What is nbn and how does it work?

nbn is the wholesale broadband network built and run by nbn Co. It has replaced the old Telstra phone and pay-TV cable networks as the way most Australian homes and businesses connect to the internet. nbn Co doesn't sell internet plans directly - instead, providers like Lightning IP connect to the nbn and sell you a service over it.

nbn is a "last mile" network

The nbn only covers part of the journey your data takes. It connects your home to one of 121 nbn Points of Interconnect (POIs) around Australia - handover points where nbn Co passes your traffic to your internet provider.

From the POI onwards, it's your provider's network that does the work. Lightning IP connects to all 121 POIs and manages everything from there to the wider internet, including:

• Backhaul - the high-capacity links that carry traffic from each POI to our core network.
• Our core network - the routers, data centres and systems that manage your connection.
• Connections to the internet - the links to other networks, content providers and cloud services that get your traffic to where it's going.

In short, nbn Co is responsible for the connection between your home and the POI. We're responsible for your service, support and billing, and for everything that happens to your traffic after the POI.

How the nbn reaches your home

The nbn uses a mix of technologies depending on where you live: fibre optic cable, the existing copper network, the old pay-TV cable network, fixed wireless towers, or satellite. The technology available at your address was decided by nbn Co, based largely on what infrastructure already existed in your area.

Your technology type affects the maximum speed you can get, how reliable the connection is, and in some cases whether you need a technician visit to connect. It doesn't affect who you buy your plan from - Lightning IP can generally offer a plan over any nbn technology type available at your address.

"Aren't all nbn providers the same?"

It's a common belief: every provider uses the same nbn, so you may as well pick the cheapest. But the nbn is only the last mile. Everything after the POI is built, run and paid for by each provider, and that's where the differences show up.

• Capacity. Each provider decides how much capacity to buy at each POI and across its backhaul. If a provider skimps to keep prices low, its network can become congested when everyone is online at once, usually in the evening, and speeds drop.
• Network ownership. Some providers run their own network from the POIs, while others resell another company's network and have less control over how it performs or how quickly problems are fixed.
• Routing and connections. How a provider connects to the rest of the internet affects latency (lag) - noticeable in gaming, video calls and cloud applications.
• Support and fault handling. When something goes wrong, your provider is the one who diagnoses the problem and works with nbn Co to fix it. The quality of that support varies a lot.

The ACCC's Measuring Broadband Australia program regularly publishes busy-hour speed results for major providers, and they aren't identical - which they would be if the nbn were the only thing that mattered.

Two services on the same nbn speed tier can deliver quite different experiences depending on the provider behind them. Price matters, but it's worth looking at what you're getting for it.