John Linton We've struggled for almost five years at Exetel, and for some years before that with other ISPs to attempt to provide the lowest cost broadband services in Australia without going broke - not the easiest task to take on and deliver but it was the base premise for setting up Exetel in the beginning and remains the base premise today after five very tough years.
Over that time it has been interesting to observe how the 'ISP Scenarios' have changed and I wonder what changes now have to happen for the various ISPs to 'survive' in the post high growth phase of road band take up that is beginning to make its presence felt - at least for some ISPs - at least thats the way it appears to me.
Why do I say that? The main reason is that the dial up user 'population' has almost disappeared in terms of people still using dial up as their primary/only means of connecting to the internet and all the marketing cr** about "5 million times as fast" and "blazing speed" has, or should have, disappeared with that demise. So as there is also no longer an actual major market to aim at that doesn't already have ADSL the concepts of "free" modems" and "free" activations went along, should have gone along, with that demise.
The major marketplace for ADSL now is - other ISP's ADSL customers which, for two years by my observation, have been a primary target for Telstra using their ready to hand customer listings of other ISPs users which, depending on who you believe come from various legal sources or if you aren't that persuadable some cynics may believe they come from other sources - in the end it makes no difference - a list sourced from somewhere is used to contact people who use other ISP services to transfer to Telstra's direct ISP service.
Similarly, albeit completely differently (taking my lead form Dudd's latest idiocy this morning where he described one of his/the G20s "momentous decisions" as being "contentious but likely to be popular" - and there was me thinking that "contentious" was virtually an antonym for "popular") you have the other larger ISPs trying to use some 'unique' aspects of their DIFFERENT ADSL implementations to attract other ISP's users.
Exetel has none of the advantages enjoyed by the large companies we try to compete with so our 'arsenal' is fairly empty and our 'financial resources' cry out for a more accurate description than 'strictly limited'. So we are left with, virtually, nothing to 'go to market with' unless we were stupid enough to try using that discredited, and therefore not used in recent commercial history, concept - the truth?
I wonder how that would work? Well, as it hasn't been seen in commercial use in the communications industry for almost as long as I have been associated with comunications it might be worth a try - if only for the novelty value? I realise that I'm sounding not only sanctimonious but boring so I'll move on to why we are about to try an honest and accurate version of offering broadband services based on making it both clear as to what the user will actually pay and, heres the possible difference, no 'lures' based on other factors that won't really have any bearing on overall and realistic use.
We have started this process with the HSPA services which are based on a small (close to our cost) monthly access fee plus a cost per megabyte of traffic used. No usage - no payment - is the "difference" we offer. We will continue this process with ADSL1 and then ADSL2 plans offered on the same basis - monthly access costs to the end user based on our costs with virtually no margin plus usage based on traffic at a very low per megabyte charge.
Not much difference to the older BigPond et alia plans you woud be correct in saying? Quite right. These plans are quite similar in basic concept (most people can remember that such plans were offered with a paltry ("including a massive download allowance" of 100 mbytes or whatever it was) basis with additional magabytes being offered at 15 cents or some ludicrously high/unbelievable rip off price that was specifically designed to financially devestate the unwary....and, of course, you see the same companies transferring this financial rip off concept to their HSPA offerings today on the old PTB basis of "never giving a sucker an even break".
We will introduce next week 'truthful' plans that are offered on the basis of monthly access charges at pretty much our buy prices and data downloads that are at prices that are a fraction of the cost of what are offered by any other ISP in Australia and we will rely on our true lowest operational costs, by a huge margin, compared to any other ISP to be able to deliver these services to 'low end' broadband users.
I have no idea how this 'initiative will go but we only have the advantages of our low operating costs (the result of five years of pain creating that situation) to 'play with' against the considerably lower buy pricing available to our larger competitors and their large advertising expenditures and of course - their obfuscatory "marketing".
It's a question of making a virtue out of necessity but it's also a question of whether a virtue is an advantage even in 2008 and 2009?