The retailer needs to pay NBNco $38 (EX GST) wholesale for the 100mbps line to your home.
NBNco charge the retailers $15 per 1Mbps for traffic on the NBN so if the retailer buys you 2Mbps then thats $30 for traffic charge.
So far NBN wholesale costs alone are $68 Ex GST without the cost of international bandwidth and cost to service you.
So when TPG is charging $99 Inc GST its cause TPG needs to buy you enough bandwidth on the NBN and International to make sure your experience is good.
TPG was rated #1 NBN provider by Canstar in 2016 for customer satisfaction, performance and value.
In the NBN world with 40+ retails there will always be a cheaper provider on price.....
I think what this means is that TPG buys 2Mbps of CVC for a 100Mbps line connection so you are only guaranteed 2Mbps on a 100Mbps line connection. Another way of looking at it is that 50 or so customers are sharing or contending that same 100Mbps line (circuit) at any given time.
TPG is assuming here that not all of those 50 or so 'Unlimited 100Mbps' customers will be using their service at the same time. Slow speed happens if too many of those 50 or so customers are downloading data at max speeds (like in the evenings).
As per NBN CEO Bill Morrow, the average bit rate per user on the network was approximately 1Mbps.
Buying too much CVC means better speeds at peak time but also reduction in RSP's profit. So the ISP has to balance profit and customer satisfaction.
From a profitability standpoint, it's a conscious decision from the RSP to either wait for congestion to be so unbearable for customers BEFORE deciding to buy more CVC or to buy more of it BEFORE congestion becomes unbearable for customers.
As much as possible, RSP tries to avoid wasted CVC by doing the above and by signing up more customers to ensure that the CVC is used up. CVC maximisation is tricky because some technologies such as FTTN just can't achieve top speeds. It's like buying more CVC doesn't really help customer as speed is hobbled already by the copper wires.
The good news here is that a new CVC wholesale pricing model took effect last 01 June 2017. NBN said that CVC pricing will automatically decrease in price as the average amount of CVC per end user increases. The CVC pricing will now be based on individual retailer averages rather than the previous model of using an industry average.
So the more TPG buys more CVC, the more it gets cheaper for TPG to buy them.
Prior to 01 June 2017, CVC was priced at $17.50 per 1Mbps. As per previous posts, it looks like TPG is enjoying the discount implemented after above date as they are now only charged $15.
NBN predicts that as data usage continues to increase over the network, they expect CVC pricing to drop further. Based on NBN's forecasted usage, they see the CVC price approaching $10.
So really, we consumers have to maximise usage of our NBN services right now and push it to the max. Download, stream and upload all you can. Yes, it will slow down and get congested, which will force TPG to buy more CVC.
There is no other way. No pain, no gain, as they say.