John Linton
.....was Sydney - Bangkok - London (or London - Bangkok - Sydney) but the flight London - Bangkok - Colombo is actually worse because it involves 5 hours in Bangkok airport waiting in the Sri Lanka air 'lounge' for the connection to Colombo.....let me tell you it's not something you want to do after an 11 hour plus flight. Oh well - the joys and glamour of international travel are such a 'perk' for 'management' of small companies.
Plenty of time though to catch up on what is happening in the Australian communications marketĀ - or it would have been if the SL Air wifi connection would actually work for more than a few seconds at a time.....which I couldn't make it do. We filled in the five hours delay between landing and catching our connecting flight to Colombo and used the hotel's wifi to deal with my email, have a shower and a cup of coffee and the return the 500 meters to the airport via the hotel shuttle bus. I won't go into the details of the 40 minutes it took the nice SL check in lady and 6 other members of the SLA ground staff to acquaint themselves with the validity of a 'paperless' ticket nor the further 25 mnutes it took to convince immigration that there was nothing sinister in us picking up our bags from immigration and then checking them back in a gain 3 hours later - just our fear of losing our luggage via airline issues and our need for a shower and a change of clothes. It took more effort than is worth wasting any more words on.
I managed to find time to read this:
http://www.smh.com.au/opinion/politics/telstras-monopoly-meant-mediocrity-for-consumers-20090917-ftmf.html
in several 'sessions' once we were eventually allowed to clear immigration and found it interesting in several ways not least the bringing in to perspective that all monopolies, whoever owns them, ensure that the end user gets sub-optimal services.I don't know what you make of the concepts of some sort of kluged private/public new entity that will somehow run out a national fibre infrastructure in Australia but, assuming it ever does happen - which I personally regard the chances as being less than one in four, why would anyone think a new government controlled monopoly in telecommunications will be any better than the old Telecom Australia prior to the creation of Telstra? Only the very dumb?
So assuming that there ever is an 'NBN2' what actually will it deliver to end users? I really don't care about the broad sweep of "infrastructure build out" in framing this question - I only have a concern/interest for what it might mean to Exetel (and Exetel's shareholders). We formed Exetel on the basis of buying wholesale from TYelstra who we, rightly, judged as being a bloated and slothful monopoly that charged such astronomically high pricesthat even a tiny strat up could deliver a lower cost service at an equally reliable and spedy way than any monopoly could if they even vaguely adhered to what we understod to be a retail/wholesale pricing structure. Of course that was blown out of the water when the tex/mex carpetbagger appeared on the scene and, as a tiny company, we had to change and adapt which we did. We even survived - and, dare I say it, we even prospered as we continued to refine every aspect of our business to save a dollar here and there so we could deal with a monopolist's predatory practices.
We would never be able to make any money out of services we bought from Telstra but we didn't actually care because our business 'model' was based on buing services from other, if not more reasonable, suppliers then at least suppliers we could have a mutually beneficial relationshi with rather than with a company that described us as parasitic scum. That has all gone sort of OK over the past few years - we survived, we made a dollar here and there and we were able to provide a benefit to a number of different Austrlian buyers by selling them services that were lower cost than Telstra's and were pretty equivalent in every other respect.
No big deal - many other independent companies did the same - or if not "the same" their version of something similar. But now, or actually not "now" exactly but possibly at some time in the unknown future, we arefaced with Krudd playing the 'White Knight' that heretofore has been the role of the smaller wholesale buyers from Telstra and I'm not sure what role that leaves for anyone else as Saint Kevin (a man who really not only wants but NEEDS your love) is breaking the Telstra monopoly and building new monopoly that, inevitably, will be run by Telstra.....or some new incarnation of Telstra Wholesale.
I really don't see a 'role' for Exetel in Krudd's brave new word of FTTH built by government funding, managed by Telstra Wholesale and doing......well.....I'm not sure what it will actually do but it surely doesn't need wholesale customers to do it over the coming decade. So tiny companies like Exetel have no future in Saint Kevin's completely stupid view of an Australian communications future and I really don't see what future much larger companies such as Optus have.
Exetel provides end users with access to the world's web sites at the lowest cost in Australia and at speeds that are more than sufficient for that purpose today and since it came into existence. Our 'value proposition' is that our negotiating/buying abilities allow us to deliver those services at a lower cost than anyone else in Australia (despite Telstra's rip off pricing and other suppliers "handsome" mark ups on their own costs) and our services seem to be appreciated by the tiny percentage of the total market who use them. But what place to we have in Saint Kevin's grand scheme of things for residential users? Not anything I can see.
I am obviously too stupid to be involved in this industry as the Labor Party dunces know it so much better than I do. I need to find something I can actually understand as, apparently, 70% of Australians judge Krudd to be correct and therefore me to be a hopeless incompetent.
John Linton
.......via Sri Lanka (for a quarterly progress review) and then two days in Bangkok to deal with some outstanding personal issues. Two weeks in the rural backwaters of the SW UK and two days in London have been exceptionally pleasant and, as always, I don't like the thought of returning to Australia - a typical feeling of most people who take a holiday I imagine. I found the mobile HSPA service throughout the trip faster and more available than a year ago and lower cost - by a long way. My tests in London of the 14.4 performance was inconclusive with the top speed I could generate being a little over 4 mbps down. I guess it is an indication of the future of HSPA in Australia but as there can be no assessing a likely time frame it isn't much use to me, you or to anyone else.
While I was here I also looked for a version of the 'magic' box we have been looking for over the past 18 months (maybe longer) but apart from some references in some PC magazines to pretty generic router/modems there was, I thought strangely, no mention of such devices. That leads me to think that there is no demand in Australia for end users to use HSPA as a standalone broad band service as we perceive there to be in Australia. Perhaps we are wrong to perceive that to be the case? Personally I would have thought the need to connect HSPA to more than one computer would be quite prevalent in most households. I would also have thought that there would be a sensible demand to use the HSPA service to save money on voice telephone calls via VOIP - perhaps that assumption is also wrong? As I have been wrong so many times in my 'decision making' life it wouldn't surprise me.
There is some sign in Australia that at least one 'independent' importer is bringing a router that also supports VoIP and has a slot for an HSPA modem at a lower price than the 'brand names' but their pricing to us is still way more than a 'mass market' buyer would pay. I, quite possibly in my ignorance, have always believed that the end user price for a combined router/modem/FXS/wifi/ethernet/HSPA 'magic box' had to retail for less than $A200.00 which meant a buy price for Exetel of around $A130.00 to be able to give our agents a 25% margin on sale and additional money for 'installation/configuration'. We can now source the base unit (but with a slot for the HSPA modem rather than including the HSPA chip set) for around $US115.00 and we can probably find a suitable Huawei HSPA stick for around $A50.00 which would achieve the end user price of $A195.00 but wouldn't give an agent much of a margin on the 'box sale'.
However.....and I guess this might explain why the UK ISPs aren't offering the HSPA chip set built in to the 'magic box'....with 2,000,000 HSPA users already in Australia using HSPA modems there is quite a market for just selling the HSPA service to end users who already have HSPA modems to plug into a box. There is also the fact that HSPA modems are already being bought by the big carriers in the UK for something less than $US15.00 and it just hasn't been worthwhile for ISPs to source boxes with the chip set 'on board' - though there are more and more notebooks and laptops being built with the chip set included in the base device.
So it looks as though we can now get the 'magic box' custom built with the chip set included for something like $A185.00 landed and cleared in to Australia. However the ship date for that box would be still several months away and would miss our "Christmas Promotion" deadlines. On the other hand we could get the current version of the box (with just the slot) for a little over $A100.00 and sell it to people who already have their own (any brand) HSPA modem or we can provide our own HSPA modem at close to $A60.00 (inc GST) while we test market what the demand is for these units. Delivery may meet our Christmas requirement though it would be very tight.
In any event the hunt for the perfect device is reaching an end with only the buy price to be reduced to a sensible level which could be done in the short term by buying larger quantities than we feel comfortable with (and sell to other ISPs) or just rely on increasing manufacturing quantities generally to reduce the price. One way or another we might be in a position to make a decision immediately after we get back to Australia and then push ahead with a "Christmas" package of HSPA service, VoIP, Modem/Router/HSPA Device/ATA/WIFI that uses the customer's current telephone handset.
I think I said this last September?