry
• The threat of substitution

💡The threat of substitution is biting at NBN Co’s heels because customers can now switch to a different service that meets the same need, and is often at a lower cost or with a better value proposition.

💡The ACCC reports over 500,000 Australians now use fixed wireless access, like 4G or 5G as their primary home broadband connection, which is nearly double the number from two years ago. The growing appeal of these substitutes puts more pressure on NBN to improve their service.