John Linton
One of the objectives we had in 2007 was to begin the move from offering 'simple' DSL services (in other words just a DSL connection with a generous download allowance) to a DSL service that we could also provide other, useful, services on and which was 'independent' of the current over copper delivery method. I notice that Telstra's CEO was reported in today's Financial Review as saying he expected data over mobile revenues to exceed data over wire line within three years so I'm glad that Exetel, in its minor way, managed to notice this directional change a while ago.
By useful I exclude previous 'generations' of pointless add ons such as streaming radio and "free" downloads from peering points which are "so yesterday". 48 gb of off peak downloads at no charge has always taken care of the "free" download scenario and I doubt that 1 in 1,000 users ever got any value from streaming obscure radio stations - and that's a wild over estimate.
The other major commercial add on pursued by many ISPs (and all carriers of course) has been, and quite probably is, getting the rental of the telephone line plus the profits from the telephone voice calls made on the telephone line used to provide ADSL. Exetel, via the Optus ADSL2 services, has offered that and it provides some useful revenue but that revenue is not going to be sustainable and will steeply decline in 2008 and become effectively non-existent in 2009 - not something to invest in any further.
IPTV is another aspect that would deliver significant additional revenues but, while that is much closer than it was at the beginning of the year, it still isn't commercially deliverable in the various forms that exist today - at least as far as I can see (and I don't count a few free channels supplied by TPG to some exchanges as being even remotely commercially sensible - IPTV has to be a FoxTel-like equivalent). We got close to making a usable Chinese IPTV service available in late 2007 but 'fell at the last hurdle'. However the progress we have made on this aspect of deliverable services plus the knowledge we have gained is making it much more likely to be able to offer this in the not too distant future.
What we did achieve in the second half of CY2007 was a very promising start to this eventual 'sea change':
SMS via Email
FAX via Email
VoIP via wifi
Equipmentless VoIP (truly Australia wide)
VoIP at much lower costs but at toll quality
Faster P2P (essential for the future of legitimate P2P)
Of course, we need to continue to add functionality to each of those 'add ons' and we have plans in place to do that to truly provide a 'unified messaging/quintuple play' solution to our business and to many of our residential users.
We also need to make rapid progress on generating the volumes of business that will allow us to buy better and therefore make these new services sensibly profitable by the end of the current financial year. That involves some scary, to us, numbers such as 500,000 SMS per month and 10,000,000 VoIP minutes per month which is going to be a tough ask.
We will also be in a much better position in 2008 to provide some sort of VOD service that will provide real value and real titles but that is something that is dependent on new 'delivery mechanisms' which are now beginning to become available. There are a number of very interesting and very promising new 'twists' on the current options which, if the become realities will remove at least one of the two current problems with delivering a useful VOD service.
It seems to me that our first three years were spent rapidly building Sydney based infrastructure required to deliver simple DSL services and since around April of 2007 all our efforts (and money) have been going in to adding value to those basic services with the current plans for personnel and money in 2008 being overwhelmingly allocated to services and structures other than buying ADSL tails/Ethernet links from other companies - which is the very definitely what has to happen.
Having said that we are now 'almost there' in getting the second GigE connection commissioned to more than double the current 900 mbps capacity we deploy to NSW ADSL1 (and perhaps even ADSL2 in the not that distant future) users and we are continually upgrading almost every connection to all other services in NSW, QLD and VIC on a monthly basis and seem to be purchasing the additional routers and switches needed for the increased bandwidths at an ever more rapid rate.
Finding and developing the new skills that these new (to us) services require will not be the least of our challenges in 2009.