Under 50% of ISPs sign onto NBN contract

update Just three days out from the expiration of a trial agreement, less than half of the active internet service providers (ISPs) on the National Broadband Network (NBN) have signed the new year-long contract with NBN Co to wholesale its services.

As first reported by the Australian Financial Review, the trial agreement is set to expire on 12 January, and NBN Co will not allow the ISPs who have yet to sign on to the formal wholesale broadband agreement (WBA) to add any new customers. The 4000 customers with active services in NBN first-release sites will not be affected.

NBN Co confirmed to ZDNet Australia that 12 ISPs have signed onto the wholesale broadband agreement. There are a total of 22 ISPs with customers active on the NBN, however there are also a number of ISPs who have signed the WBA that have yet to complete the on-boarding process to start signing up customers.

NBN Co would not name which companies had signed on the dotted line, and which were holding out.

According to iiNet's chief regulatory officer Steve Dalby, the concerns that iiNet had with the contract — disallowing regulatory oversight, and NBN Co accepting no liability for customer-service guarantees, negligence or network outages — still remained.

"Our legitimate concerns are still unaddressed. This is true across the major companies that I have swapped notes with," he said.

In a time when the government-owned company has faced criticism due to only achieving 4000 of the 35,000 projected active services up to this time, Dalby said that NBN Co is "shooting themselves in the head" by blocking defiant ISPs from adding new customers after the Friday deadline.

NBN Co said that it had been engaged with the industry for nearly two years on the wholesale broadband agreement, and had published five different versions of the document prior to the final agreement in November last year. It noted that the most recent change saw the length of the five-year agreement reduced to one year, and allowed NBN Co to make changes to the agreement if the competition regulator demands changes to the special-access undertaking.

"NBN Co is committed to having wholesale broadband agreements which are fair and reasonable to all parties. We have made provision for further opportunities for the development of the WBA over time," NBN Co said.

Within the WBA, there is also the opportunity for ISPs to participate in a contract-development forum that can tweak the agreement for all parties.

Updated 12:46pm, 9 January 2012: NBN Co clarified that the 12 ISPs were not all active ISPs.