Thursday, December 18. 2008The Curious Case Of The ISP......John Linton ....that did not bark at regional ADSL2 pricing. (apologies to Sir Arthur Conan Doyle - Silver Blaze). Or should that be the ISP that laid down without a whimper because, mixing the metaphors, it was "all out of aces"?? I don't know why this image came into my mind when I read this: http://www.internode.on.net/news/2008/12/122.php yesterday but it seemed to illustrate the curious slavishness that permeates every aspect of the Australian communications industry where the concept of "innovation" appears to be totally absent. It seems to me that absolutely nothing of interest happens in the Australian communications industry and every company that provides services is almost unbelievably obsessed with simply offering exactly what everyone else offers at the same prices and the same 'content' and in the same places at the same time. Either that or getting Federa/State government funding to build them a regional 'monopoly' of some sort so they can just make money with no risk. You could duplicate the Internode "announcement" with the virtually identical announcements from Telstra, PeopleTelecom, Westnet and Pacific Internet: http://www.westnet.com.au/about/media/press/261108.aspx http://www.peopletelecom.com.au/internet_adsl2_plans.php http://apcmag.com/telstra_adsl2_full_pricing_details.htm Perhaps its simply that Telstra's wholesale pricing to ISPs other than its own BigPond is simply sky high, and more strangely, 'uniform' but what is the point of several different companies selling the same service in the same locations at sky high pricing? Compared to ADSL2 pricing from the same ISPs when they either use their own ADSL2 DSLAMs or buy ADSL2 services from Optus or AAPT these announced prices are ridiculously high. There is something terribly sad about these almost identical plans and pricings. These same ISPs, when they offer ADSL1 services which they also have to buy at very high prices from Telstra, manage to differentiate a little more than they seem able to do when they offer ADSL2 based on Telstra's network - so why is this the case? Probably more pertinently why would any of them do this? I have no idea. What I do find interesting is the setting of such sky high prices for ADSL2 in 'regional areas' of Australia. $69.95 for 2 gb of downloads?????? Didn't these ISPs notice something about Telstra's HSPA CURRENT pricing that's already available in all of those regional areas plus a lot more? Obviously not - at least you'd have to assume that. Of course, Telstra's current HSPA speeds aren't as fast as the average ADSL2 speeds that will probably be achieved from an ADSL2 regional location - at least at this precise moment in time. But what about in three month's time? I seem to recall Telstra promising 14 mbps and faster progressively through 2009? Do these ISPs recall what Telstra currently charges for HSPA with 2 gb or 5 gb of downloads? Today? Did they estimate what Telstra might be charging for HSPA 21 mbps services with 2, 5 and 10 gb downloads by April 2009? Maybe they did - you would have to think so - but.......... So it seems that Telstra is pursuing a plan to 'lock in' "independent ISPs" into promoting very high priced 'fast broadband' in regional Australia (in places it has already heavily marketed it's BigPond identical product to for over twelve months and signed up all it could on 2 and 3 year contracts) while it proceeds to offer ever more attractive HSPA based 'fast broadband' HSPA deals thus proving that Telstra is the 'good guy' when it comes not only to providing 'fast broadband' in regional and, gasp, rural Australia but that ALL other ISPs can't do that either now or in the future and prove that point by the pricing they offer which is higher than Telstra's HSPA which will become both faster and lower cost? Or have I mis-read the intellectual capabilities and commercial knowledge of these 'independent' ISPs? Yes - I know - "HSPA will NEVER compete with wire/fibre broadband". I wonder why, if that is true, that Telstra is making such a big deal, in advertising and in 'promotion' that HSPA is already the solution for 'fast broadband' in regional and rural Australia? I also wonder why, if that is true, that 50% of all new 'broadband services' over the past year were wireless/HSPA and that in the coming 12 months that percentage is predicted to approach 75% of all new broadband connections? Even at the current pricing Exetel pays for HSPA we can offer a 3 gb (downloads) service for less than $50.00 a month and the speeds obtained will pass 5 mbps in the not too distant future - Goodness knows what Telstra's "special" offers, and speeds, will be by April 2009. Exetel can also offer VoIP over HSPA at prices that NO Telstra reseller will get within cooee of (sorry - staying on a country theme) and a brave rural user doesn't even have to rent a telephone line. So an HSPA service in these regional areas will cost less per gb, have super cheap VoIP calls and could be run without a $30.00 telephone line rental. I struggle, ignoring the horrendous cost of wholesaling Telstra's ADSL2, to find a single reason why ANY ISP would embarrass themselves by not only putting up those ADSL2 plans on their web sites but then attempting to suggest that they represent something 'new' and of value to an end user? Times must be tougher in Australia than I thought they were. PS: If anyone catches up with Whine over the Christmas break would you explain to him that you can't have "An education revolution - over time". That would be an "an education evolution", Whine - maybe you could get a dictionary for Christmas?
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Hi John,
Great post as always. The first link (http://www.internode.on.net/news/2008/12/122.php) in your post points to people telecom plans. Comment (1)
Thank you - I've fixed it - strangely, it took a lot of doing.
Comments (4)
Telstra must be offering a LARGE discount to the wholesale price to these ISPs while forcing them to sell it at a high retail price.
There has to be something in it for the ISPs or they would not do it..... ....surely...... ....(but then maybe I am trying to use logic where logic no longer applies.....) Comment (1)
john,
as a reluctant churner from exetel to pacnet for the sole reason to get adsl2+ , as telstra is the only ISP to have an adsl2 dslam in our exchange. I believe their pricing to be superior to the other telstra clones. $74.95 for 30GB per month with no charging for uploads is more than I want to pay, but when you have no other option -- its a take it or leave it deal.. --- When is the new Exetel adsl2+ dslam going installed into the medowie MDWI exchange. Most ISP's are so busy cherry picking the prime exchanges where they have to fight for signups againt 3 other adsl2 suppliers that they forget about the Exchanges of 10,000 who have no other option other than telsta till now. Comments (2)
John.
I have a proposition for you. You have been the Nostradamus of ISP fortunes for a long time now, with a more than enveyably positive strike rate. What about a preemptive strike into Telstra ADSL2+ heartland to test the waters and give some real figures with your own Exetel Dslam in a medium large exchange with a mainly residentual, plus some small acreage componnent. Medowie ( MDWI) exchange (10,0000 pop) provides you with a unique opportunity to test the waters, before you initiate an attack on the Sydney inner city exchanges that provide such a tasty target. You need quality input from users and I put my hand up to help -- plus your family members would be able to validate the data supplied. Exetel with ADSL2+ dsalms -- its only a matter of time -- fibre is going nowhere for 5 Years min. cheers bill. Comments (2)
We've actualy considered such a thing.
The issue is the cost of a back haul which, you need hardly be surprised, is only avaialable from Telstra in a location like Medowie. Comments (4)
What about an exchange that has other back haul options. What about the Gosford or Terrigal (NSW) exchanges?
I know this isn't a discussion of possible locations but if you could find an exchange with appropriate back haul connectivity and a decent population you could 'test the waters' as billdev put it. You could even provide an Annex M option for a further edge over competing ISPs. Comment (1)
We have considered it - and may consider it again.
Comments (4)
As a "regional" user, I have no choice but a Hell$tra supplied DSLAM if I want ADSL2. It is more of a want, becoming a need.
Being a happy Exetel client since you guys started, it curdles my milk to be considering Internode for ADSL2. Comment (1)
I couldn't bring myself to ripping off regional customers by attempting to add some sort of respectability to this giant travesty of ADSL2 pricing.
Money just isn't that important. Comments (4)
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