John Linton's Personal Musings

John Linton

.....its as if millions of financial controllers suddenly cried out "no more risky business" and then fell silent. (with sincere apologies to George Lucas)

There are some signs of new attitudes in various aspects of pricing relating to the provision of internet services in Australia which seem to be contradicting each other - at least in some ways. I have never really understood the ways the carriers go about their business dealings in Australia and my association with Telstra goes back for almost three decades and with Optus for the best part of fifteen years. I was one of the earliest AAPT customers when they were the first to provide low cost international calls via 'over ride' in 1990 and even my dealings with Vodafone are approaching their tenth anniversary. So I have some sort of perspective,obviously limited to my own experiences, on all of these carrier's changing 'attitudes' over quite a long time.

More lately we have dealt with what is now Verizon and I've also had a series of discussions over the past three years with major communications services wholesalers in the UK and Germany. We have also had some quite serious discussions with the major telecommunications hardware suppliers and contractors when we were looking at the possibilities of investing in our own small ADSL2 DSLAM network.

Apart from the very large operators in Australia we have dealt with a number of smaller organisations and have bought services from companies such as Pipe and NextGen, hardware from Netcomm for the last 7 years as well as companies smaller than those - some very small.

So, it seems strange to me that I have to say that I haven't got a clue what is going on at the various suppliers with whom we deal at the moment. Maybe I never did and it never mattered because our buying volumes were, and remain, so small that we never pushed very hard for a 'better deal' recognising that we had no 'bargaining power'. However we have usually been able to understand where pricing for various products and services 'stood' at different times over the past decade or so and have sometimes been able to get better pricing than we expected for some elements of our services. 

Of course, we have never been able to get anything but the worst possible pricing from Telstra and, in hindsight, should never have continued to buy from Telstra after the McGaughie and subsequently the Trujillo appointments made dealing with that company even more impossible - too late now to realise that we should have cut our losses 4 years ago and had a much happier life. Just for forms sake we asked for an IP quote from them as we do each March when we decide on an IP supplier for the coming year and, just as every year we got a quote roughly twice as expensive as we were expecting/hoping for and some 15% more than we are already paying. So nothing has changed for a small/tiny company dealing with Telstra - the only unchanging constant in an otherwise continually changing industry.

Apart from IP we are looking to buy a number of other services from various supliers at the moment; some we already buy and two new services we think we would like to offer if we get the 'mix' right. The responses from people we currently do business with are, with one exception, quite strange. Two suppliers whom we thought would be interested in these new opportunities (for us - not for them) or at least would go through some polite motions simply effectively told us to 'go away' - expressed differently to those words but with the same unequivocally clear meaning.

We are also looking at increasing the levels of business we are doing quite considerably in two of our current services and have demonstrated that our volumes are increasing quite sharply over the past few months. Again there was no interest in looking at any way of 'promoting' the services and, almost the reverse reaction, it seemed to us that we were being told that we shouldn't bother them with our views and plans. Fortunately, at least for us, there are alternative sources.

I've formed the conclusion that just as our small/tiny amount of business has always been totally irrelevent to Telstra it is now becoming as irrelevent to other larger suppliers and we are much better off dealing with other smaller suppliers that not only are interested in our size of buying but provide services and products more inexpensively. I am beginning to think, with one exception, that is what is happening or perhaps has already happened. Or maybe we just need to progressively offer different services over the next 12 - 18 months?

Perhaps I'm mistaking a lot of 'internal pressure' within some of our suppliers with a sudden lack of interest in doing more business with Exetel? Maybe its too many wholesale customers not paying their bills? Maybe.......but what's the point? For whatever reason something has changed and it's time to move on.