Tuesday, March 31. 2009Changing Of The 'Guard' In Exetel's Product SetJohn Linton Exetel's first service was residential broadband and that service has remained the major revenue earner for Exetel for the whole of our short existence to date and is likely to for some time yet. However we have begun to make changes to our 'product line up' yesterday that, over time, will change our 'marketplace landscape' considerably - both in terms of our customer demographics and the services from which we derive our revenue (assuming that we remain in business during whatever eventuates later in 2009). We started making the changes to our broadband plans yesterday and will complete that process before the end of this week. I still, personally, have no sensible view on what will happen over the coming three months in terms of any 'down turn' in the Australian economy and any subsequent 'flow on' effects (and less than no idea beyond June 30th) but have formed the view that we need to 'improve' our offerings ahead of any 'negative events' that include the possibility of 'compellingly priced marketing programs' from one or more of the major carriers.I am making the assumption that the major carriers will be affected by any financial problems before anyone else and will act in the ways they have done in the past in their attempt to improve their 'market shares' and 'protect their revenue streams'. With a day to go in Mach our new orders for all of our major revenue contributors are running at or over 35% greater than in March 2008 but part of that is due to the fact that Easter was in March last year. Still, the increase is extraordinary even taking that fact in to account. I will be fascinated to see what now happens in each month of the last quarter of this financial year. I think that one of the contributing factors to our very good start to 2009 has been our very attractive VoIP offerings and our equally solid 'naked' ADSL2 services. From what I read (and I'm aware of the dangers of believing statements in Australia's media) it seems that every provider that has their own, realistically priced, VoIP service is doing very well with that aspect of their service offering so it is consistent that Exetel would be performing at a similar level. This played a major part in our deliberations of how we could improve our 'whole of service' communication offering to residential users in the plan changes we made yesterday and will make over the next day or so. The main change to our ADSL1 plans is the inclusion of 100 no charge VoIP calls local/national to wire line services. The retail value of this new 'add on' for ADSL1 users is equivalent to a $10.00 monthly price reduction if they are using another VoIP provider (or Exetel VoIP) and much greater than that if they are using 'standard' telephone call services. On the average $A45.00 monthly charge for an Exetel ADSL1 service this new 'add on' is the equivalent of a 22% discount on a customers monthly ADSL bill if they were to make 100 VoIP land line calls a month - an unheard of discount on a service which is already priced at the lowest cost in Australia. Our view is that or VoIP business has been continually growing at an increasing rate since we introduced 'naked' ADSL2 in December 2006 and it is rapidly approaching becoming a 'top five' revenue earner for the company. For us to achieve the call numbers/minutes carried 'thresholds' we need to achieve better per VoIP call pricing we need to quadruple the number of call minutes we deliver to our suppliers and one of the ways we can do that most easily is to attempt to convince every one of our broadband customers (wire line and wireless and mobile) to use our VoIP service. "Free" (which this 'add on' truly is for once in the history of communications in Australia) is a high risk way of accomplishing the required growth but it has a couple of upsides in the longer term and is affordable for us in the shorter term. In the short term it's obviously going to be a 'profit hit' and quite a large one but, if our calculations are correct, the increase in broad band sales will mitigate that loss and, if we have got the numbers 100% correct (something we have never achieved so far) it will actually cost very little. The longer term upsides are that VoIP is never going to a service that Telstra and Optus 'embrace' as they have too much 'standard' telephone call revenue at gigantic margins to ever make that practical and therefore it gives a small provider such as Exetel an true, and ongoing, 'edge'. The other longer term benefit is that Exetel's VoIP service is extremely good and we have in depth knowledge (and over three years experience) in delivering high quality VoIP both for ourselves and our customers and it will become a key business service over the next two years - which is a market we will be concentrating on from now onwards. At the end of some 9 - 12 months it should deliver us the VoIP minute volumes that will have made it practical to diversify our 'VoIP network' with termination points in all capital cities and multiple redundancies across the network which will be essential to be able to bid for VoIP services to the larger corporations and government departments. So, together with an increase in the 12 midnight to 12 noon download allowances 'across the board' plus the decrease in per gb rates on the pay as you use plans and increases in the 12 noon to 12 midnight download allowances on two higher speed plans we are basing our current 'round' of plan improvements mainly on the additional value of truly free VoIP calls. VoIP seems to me to the best way of dealing with the large carrier's predatory "marketing" campaigns and I also very much doubt that smaller providers than the large carriers have got either the 'bravery' or the inclination to do what Exetel is going to do. So, hopefully, a unique approach to the dangers of the immediate future. Trackbacks
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Great move. Any chance of getting cheaper VOIP ATA boxes available? I have several family members interested in the 100 free calls (as they have adsl-1 with you) but don't want to spend $95 on a device they may not be happy with. I guess they could trial softphones, but IMO they're even flakier than an ATA.
Comments (3)
There is nothing on your home page or the first page of the Residential section that details these changes.
How much work do you expect people to do to find out about your new offering? Suggest you need to rethink your home page so it includes fresh content such as new product offering news. Comment (1)
We continue to look for the magic box but we will also look for a very low cost ATA.
My past hesitancy about low cost ATAs is that the few I've seen don't perform all that well. Comments (10)
We won't be changing our home page. I like it the way it is and it suits our company's "ethos".
If someone goes to our site to seriously look for a service then they will find complete details - very easily. If they're so inept they need a sign to point the way then they are not the sort of customer we want. Comments (10)
while i certainly agree your voip inclusions are extremely generous, i personally would see greater value in a decrease in the cost of voip to mobile calls.
might less 'free' national calls in exchange for a drop in the mobile charges be workable? Comment (1)
There are limits to our ability to give so much "free".
Comments (10)
Other companies do mobiles for 15c/min or less - see https://www.mynetfone.com.au/offers/whirlpool/whirlpool-plans/whirlpoolsaver-plan/
Pennytel does 10.5c/min mobiles - URL not static TPG does mobiles for 7c/min at peak cap value. (Might be an unsustainable loss leader.) Your Mobile X plan does 15c/min Perhaps use these three items to see if you can bargain better rates from your suppliers as you're cheapest in ADSL, HSPA but not in VoIP? Cheers, Mike Comments (2)
I have a very occasional problem with VOIP calls which isn't concrete enough for me to have made the effort to log a support request, but is still annoying.
It mostly happens to my wife, probably because she makes more phone calls than me, so I don't have a lot of direct experience. When I try to repeat what just failed for her, it sometimes fails, but sometimes works. The problem is that calling a number which is then answered by some sort of voice-mail (and we don't really know what sort) sometimes results in the call being disconnected rather than being able to leave a message. At least that is what we think is happening. We usually simply call again using the non-voip line (We have ADSL2+voice) and we manage to leave a message. Unfortunately I cannot give you any numbers that reliably do this. This is enough to keep me from considering a 'naked ADSL' option. Next time it happens I'll try to get exact time and number information and lodge a support request, just in case those detail are useful. Comments (3)
...and which one of those gives you 100 free wire line calls?
Comments (10)
It seems with the inclusion of the 100 free calls on ADSL2 plans you have de-valued the Naked plans. The naked plans are $5 more expensive than the INC2DSL plans once you remove the $15 monthly telephone line charge. With only a $10 difference (and both plans now getting the free calls bonus) there isn't much incentive to move from INC to NAK plans. Is there really only a $10 difference in Exetel/Optus costs/charges?
T. Comments (3)
Good point.
Assuming a customer makes 100 landline calls in a month to use the $10, you are cheaper than all of these up to the following points... TPG: 47 minutes to mobile (peak cap value only) Pennytel: 68 minutes to mobile MyNetFone: 88 minutes to mobile. Sorry I didn't take account of that in my earlier post - it is a significant difference. It may also help to spur growth of VoIP. The cheapest ATA I have used with Exetel is the P2320R, $20 from CorMain. Works pretty well in most cases, but can be a support headache if you want DID to work. For serious VoIP users I never recommend anything other than an integrated ATA/Modem; and would probably recommend the same to you as the support costs for anything else can be a nightmare. Comments (2)
I can't divulge confidential contract details like that.
From what is publicly available on the topic of what Telstra Wholesale/The ACCC have made public you would be able to work out what the difference is within a dollar or so yourself. Comments (10)
Oh and you're giving away $10 worth of free calls on a $5 wireless plan. Is that smart?
Comments (3)
Depends how you look at it.
All data is 'charged' (both up and down) on HSPA so there is some charge. Then again, there are all sorts of inter-dependencies in structuring plans and there are also collateral reasons for doing various things. Comments (10)
Will the free 100 voip calls also apply to the old ADSL1 bundled plans?
Regards, Harry. Comments (3)
that's the challenge, you can get a cheap ATA but they are not particularly consumer friendly so the support costs outweigh the price advantages, step up into a well designed reliable ATA and you are probably around $60, will people justify the expense if they have no experience with VoIP, perhaps not
Comments (3)
Neil, I would suggest posting in the Exetel forums as the problem you describe sounds like a config error in your hardware, with a little bit of effort things such as this can usually be resolved without too much fuss
Comments (3)
I'm really impressed that Exetel have been able to allow VoIP on all plans and with such a generous amount of included calls, to anyone that wasn't sure of the value previously this has to make the Exetel plans the stand out value offer in the market
Well done (yet again) Exetel Comments (3)
Well done Exetel
I already use voip for 90% of my calls, but this will help get some of my customers to use it too. Once local number porting is introduced (any idea on timeframe?), combined with a HSPA account, it will offer an extremely competative all in one solution. I will be switching from ADSL to HSPA & getting rid of my phone line as soon as LNP is available. Comment (1)
a good idea would be to get a truckload of those open network modems with wireless and voip built in, bought one myself a few months ago for use with naked broadband and have no complaints at all. i think they are the 8424rlw?
Comment (1)
Yes, I have got one for my sister and another for my niece in the last week...... that makes 4 for family members in the last 3 months)
My sister is a new Exetel ADSL2+ customer (Mar 09)and my niece will be by end April. Great modem with all the facilities. My niece can now let her daughters use their laptops through wireless (would you believe she had bought a wireless stick from bigpond!)- and also allows them to start using voip. Sister now can use Exetel voip instead of current locked ATA with another provider. Regards, Harry. Comments (3)
Yeah the Open Network 824RLW is a re badged Billion 7404VGPM. 2 VOIP ports, PSTN fall over, ADSL modem and wireless for about $112. I've found it to be rock solid. I'll be recommending it to all my clients from now on.
Comment (1)
john,
whats the chance of some discounted form of usenet through Exetel. Why people still use p2p torrents i dont know. Price / Speed and reliability are the only things that interest me nowdays Since usenet requires no form of sharing wouldn't Exetel benefit from suppling some form of usenet like astraweb -- which would save Exetel on the uploading of data. Comment (1)
You have to remember that Exetel make almost nothing out of providing ADSL.
Having said that you would realise that ANYTHING that has an ongoing cost to Exetel has to be passed on to the customer and, unless you can advise me otherwise, there are no download sites that offer bulk discounts that would reduce the cost by enough to make such an offer practical econmically. Comments (10)
John, could one of the new "changes" possibly allow current ADSL2 users to move over to the PAYUDSL2 plan?
Regards, Harry. Comments (3)
That will be activated in the user facilities in the not too distant future.
We have needed to ensure that the different billing mehtodologies work correctly before releasing the plan to current users. Comments (10)
Great news to see the changes to the plans with more data! Really do appreciate the extra allowance.
If you are able to save money in the future would it be worth upgrading the p2p cache to store more data/more hits for p2p users? regards, Martin Comment (1)
Have you tried contacting sites that offer services crafted for ISPs and other corporations to get a quote?
http://www.news.astraweb.com/corporate.html http://www.giganews.com/outsourcing.html Comment (1)
Even if you found a way to provide it at cost. Not as an 'included' add on. But a subscribed (paid for) service.
People are now paying the additional to astraweb (or other provider). By having it as an optional, paid for, extra, then the perceived benefit is there AND members have the convenience of one bill. Comment (1)
Steve is looking in to it to see if "Exetel's Buying Power" can reduce the price for those customers who want to use it.
Comments (10)
My point for bringing this up at this time is that if exetel wants to broaden its VOIP base (which sounds like a good plan), then it must have a VOIP service that "just works".
Jo Customer just wants to get an off-the-shelf device, put in the username and password, and basic functionality should just work. Having to tweek some obscure config setting is not really an option. The VOIP server at exetel's end really needs to be as flexible as possible and accommodate as many strange pieces of hardware as possible. In this case, it turns out that my device is doing something a little strange (resending SIP:INVITE after 20 seconds of 'phone ringing') and exetel's VOIP service is responding to this by reporting "500 - server error" which is not a graceful response. I'm fairly sure there is no way to change the '20 seconds' on my router (the same 824RLW that is being proclaimed elsewhere in this thread), so I hope that exetel are about to get their server to handle the situation "better". If anyone is actually reading this and has an 824RLW, and you see what happens when you call a number that doesn't answer for 20 seconds? Comments (3)
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