Challenger brands like Aussie Broadband (ASX:ABB) and Superloop (ASX:SLC) are outperforming incumbent companies like Telstra (ASX:TLS) and TPG (ASX:TPG), helped by structural tailwinds including the National Broadband Network's Fibre Connect program and pricing reforms that push customers toward higher speed tiers, according to a Wednesday Jarden note.

The research firm said that 2.9 million subscribers are eligible for fiber upgrades, with September expected to be a major churn event as customers shift to higher speed plans, which is likely to benefit challengers over incumbents.

The research firm noted that Aussie Broadband is well-positioned for average revenue per user and average margin per user growth as it added about 21,000 new residential connections in the third quarter of fiscal year 2025, gaining around 20 basis points in market share.

Meanwhile, incumbent brand Telstra has about 47% of its customer base still using older fibre-to-the-node or fibre-to-the-curb connections, putting it at higher risk of losing customers as the national broadband upgrade program drives users toward faster internet plans, the note added.

Similarly, TPG Telecom is currently experiencing the largest loss of market share among the major internet providers, according to the latest report from the National Broadband Network.

Jarden has an overweight rating on Aussie Broadband, Superloop, Telstra, and TPG with price targets of AU$4.35, AU$2.60, AU$4.70, and AU$5.10, respectively.