John Linton
I spent some time yesterday trying to finalise my recommendations on the two major issues currently facing Exetel:
1) Which 'supplier' we should use to provide a broadband over 3/4G to our customers
2) What pricing we can put in place that will not send us broke but will compete with the current mobile carrier offerings
I glanced through this article that briefly touches on Telstra's possible future pricing moves but it seems that Telstra will continue to hold its prices above the other carriers for the time being (or should that be the other carriers will continue to offer lower prices than Telstra whatever the reality of cost/profit?).
http://www.misaustralia.com/viewer.aspx?EDP://20080221000020330025
Whatever drives the pricing decisions by the four Australian mobile carriers the end result is that Exetel won't be able to make any money by offering broadband over 3/4G in 2008 (at the current pricing we have in firm offers) and will have to take some less than attractive risks throughout 2008 to make a profit from such services in 2009.
The very best price we have been able to negotiate is approximately 1.45 cents per megabyte with traffic both to and from the end points being charged. This is better, by more than an order of magnitude, to where we started which was around 15 cents a megabyte but it still precludes us offering a general non-wireline broadband service and, at least for the foreseeable future, we will have to confine our 'marketing' to dial up 'upgraders', mobile users and people over 35.
Subject to any last minute 'negotiation' the best we are likely to be able to offer when we release the service in Australia will be:
MobA - $20.00 per month with 1 gb included (up and down)
MobB - $35.00 per month with 2 gb included (up and down)
The 'dongle' or modem required to connect to the service will cost $200.00
The contract term will be 12 months
There will be no free 12 midnight to 12 noon period
All other services provided with the current Exetel wire line plans will apply to the mobile data plans.
I don't think we will be able to do any better than this pricing/traffic allowances until the third quarter of calendar 2008 (if then)and we would only 'go to market' on this basis because we see the need to build the volumes and experience sooner rather than later to move our main broadband business from wired to wireless over the coming 21 months.
Making even this level of offering available will require us to 'partner' with two other companies which we have no experience in doing and have many reservations about - I have never 'played well with others' and it's far too late to expect a change in my personal and business characteristics at this late stage of my life.
On the brighter side it may be that we are finally reaching the end of the road in being able to start offering broadband services over something that doesn't involve paying Telstra all the profit that can be made from such activities and maybe, at some far future date, there will be true choice of attractive services with usable download capacities at attractive prices available in Australia and the word "Telstra" will have largely been forgotten by the majority of Australian communications users.
....What were those pink, corpulent, winged creatures that flashed past my window just then?