John Linton's Personal Musings

John Linton

February has been a very good month for Exetel (although it's not quite over yet) with new ADSL applications over 30% higher than February 2009 and all but SMS all higher than February last year. Corporate Ethernet/SHDSL sales were 100% up which continues the pleasing
development of building the corporate business aspects of Exetel's overall business. So a really solid month with excellent prospects for
March and beyond. I still have no idea what the results reported so far mean - other than ADSL was very 'flat' in the last six months of 2009 but without seeing what TPG reports and with the ABS figures not available until the last day of March there is not going to be any 'reliable' information until 9 months of the current year has already gone. (talking of reliable information the ASX reports filed by M2 and Macquarie Telecom rival iinet for questionable statements that omit significant 'facts').

So what does it all mean? ADSL is slow/static/falling for more than one or two suppliers with Telstra perhaps suffering the worst as the largest provider always will - they have the most to lose in terms of the largest number of users paying absolute top of the tree pricing for bottom of the ocean services and inclusions. It's also looking as though the 20 years of 'bundling' services is reaching an end with the long beloved wire line telephone line rental and 'low cost' (that's a laugh) telephone calls so threadbare now even the dumbest of the dumb buyers can see though it. Trying to 'bundle in' mobile telephone services is now becoming the last gasp in that particular con but it is not going to be very easy to shear the sheep until they bleed for that much longer. So while the total mess that is the 'NBN2' continues to eat away at communications
abilities in Australia what is to be done - particularly over the balance of this financial year and beyond?

In trying to work out what is happening there is one good thing, assuming we are reading it correctly, in that AAPT and TPG's ongoing blanket advertising of "unlimited broadband" (though you have to say the TPG wording is not exactly ethical) is that the customers churning away from Exetel are, not unexpectedly, the people who use the most downloads with over 90% of the ones who left to go to either AAPT or TPG in February so far being in the top 2% of 'down loaders' on the Exetel network. Although these churn aways only represented much less than half of one percent of Exetel's total customer base the effect on our 5 gbps network was noticeable and allowed us to do something unheard of in our six years of operation - we actually reduced the Sydney bandwidth by 150 mbps! Now 150 mbps is not much in terms of the total NSW bandwidth (around 3%) but it costs us over $A10,000 so the additional 'profit' is very large as a percentage. It is not that important in itself but it is
something to be considered if it's going to be an ongoing trend. It's things like this that make the current scenario so very hard to understand in terms of demographic shifts caused by suppliers under pressure.

I like the ideas of offering back up wireless services with ADSL plans but, having looked at it several different ways over the past few months, we haven't come up with a viable way of doing it.
I am against bundling in general, although we have no choice in terms of the Optus ADSL2 plans, and I am hesitant about bundling wireless with wire line plans but there are several avenues that looked promising before hitting a dead end. Nil Desperandum - there is bound to be some solution if we just keep working on it.

John Linton

......but unlike MLK who aspired to bring about massive positive change for the benefit of a section of the American people.....Krudd's (increasingly precarious) dream of breaking every single promise he made to win a first term and doing absolutely nothing but negative things for three years yet still getting the ultra stupid electorate to vote him in for a second term of access to the trough. I read this, and several other articles with amusement this morning:

http://www.smh.com.au/business/government-and-telstra-caught-in-a-staring-contest-20100226-p8zw.htmlerren

The hyperbole of the normally more restrained Ian Verrender took me by surprise (sweat dripping from the brow, Russian roulette references etc) but what made me smile in this piece of 'comment', as in the other similar comments, is this stupid, and totally unfounded, assumption that the Krudd 'NBN2' nonsense is anything but a ludicrous piece of political nonsense. Verrender, like every other media commentator (whose knowledge of Australian communications is the same as Krudd's (zero) continue to make comments like this:

"where taxpayers foot the bill for a far more expensive fibre-optic network and Telstra shareholders find themselves with not just an ageing network, but a redundant one."

(last sentence in the article) when the fact is simply that an 'NBN2' can't be built without Telstra's participation at all. All Krudd, via Stupid Stephen, can do is huff and puff and make unconstitutional threats that will be over turned in the High Court and, along the way, ensure they lose the next election. There is no semblance of a "stand off" - there's simply a board of a private company, via its CEO, telling a bunch of socialist cloud cuckoo land wankers to "rack off". Stupid Stephen's (Krudd's) threats to effectively end Telstra's commercial life via not allowing them more mobile spectrum and 'repossessing' their Foxtel investment should get Stupid Stephen and Krudd sent to gaol; it is such an outrageous affront to constitutional law. To consider that Telstra would give in to such an empty threat (on which you may be sure they will have taken the very best legal advice) is just plain childish.

What Telstra, I would have thought, would be happy enough to do, is to find a way of getting a massive amount of money as 'compensation' for getting rid of an asset that is depreciating in value and has a life (nothing to do with building or not building an 'NBN2') of less than 20 years or so and presents significant funding, management and operational problems over that time. Doubtless Telstra will replace the CBD, then the capital city, then the regional city PSTN with its own fibre over that time and replacing the country/rural facilities at the very end with a ten years or so of technology development wireless services. An evolution of technology as has previously been the case. I'm sure Telstra would be happy enough with $A20 billion or so from anyone stupid enough to ante up that sort of money.

But all this begs the bleedingly obvious questions. As a newly created government agency hasn't got the ability to manage diddly squat - how do you create an entity that is capable of running a national network (in decline) from scratch for many years in to the future while you try and build another one? Hasn't anyone considered how hard it is to do either of those jobs singly let alone how impossibly difficult it is to do them in tandem? Being the quintessential back of the bus ticket 'planner' it appears Krudd has simply made the assumption that it's just a month or so of organisation chart design and a pair of metaphorical scissors with some bean counters agreeing a few numbers.

Given Krudd's demonstrable lack of management skills and his gigantic ego perhaps he is totally unaware of what the personnel involved who would have to be hived off in to a job security future of zippo would think about working in a job that had no future at all and would require progressive redundancies from day one? How many of the current copper network key staff would not be looking for another job the moment such a ludicrous scenario was rammed through some version of parliament? None? The PSTN will not last too many decades into the future but it will not be replaced by an 'NBN2'. However if Krudd continues with this particular stunt he will continue to destroy Australia's communications infrastructure (let's face it there is only one wire line infrastructure in the country and it is used by a large percentage of the population) and Krudd has absolutely zero understanding of how it may be replaced - apart from his meaningless desire to escape his broken promises mapped out on that tattered bus ticket.

Apart from the sheer impossibility of the logistics there is no conceivable reason why Telstra should be forcibly be dismembered to allow a disgraced and overtly lying political clown to try and remain flying round the world in self aggrandisement while the inept rabble he selected to manage the country continues to kill the population or burn their residences to the ground as well as......I am already over my word limit to list the stupidities and lying monstrosities perpetrated by the screech owl, little miss wrong the minister for the destruction of the environment etc, etc.

The only real question is whether the Australian population will be stupid enough to allow Krudd and his uneducated, lying rabble to finish the job of totally screwing up Australia's future?

John Linton

..........of the copyright infringement mess.

I see from the 'decision' by AFACTS's legal team to appeal the recent 'judgement' (wow - now there's a surprise) as reported here (and many other places):

http://www.itnews.com.au/News/168136,revealed-copyright-101-challenge-to-iinet-victory.aspx

that Cowdroy's (single judge not being stupid enough to make law) judgement will be appealed on the, always going to happen, basis that he refused to 'make law' in his capacity as a single judge in an inappropriate law. His judgment was, in fact, a simple explanation that current legislation and previous case law gave no basis for determining the issues brought to the court by AFACT. Duh.....only a dummy would have expected any other result.....including, I assume, AFACT and their inept legal team that made a dog's breakfast of achieving that result - only thanks to Cowdroy (and the inevitability of the scenario).

So now, hopefully using a much higher calibre SC (who fully understands the principal issues involved and is also a 'favourite' advocate in the higher courts) the real issues of law will be addressed and multiple judges will determine whether or not the current legislation, and previous case law, adequately covers the issues or whether they need, in their determinations, to 'make law' by deciding what down loading another person's copyright material actually obliges the various parties involved to do. Clearly there is an unsatisfactory situation, assuming you have a skerrick of morality within your being, when an ISP and its customer can use the service to obtain property that should be paid for without paying the owner of that property for it. Leave out the 14 year old's crapulous statements about 'rip off prices' etc - such childish nonsense doesn't get anywhere near discussions of law.

The only issue, which properly belongs within the purview of a higher court, is whether an increasingly common practice perpetrated by, perhaps, millions of Australians denies certain 'property owners' of their property illegally. There is no need for anyone who does not have an understanding of Australian law below the level of an appellate judge  to make any further comment- your views (my views) lack the competence to be listened to. I realise such a view would mean that the Australian media and every personal conversation on the subject is therefore rendered invalid but then it always should have been - having to listen to or read the puerile nonsense that has deluged the comms industry over the past few years is just plain a waste of space and intolerably boring. While only, in this 'round' of the scenario, the opinion of the appellate judges who will 'hear' the appeal  matters a damn the moral issues involved remain exactly as they have always been.

There is also a legal issue involved which either the majority of ISPs themselves, or perhaps their less than adequate legal advisers have overlooked/aren't competent enough to determine relating to the actual sending of copyright infringement notices received from a realistic source to the customers whose IP is allegedly being used to defraud the copyright owner. As the copyright owner only has the owner of the IP to contact regarding the alleged copyright infringement what responsibility does the owner of that IP have to deal with the allegation? Also, in the event that the owner of that IP does not pass on the copyright infringement notice to the temporary user of that IP what implication does that have - legally and morally....but certainly legally.....and what legal and financial exposure results from not sending the allegation of copyright infringement to the temporary user of the IP address involved?

Fortunately I'm not an SC specialising in copyright protections but the SC who provides copyright law advice to Exetel has raised those points in suggesting that it's in Exetel's best legal interests to continue to forward any allegation to the user of the IP referenced in the allegation. I wouldn't like to expose Exetel to some counter law suit from some person subsequently taken to court by a copyright owner because they are able to say that Exetel never advised them that one of their children was doing something illegal....particularly when the cost of doing so is miniscule...despite what any perjurer might say.

PS: Further signs that Krudd's stupid, lying adventurism is damaging Australia's communications infrastructure:

http://www.smh.com.au/business/telstra-doubts-prompt-fear-of-credit-downgrade-20100225-p5zd.html

John Linton

I have been invited as a 'knowledgeable panelist' to participate in a communications industry media seminar on the Gold Coast this coming Sunday. I doubt that I was invited for any other reason than the people running the event think that my views are usually diametrically opposed to the 'mainstream' pap dished out by the various 'industry luminaries' and other 'spokespeople' who take it upon themselves to portray the industry in some sort of fashion or other.The list of the other 'panelists' supplied to me is:

Scott Ludlum - Greens Senator

Ian Birks - AIIA

John Foreman - Competive Carriers Coalition

As you can see - not a selection of people that I have anything in common with (and I understand that is a base requirement of any 'panel') though a group of individuals that appear to have a lot in common with each other. (as far as I'm aware - Foreman is simply a lobbyist for two multinationals who has been trying to persuade Ludlum to support foreign interests over Australian interests over the last few months) I am not totally stupid and realise that invitations such as this (and I receive around one a month and almost always decline) are not an acknowledgment of my in depth industry knowledge nor even my understanding of the basic directions of the industry of which I have been a part since time immemorial but like most people with a relatively balanced view of life I seldom do anything that doesn't produce a positive result for my own, mainly Exetel's,  interests.

The topics of the questions provided, and I have no basis for knowing whether they are a complete set or even the actual questions that will be asked of the various 'panelists' - seem particularly pedestrian to me - all relate to the 'progress' made in providing communications services to Australian users since 51% of the electorate installed Krudd and the other associated uneducated rabble in the Canberra bunker or more general questions relating to how the current rabble have used IT/Comms as an end user. Questions relating to the NBN2, mandated filtering and the direction of communications can all be answered in short sentences of a very few words or require the understanding of a very large amount of detailed research which such a 'panel format' cannot possibly provide.

However, being a responsible person and having accepted an invitation to contribute some 15 minutes (at the most as I doubt my views will be sought other than to 'liven things up' if the dreariness and pomposity becomes overwhelming) of my views on these subjects I did some preparation last night on what I could meaningfully say - I struggled to come up with anything. I mean - what can anyone say about the Conroy/Krudd filter? That it was a quid pro quo to the religious crazy in the Senate for his support on emissions trading and that apart from being impossible to achieve it's a very poor concept in any sort of democracy? Alternatively, and despite the huge volume of 'positivity' from the media in relation to Krudd's political cover up known as the NBN2, what can be said about that stupidity other than if you believe in it you are certifiably insane?

So I was 'challenged' to actually understand what I could usefully say on the two issues that I have some detailed knowledge about....on the other nominated topics I have no knowledge or opinion. 'Speaking' about something is very different to writing about it - when speaking you can't include third party source url's to support what you are saying. However I took those two topics and jotted down what I believed to be their motivations, progress to date and likelihood of achievement over some 40 minutes of relatively rigorous thought and, try as I might, I just couldn't get past the fact that they are stupid political stunts one of which has no merit and the other has the potential to set Australian communications back by decades if not to destroy Australia's infrastructure.

As the 'audience' includes some 50 journalists from the communications media I am assuming that the majority of the 'panel discussion' will be questions from the floor to the various panelists which is of interest to me in getting a better understanding of how much Australian journalists know about the subjects they write about and how the different print media approaches their writing about communications. The balance of the attendees are described as "70 senior IT managers and IT professionals" and, again, it will be interesting to gauge their level of understanding of key issues concerning the 'NBN2'.

Maybe it will be just the waste of a Sunday.

John Linton

......a world where commonsense and logic are replaced by the shrill, juvenile voices of petty self interest proclaiming that their personal advantage and avarice actually are more important than the country's greater good. Where the forces of government seek to dictate that their naked need for re-election over ride every aspect of a situation of which they have no knowledge and less ability to begin to understand. Where debate is replaced by 'sound bite' attempts at manipulation and the 'big lie' is so continuously beamed to the population that no room or time is left for common sense. You're entering a world of shadow and smoke and mirrors, of things and ideas of which the people who proclaim them barely understand the words they utter let alone their concatenated meaning.......you're crossing over into the twilight zone......

....or that's what struck me about the ad I read earlier as reported here:

http://www.zdnet.com.au/news/communications/soa/Telcos-advertise-for-Telstra-separation/0,130061791,339301292,00.htm

Anyone who has ever read what I have written about Telstra would know that I am no fan of the way that company operated under the previous regime of El Sol and the bunch of American carpet baggers who screwed Australia in a reign of terror before they left with their mega millions but FGS who are these equally rapacious bunch of foreign Lilliputians  (and their Australian cat's paws) to use Australian customer's money to hype their own self interests? Perhaps they didn't read enough while growing up and never learned the lessons expounded by Jonathan Swift? Perhaps, like some sort of commercial hyenas, they simply sense a weakening prey and are attempting to make the most of the current situation where, literally, nobody has a clue as to what is going on....based on the statements they make that are publicly available.

Breaking up Telstra in this imaginery world created by Krudd's bare faced lies and his terribly dangerous interference in Australian communications (of which he knows nothing and cares less) is now being compounded by his even crazier attempts to use parliament to meddle with the structure of commercial operations in Australia by attempting to use legislation against one company to further its crazy and unconsionable political position. This is now compounded by three 100% foreign owned companies (Optus, Primus and VHA) running the ad referred to in the cited article. Is everyone OK with this cloud cuckoo land scenario? Are the lunatics really now running the asylum?

Assuming that enough senators reveal their total lack of credentials to make a decision on whether or not they should tie their shoe laces by voting in favour of Krudd's latest fairy tale then it's straight to the High Court for several years to put a stop to Krudd robbing Australians to enrich Chinese, US and Singapore companies in the most blatant misuse of parliamentary power for partisan political advantage in the history of Federation. You simply can't sell Australians a product (T1, T2 and T3) and then turn around and say "oops - now we've got your money we want to make your investment worth less". Though , obviously, if you are as hubristic as Krudd, then you can attempt to do exactly that.

Should Telstra have been sold as two separate companies in the first place? Probably no-one disagrees that should have been done, now, but the fact that it wasn't done also can't be summarily changed now without returning all of the money paid by the T1/T3 buyers of the shares on a one for one basis but as the share price of $3.00 yesterday is a far cry from the prices charged originally then Krudd would have to add another $A18 billion to his deficit to fund that acquisition....I don't think he has any credit left. That is the only way that Telstra's operating future can now be determined - it can't steal from Australians by stealth or, in this case, legislation that makes over 1,000,000 Australians instantly poorer (or alternatively lose the whole value of their shareholding by being denied any future spectrum) so that a bunch of lunatics (masquerading as the Australian Federal Government) can pursue some totally idiotic socialist incredibly expensive pipe dream.

It's now long past time to call a halt to yet another Krudd Kraziness (the NBN2) before, like so many of the stupidities attempted by this nonsensical rabble it just doesn't kill Australians or burn their homes down it impoverishes a million voters and destroys the Australian communications infrastructures as well as the commercial investment system.

For what benefit?

There isn't one.

John Linton

I scan read the iinet results on the ASX yesterday:

http://www.asx.com.au/asxpdf/20100222/pdf/31ntpcrp20fstq.pdf

which were issued with the usual misdirection but one thing was clear - iinet's ADSL growth has slowed to virtually nothing along with Telstra's and Optus previous announcements. This is based on the statement in their ASX report that says that they achieved 22,300 net new ADSL customers in the sixth month period ending 31st December 2010 which means that Exetel contributed more than 10% of iinet's growth via our purchases of ADSL2 through AAPT (and presumably AAPT's own orders plus those of their other wholesale customers contributed much more than that) so actual retail growth of iinet's 'retail' ADSL2 business can be presumed to be virtually nothing. Contributing to a 'competitor's "growth" is something I will have to look into. iinet make no mention of any amounts of wholesale ADSL2 customers. Because the graphs depicting the "off net" are not quite clear (in terms of 'Westnet' acquisitions/movements) it's hard to work out what is happening with the 'absorbtion' of that company but it's probably past the time it really matters.

Any way - nothing to see here - move along. It will be interesting to see TPG's results when they get released next month plus the ABS figures on March 30th to complete the picture of the 'current' state of the ADSL marketplace.....right now "flattish" looks as though its an optimistic assessment.

I noticed the first, pretty feeble I thought, attempts by Telstra to 'lower' their HSPA prices by giving a 1 gB 'sign up bonus' on their pre-paid plans. Sometimes I wish I had the 'marketing dollars' that larger companies have to attract new customers with 'give aways' rather than having to rely on the least cost of service over a reasonable period of use. These sign on down load bonuses are the most cynical piece of rip off the customer flim flam yet to be used by the carriers and their resellers. How can something free be a rip off? Because it encourages the customer to down load more than they usually would thus setting a pattern for over use in the future.

I also read the brief announcement that David Spence had been 'dispensed' with as Unwired's CEO and guiding light after 6 years of trying to get WiMax off the ground in Australia. As either the first or second wholesale customer which in the two years before we stopped selling new services became by far the biggest Unwired wholesale customer (and still with a few hundred of our once many thousands of Unwired network customers) I was sorry to see that attempt at introducing WiMax as a major wireless alternative into Australia fail so badly and fritter away some many hundreds of millions of dollars. I suppose it was unintentionally ironic that in the same paper that Kerry Stokes was merging Channel 7 (which owns Unwired and Engin) into his heavy machinery business - not, I would have thought a move that shows confidence in the future of communications by Mr Stokes. Another minor indicator that the 'consolidation' of the suppliers of residential communications services continues to occur.

The rest of the communications media yesterday remained as bland as the previous week with nothing indicating any serious, or even semi-serious, decisions being made by any company. Perhaps the combination of the hiatus introduced by the 'NBN2' ramifications and the 'death' of the ADSL market places has produced a state of 'innovation' exhaustion over communications land? Maybe I'm reading the wrong media but it seems that there is less 'novelty' in the business than at any time I have been associated with it. I re-examined the AAPT unlimited offer to see if I could determine what was going to affect Exetel and came to the conclusion that, generally, it is a good situation for us as a residential ISP. Looking at the usage profiles of the Exetel customers that have churned to AAPT since the introduction of the original off peak unlimited AAPT plans the usage profile of customers who churned to AAPT (and there were surprisingly few) all, but 2, were very heavy off peak down loaders and the first few who have churned since the announcement were very heavy down loaders in both off peak and peak. If that becomes true for all ISPs then AAPT will have an interesting few months....but as I flippantly remarked to a colleague yesterday when we discussed these figures "Unlimited down loads are like unlimited petrol for $100.00 - there are only so many miles the majority will drive in a month irrespective of whether the petrol price is zero after their first 1,000 kms".

Maybe I'll regain my inspiration soon.

PS: One more example of Krudd's dishonesty/duplicity/inability to actually do anything at all:

http://blogs.theage.com.au/triage/archives/2010/02/yourhealthbodgyrushedgovau.html

John Linton

It seems as though the year is already speeding past with the end of February already 'in sight' which means that 8 months of the current financial year have already passed. Business remains very solid for Exetel in terms of order intakes and customer retention ratios and actuals for almost all of our ten products and services. I read the various international and national media on my 'research list' more thoroughly than usual this morning as I have been away for a week but I didn't see anything of any interest - in fact it was all very 'ho - hum. Perhaps it's just the time of year with the business world only recently returned from holidays and not many people 'into the swing of things' yet....perhaps Australian communications is just going through one of its boring phases? Alternatively the various communications providers are trying to second guess each other in trying to make their various offerings more appealing and haven't worked out how to do that yet.

I received a surprising number of requests for meetings this week which is unusual because I meet with very few people during a business week on average as I have very little to contribute to other people's businesses and very few people have very much to contribute to ours. I have no way of knowing whether this is a 'trend' in business to business relationships but it appears to me that there have always been a lot of unnecessary 'meetings' associated with business life and over the last few years I have wondered whether the true benefits of web sites and email have really 'sunk in' to the business processes of many companies we deal with. Perhaps so many meetings are needed to fill in the average business day for too many people? I have also noticed that many meetings seem to involve far more people than can possibly make a positive contribution to them and in many cases some people attend meetings without opening their mouths - except to yawn. I have a very low threshold of tolerance of meaningless talking with a result that, throughout my business life, I have always avoided meetings other than those with prospective or current customers which always have a clear objective recognised as useful by both parties.

Then again, perhaps I am the exception in relying too much on the 'written word' to obtain information in general or specifically and I would learn more if I had more face to face meetings with informed and erudite people - which is my particular problem because I don't seem to come in contact with too many of those in my working life. The few people I do meet with on a regular basis don't seem to find the same difficulties in filling their days with meetings so I am getting the feeling that I need to change my working habits to build more meetings into my working week - which brings me back to my prospective meeting list for this week which, if I agree to meet with the various companies that requested meetings, I won't have time to do carry out the various daily tasks that are 'locked in' to my working day....and as far as I can see are essential to be carried out.

Within Exetel we have a lot of 'meetings' between various people but our meetings tend to last a few minutes at a time with few meetings lasting more than 20 minutes and the average length being probably half of that. Most of our desk to desk communication is via email as it usually needs to copy various other people and is dealt with 'instantly' - for the most part. The casual walk up to someone's desk and 'meet' provides the rest of the inter personnel communications. We have very few meetings with our suppliers or advisers and in the case of our smaller suppliers we almost never meet with them. Perhaps this is an inevitable end result of our policy of trying to automate every aspect of our business dealings - perhaps we just, as a group of people, have got used to written communication as the sensible way of communicating?

Though I really do wonder whether any of the meetings I have been requested to attend this week will benefit Exetel in any way. Perhaps as I get ever older I am becoming too careful with the time that remains to me?

PS: it seems that more and more of the media is waking up to Krudd's lies and stupidities:

http://www.smh.com.au/opinion/politics/how-rudd-the-dud-dropped-australia-in-the-alphabet-soup-20100221-ontz.html?rand=1266756351043

PPS: I emailed all the requestors for meetings this week and politely declined all of them.

John Linton

We got back to Sydney yesterday evening after an uneventful flight though Annette picked up some sort of virulent bug and a very high fever so her flight was very uneventful as she slept all of the way. She is still very ill today so let's hope it proves to be a transient bug and not some insidious tropical disease. One of the penalties of frequent, but short, visits to countries where health hazards are very different to those we encounter in Australia.

I read Friday's AFR on the flight home and on page 63 there was an opinion piece written by Simon Molloy of Systems Knowledge Concepts ( I have never heard of the man nor the company so I have no idea of his credentials) head lined:

"Upwardly mobile: more bad news for the NBN"

As I started reading the article I found myself in total agreement with what was being said and then it struck me - the article was almost a direct copy of a blog I wrote a few weeks ago right down to the sources I had so meticulously cited and the numbers I had used to illustrate the point and even came to the same conclusions as to how the NBN would most likely become a Telstra dominated re-monopolisation of the wire line communications in Australia while wireless had already made the 'NBN2' completely unnecessary. As I doubt that anyone would plagiarise anything I have written the most obvious scenario is that more and more people are beginning to see the 'NBN2' for what it is (Krudd's political stunt to cover up his lies and promises made to win the last election) and more people are beginning to see the obvious dangers of Krudd's Kraziness in meddling in issues of great importance about which he and Stupid Stephen know Sweet Fanny Adams.

Irrespective of what any vested interest based opinions come from the mouths of the nay sayers the figures remain compelling evidence that Australia has no need of an 'NBN2' any more than it has a need for 12 submarines or 48 billion dollar a piece military aircraft. These are student union idiocy type decisions reached late at night over too many funny cigarettes and cheap flagon wine - "wouldn't it be great" type immature idiocy but in Krudd's case capable of de-railing Australia's communications infrastructure for decades. It won't happen because the numbers say it can't happen and while Krudd may get away with the next election and therefore blindly persist in this 'NBN2' stupidity for another 4 years all that will happen is that more billions of tax payer's dollars will be frittered away, less investment will be made in fibre infrastructure than otherwise would have been and country and rural Australia will continue to buy wireless broadband to meet their data and voice call needs.

Whether or not Telstra will continue to develop its fibre network which it appears to be doing remains to be seen. However there is a pretty compelling business case (in every country in the world) for fibre to be used in densely populated areas and for wireless to be used in less densely populated areas. Telstra was clearly following this path before the election and has pretty much continued to follow it post Krudd's "Ascendancy" while arguing that the only sensible way forward is for the government to give it the money to extend its capital city based fibre to regional Australia while it provided high speed wireless services to rural Australia.......and that makes perfect sense (except the bit about the government funding Teltra's fibre monopoly.

In the mean time the value of the current Telstra PSTN infrastructure and its revenue base continues to fall and fall more quickly as each month passes. That makes the 'government/Telstra' negotiations ever more pointless as without transferring Telstra's monopoly to the NBN monopoly none of the figures work at all (not that they ever did). The reality is that an increasing number of Australians (including "Australian working families") are dumping fixed line communications 'forever' as they use their mobile telephones and mobile data (increasingly) to ditch both the excessive costs of wire line services and the inconvenience of 'fixed point communications' in an ever more mobile Australian life and work style.

Perhaps, as Molloy suggested in his article, it's time for Krudd "to announce to the nation that technology has moved on since his election promises and that Australian consumers are voting for mobile".

....and pigs may fly.

John Linton

We are heading home in a few hours having stopped over in Singapore again due to the difficulties of getting reasonable connections to and from Australia to Sri Lanka. I keep in regular touch with what is happening in Australia whenever I am away mainly through our GURUS management system and, of course via many, many emails and the occasional phone call. We have had a very good week in Australia with ADSL setting a new daily application record after we returned the application fees to their previous levels which is the first time we have ever set a 'record' for ADSL applications in a February. We have also made our largest ever business sale (and surprisingly this was made in Tasmania) which is really nice to see as another indication of how our young business sales force is maturing and how they continue to out perform their much more 'experienced' competitors in all sorts of situations. So they were both very satisfying 'events' to have been achieved in a week that in the past 6 years has never produced very much of interest.

Assuming the last week of February stays on the same 'tracks' as the first three weeks we will have another consecutive record month (despite the 28 days) which will be a really good result in these more difficult times in terms of ADSL market saturation and the beginning of the series of 'initiatives' by all sorts of communications companies to address their first six month shortfalls in terms of both their sales/revenue levels and their profits. I have referenced the AAPT 24 x 7 unlimited ADSL2 plans but there are now signs that several other ISPs are trying to make changes to their offerings. I think it will be another ten days or so before new initiatives from Telstra and Optus become clear but the rest of the publicly listed ISPs will report their half year results in that time and the December 31st 2009 half year report from the ABS is due next week.....which will shed more light on ADSL progress in Australia.

We keep building out our Australian network in terms of upgrading edge and core hardware and continually, as we always have, increasing the amount of customer connectivity and IP bandwidth we deploy. The stronger dollar has helped us a great deal in buying much larger routing and switching power over the past year which has provided us with much more flexibility and at least two new capabilities that our multi 7300 architecture never allowed us to do. These new facilities plus the new caching provided to us by both Akamai and two of our other caching suppliers continues to push the cost of a gB of IP ever lower as the months go by. Interestingly the two new multinational IP providers that have been 'tiptoeing' around supplying IP in Australia are getting a little more committed and a little braver and it will be interesting to see what IP pricing will begin to be offered over the balance of 2010. Our current buy prices of 'raw' IP are now falling well below $A100.00 per mbps with the caching contributions driving the per mbps price to well below $A30.00 for the first time in our operating history.

Our costs, as a relatively small communications company, can't approach the much lower costs of a company like AAPT (which allow them to offer their unlimited plans) and nothing like the costs enjoyed by Telstra and Optus but they currently look like falling by around 40% from our bench mark buy prices in 2009. If that in fact turns out to be the case then it will give us some interesting opportunities if we can work out how to use this scenario to our benefit. Of course the benefits that Exetel may derive from these circumstances will also be enjoyed, and to a greater extent, by all of the companies with which we compete so they may not give us any real advantage other than we don't try and make as much profits as our competitors do.

As always after a few days in Sri Lanka I feel invigorated and I am looking forward to getting back to Australia and seeing first hand what has changed in the week I have been away.

John Linton

and start the zig-zag trip home in a few hours.

We wound up the Exetel SL review about 30 minutes ago with a quiet dinner with the SL general manager. Earlier in the day we signed the new lease for 6,000 sq feet of office space on the 25th floor of the East Tower of the World Trade Centre building where we have operated (on the 9th floor) since June 2008. We obtained a remarkably good deal, for whatever reason, and will get double the space on a much higher (theoretically more expensive floor) for not much more than we are paying now. I'd like to claim credit for being a really good price negotiator but I doubt that's true. We also signed the contract to move our current operation from Level 9 to Level 25 at a much lower total cost than had been quoted and we arranged to move banks to get the benefit of lower operating charges so we had a very good 'financial' day. I suppose the reality is that we were true 'babes in the wood' when we first came to Sri Lanka and we are now, having learned the hard way, paying more realistic prices for things than we did when we first came here some two years ago.

Although those financial 'accommodations' were a pleasant surprise the real benefits from this review have come from the discussions on how to improve the rate, width and depth of the knowledge transfer processes. Moving 6 key operating 'departments' from one country to another via recruiting 40+ people whose knowledge of the products, services and processes was zero is not the easiest task in the world to try and accomplish. I think that, via the amazingly effective hard work and dedication of everyone concerned we have pretty much accomplished those very, very difficult tasks. Perhaps our total lack of experience of carrying out such a transition and our total ignorance of how to go about it has assisted us, in a perverse way, as we just used common sense and ignored the difficulties in setting up and operating a new company 10,000 kms away from 'home' and have been rewarded with a sophisticated company larger than the Australian operation it supports.

We have discussed, debated, mutually agreed and now established the twin targets of zero TIO complaints and zero 'unnecessary' support calls as the bench marks for the next two years of the Sri Lankan company's existence. This is to be accomplished by a unique new knowledge inculcation process and measurement system/set of processes that, while as far as I'm aware, have never been put in place by any other company seem, at least to me, to have the potential of solving everything that is 'wrong' in operating a 'support' function for a relatively complex service. At this stage it's only a concept and it may well turn out to be impractical but it seems, at least logically, to have more likelihood of success than anything else I've ever become aware of.

In case that sounds totally stupid or, worse, perversely coy, let me simply say that if every customer had all the knowledge, tools and capabilities of the most knowledgeable and experienced 'help desk' person - why would they need to call a 'help desk person'? So we will continue the long process of putting in pace the tools and 'instant' answers to any possible support question in a way(s) that the end user, irrespective of their knowledge/experience level can access and radically increase their own ability to diagnose and fix whatever problem they encounter.

Pretty simple really. Why haven't the millions of call centres around the world ever done this? I have no idea. Perhaps they work in a world where a call centre is a given as being necessary part of the company they work for? I don't really give a damn either way as I have had a stimulating, and I think productive, few days looking at really difficult, even complex, scenarios and have, through sensible discussion reached some stimulating conclusions on how to radically improve how Exetel provides better, and quicker, support solutions to those of our customers who need them.

I believe it's going to be possible to ensure that a much higher percentage than 60% of our customers will have no need to call a 'support person' in Exetel in 2010 - and that would be a very good outcome of a few day's discussions.

John Linton

...has only just occurred to me.

Following Steve's recent visit Annette and me are in the process of completing the review of the current situation of Exetel Communications (Pvt) Ltd which is a larger company (in terms of employees) than Exetel Australia is and that has been in existence for less than two years. It has been operating in Sri Lanka for a little over 18 months but currently out performs the Australian company in almost every respect in terms of international standards of operation. It has an amazing track record of being profitable from the first month of its existence and completely complies with every regulation and country edict regarding operating in Sri Lanka and has surpassed all of those requirements in every aspect.

Having completed the first two days of the scheduled three day review we are yet to find any anomaly in the Sri Lankan company's operations. We will meet with the company's accountants and auditors tomorrow to discuss all aspects of legal and statutory compliance but we don't expect those meetings will 'turn up' any 'problems'....as the previous meetings have failed to do. For anyone who has ever set up a business in a foreign country perhaps this realisation is 'chicken feed': and in general business terms this is probably the case. For Annette and I it is a sudden surprise that without really thinking through what we were doing we have created a bigger company than Exetel Australia in a third world county in a very short space of time that is, in some ways, better than the company we have struggled to create over the last six years in Australia.

You may very well think that this situation is mundane and not worth commenting upon. I mean, what's so difficult about establishing and growing a company in a third world country 10,000 kms from Sydney? Absolutely nothing because it's done all the time by companies all over the world. Undoubtedly that's true in many respects for many people and entities. Until a few minutes ago I didn't think of what we may have accomplished in Colombo as very different or in any way exceptional either. But now I do. It actually is exceptional that we have established a company bigger than Exetel Australia that delivers a wide range of services to Exetel's Australian customers better, and 'nicer' and much more efficiently than we ever managed to do from Australia. I'm sure many other Australian companies have achieved far more than we have achieved in understanding how the 'global economy' can make the delivery of products and services in a particular country more efficient. All I can say is that Exetel had no previous experience of making that happen and I am now amazed at how well we have achieved whatever it is we have achieved and how quickly we have put that in place.

Exetel in Sri Lanka has more employees than Exetel in Australia and makes a month on month profit while contributing to both the 'human' well being of Sri Lanka (paying its employees far above the 'standard rates') as well as endowing scholarships at a major university, providing funding for a 'chair' to develop AI and providing major funding to protect the Sri Lankan Elephant as well as reducing Sri Lanka's dependence on foreign imports of milk products. All of this has been brought into being over a period of less than two years. From the view of a commercial company that's a pretty impressive achievement in any terms....let alone doing it in tandem with building an Australian company in a very tough set of Australian marketplaces.

So what does it mean? Not a lot to the people who look at Exetel as a company that doesn't do much and that has survived longer than it should have. What does it mean to the people who have invested their personal time in being an Exetel employee or director? It means that they have contributed to a pretty unique 'corporate' development that has been immensely beneficial to two countries and almost 120,000 service end users and to their own personal and professional development. Until today I, who should know better than anyone else, hadn't realised just how much our tiny company has contributed to the economies of two different countries.

John Linton

I spent an interesting first day in this trip to Colombo reviewing various aspects of providing residential support and checking on the progress bench marks we set for this financial year. The 'news' is generally very good with the call wait times for 'support', provisioning and sales all dropping month on month over the past almost eight months and showing every sign of reaching the average one minute wait time by June 30th 2010. That, if it's achieved, will be quite a remarkable effort.Of course that is simply one bench mark out of many that may be achieved. Answering a customer call faster on average than any other Australian communications supplier is only the first step along a very long road.

We spent much of yesterday discussing ways of improving the knowledge of all personnel across the different 'disciplines' and how to both broaden and deepen the knowledge required. We also spent time discussing how to implement the 'assessment' of what progress each person was making in increasing both their personal knowledge and their abilities to deal with the 10 'personality types' they provide service to. That of course is a never ending program but we need to improve, and very quickly improve, our methods of making this happen.

We have also made some substantial progress towards the real key objective of any 'support' organisation which, as far as I am concerned, is to reduce the number of calls made in any twelve month period by 80% of the user base to zero - in other words the service never 'breaks down' or if it does there is no need for the customer to actually speak to 'support' to rectify the problem that is occurring. Now you may well think that is a pipe dream (of a particularly strong batch of opium) but if you look at the various circumstances it could be achievable. Currently the average number of calls per customer per year is sitting around 1.5 using rough arithmetic with over 60% of customers never making a call in any given calendar year. Reducing the number of calls per customer only becomes an exercise in analysing what causes customers to call and to eliminate those reasons - simplistically put but no less valid for being put simplistically.

Over the next two days we will address how we will implement more sophisticated processes of acquiring the key data that our support employees don't have at the moment and how we will use that data to help us reduce call sources and improve resolution times. Obviously the 'hard core' calls all involve our carriers and improving response times across a variety of 'down' situations is not entirely under our control. However we have found that with two out of our three major providers we can get sensible suggestions implemented over time and there is no reason that 'carrier problems' can't be addressed in the same ways that problems totally under our control can be addressed.

We also had the first session of reducing TIO complaints to zero which is a very difficult task, principally because, the TIO simply doesn't obey the regulations and processes set out in its own constitution which causes almost all of the problems with which Exetel is confronted and, I assume, with which any other communications company is confronted - but I obviously have no knowledge of that. We have formally advised the TIO that we will be taking legal action against the TIO as an entity and some individuals within the TIO personally for what we see to be their personal malfeasance, gross negligence and flagrant breach of their constitution under which their actions are set out. We are in the final stages of documenting, in the detail required by our lawyers, 306 gross breaches of the TIO constitution that represents systemic non-functioning of the TIO as an organisation and deliberate corruption to obtain money with menaces by several individual TIO employees.

Our intention is to eliminate all TIO complaints by the end of this financial year by ensuring that the TIO ceases generating false complaints and by ensuring that the false complaints generated by customers are dealt with in a way that eliminates the TIO becoming involved in the ways they have to date. We will produce our, very finely documented statement of claim against the TIO before the end of March and either get agreement that they will 'cease and desist' and remove the obvious 'bad apples' from their employment or we will ask a court to make a determination of the matters documented. What we won't do is put up with the current situation.

It was a productive day.

John Linton

......look like the the political stunt it always was.

I read this earlier this morning:

http://www.smh.com.au/technology/biz-tech/telstra-doubles-next-g-speeds-in-record-upgrade-20100215-o2bt.html

not in the context of anything wonderful but just as the typical technology advance that is associated with any technology - technologies just keep evolving to meet ever more demanding requirements. It always surprises me that the dummies who comment about wireless broadband seem to have come down in my grandmother's "last shower of rain" in making their comments about how "wireless bandwidth will never be enough for ADSL users" and "wireless speeds will never be enough for ADSL users".

Are they really so ignorant of the development of technology generally, and communications technology in particular, that they have forgotten or have no knowledge of the evolution of data over copper? Have they forgotten that in the very early 1970s that the speed of data transmission was 2400 baud (remember that word usage?...used by Emile Baudot when he was pioneering the development of data transmission in the first years of the 20th century). 2400 is close enough to bits per second which began to replace baud as the bit transfer rate leapt to an incredible 4800 bps in around 1972. Of course by the time 'commercial' internet emerged in the early 1990s the rate had doubled again and throughout the dial up internet 'era' it kept increasing until it was a massive 56 kbps!!!! )f course knowledgeable people were aware of the Bell Labs development by two young engineers in Chicago in around 1992 of commercial modems that could deliver 2 mbps x 2mbps over the same copper lines and had been selling those services to business customers in Australia for over a decade before Telstra finally got around to introducing their super fast residential internet service at a massive 512/128 kbps.

So now residential internet can run over copper at 20 mbps down and 2 mbps up in ideal conditions some 40 years after it began to be used in Australia but the dummies (who may well have come down in the last shower) don't either know anything about wireless technology, don't bother to inform themselves before commenting or are, well, just dummies in every aspect of communications technologies. For those with less than total short term memory loss you will remember that it was only an election ago that Krudd thought promising 12 mbps speeds to 'most' Australians  within 5 years was a pretty amazing election winner. I was one of the few really stupid people who said that wireless would deliver those speeds to a lot more Australian users in a lot shorter time and at no cost to the tax payer. Currently there are something like 3 million wireless broadband users, a fair number in rural and regional areas, paying a lot less than the prices mooted for the 'NBN2'  - well BEFORE THE FIRST 'NBN2' USER HAS BEEN ACTIVATED!

Telstra's  'stunt' announcement today/yesterday is irrelevant other than it illustrates how fast wireless broadband technology is moving and, with the testing of LTE in Australia later this year by both Telstra and Optus how quickly it will continue to move. It is not beyond reasonable possibility that there will be more wireless users than their will be ADSL users before the first 'NBN2' mainland user is activated - and that will have been accomplished without a single tax payer dollar being spent....let alone several tens of billions or whatever the current wild estimate is.

For the nay sayers (who have zero knowledge - just a couple of unattributed sould bites) the 'NBN2' has become a reality before anyone has either costed the build and ongoing maintenance or sorted out how enough customers can be found to make a sensible (non-government subsidised) selling price even vaguely attractive. The amount of column inches printed saying positive things about the viability (financial and commercial) of Krudd's face saving stunt would probably reach from Sydney to Alpha Centauri and back - and every one of those column inches have almost certainly been written by a 'journalist' who hasn't got even the basic understanding of communications technologies or Australia's communications user bases and their requirements and their financial limitations.

What would happen if Krudd spends the future of Australia on a pipe dream network that nobody wanted to use?

John Linton

....but still has steps to go before 'reforming' the Australian broadband experience.

I stated my admiration for AAPT's new offerings last year when they introduced the 12 hour unlimited period and commented that it would only be a matter of time before they introduced a 24 hour unlimited offering. So today's:

http://www.dailytelegraph.com.au/news/no-cap-on-broadband-downloads/story-e6freuy9-1225830271942

announcement (or was it yesterday's? - I'm in Singapore and my times are offset by three hours) is unsurprising in the highly competitive ADSL marketplace that is reality now and for the foreseeable future. As I commented before their were two major turnoffs in the 12 hour offerings - the 5 gb 'peak time' limit and the price. In this step forward AAPT has removed one major limit but have still priced the offering far too high for it to actually blow the market apart - but then there are many steps in a 'revolution' and you can seldom change a commercial market with your personal "Bastille Day".

You would have to think that AAPT's planners have looked at the success (or if you're very cynical) lack of success of the 12 hour unlimited plans and adjusted those plans to the new offers based on their experience to date so they would have addressed what they saw as holding back even higher take up than they previously achieved. Unlike any other company except Telstra and Optus they have far more 'off peak' capacity than any other provider in Australia. How this might affect their 'peak' capacity is also something only they know and no-one else can guess at.

So - the price point. Not really that exciting I wouldn't have thought and, based on my own very limited knowledge and experience, it isn't going to be a market breaker. I actually do understand that the concept of "unlimited downloads" is a powerful phrase - but just what market demographic it appeals to is not clear to me - my guess would be less than 1% of the approximately 6 million current buyers....around 60,000 end users who actually no ISP wants as customers, even at $100.00 per connection and even at AAPT's internal costs this plan will almost certainly run at a loss for that 1% of users. But, of course, I don't have access to AAPT's actual usage figures for their current plans so they may well have facts that show that my assumption isn't correct. My view of the ADSL residential market is that once you charge more than $A40.00 a month for ADSL the market becomes 'resistant' with $A50.00 a month the maximum for any acceptance - beyond $A50.00 the market fades away to tiny percentages which are fine in today's markets but are almost not going to be fine as 2010 wears on.

Of course, I could be totally wrong and AAPT's announced new pricing could be exactly correct. They do have a great scenario with their network configured for massive day time use that dwindles to almost total idleness in the 'off peak' period and an owner (NZTel) with a 50% share in SX. There is also their 15% or so shareholding in iinet and the constant rumours that NZTel are looking to buy out Amcom that would be a precursor to buying out iinet which would provide an interesting set of marketing opportunities. But, and it has to be a but, how many users actually will buy an internet service for $100.00 a month in Australia in early 2010? Not that many when there are unlimited ADSL1 plans available already (despite the Telegraph's head line) and there are significant price/download changes coming from Telstra and Optus in the almost immediate future.

Irrespective of the price, which can be changed at any time, AAPT has set the benchmark for 'download limits' in Australia and the price for that 'standard' will remain a benchmark as 2010 progresses - unless the 60,000 users who consider 300 gbytes to be a minimum requirement all flock to AAPT - in which case some rethinking may be required.

PS: It's nice to be back in Singapore even for a brief stop over to follow up a contact and get a first hand idea of what is going on around the region. It is, as always, so much more impressive than any Australian city in its cleanliness and unbelievable levels of efficiency that we can only dream about in Australia.

John Linton

........can't be any worse than coping with other aspects of the Australian communications industry.

In an hour or so Annette and I will leave to fly to Sri Lanka for the quarterly review of the Exetel operations in Colombo. We first went to Sri Lanka at about this time in 2008 to begin the process of setting up a full scale operation and to hire two more 'work from home' residential support engineers to add to the two we had had since February 2006. (we also were hoping to meet Sir Arthur C Clarke and get a book signed for Steve who is an avid fan of the great man).

Since that first visit, during which we somehow managed to get all of the basics of setting up a new company in a very difficult location put in place as well as meeting Sir Clarke (as he is referred to in Sri Lanka) in his hospital suite where he died a week or so later, we have returned to Colombo for a few days each quarter to formally review progress and to get a 'feel' for what is actually happening in the country, the city and our tiny operation there. Like the Australian company, it has been interesting to see the development from the bare floor space we looked at on our first visit with our first four SL personnel still working from home in February 2004 and remembering the almost incredible frustrations of dealing with the many government, legal, accounting, fit out, banking, telecommunications, real estate and other  personnel 'long distance' between our first and second visit in May to get the company established.

Over the two years that have elapsed since our first visit we have come a very, very long way thanks to more than a few of Exetel's Australian personnel who have gone to Colombo on specific knowledge transfer programs and for the three longer term assignnees who have spent 6 - 12 months at a time  to ensure the daily operating procedures and processes are successfully put in place. We now have 45 full time personnel in Colombo with a locally hired general manager and a bigger office than we have in North Sydney.

This will be our eighth trip to Colombo in the last two years in which we have seen the bare concrete floor space become a sophisticated 365 day a year communications centre staffed by very highly skilled personnel. We have achieved much more by offering services from Colombo that we ever could in Australia simply because we can afford to hire the number of people required to provide the additional services and keep to our objective of offering the lowest priced services in Australia (any service provided at no more than one dollar profit per month).

Our principal objectives for this trip are to put in place more sophisticated QOS measurements for the different call types and to ensure that the continuing 'mechanical' improvements to call wait times, call talk times and call abandon times remain on track to allow an increase in weekend coverage hours and that the 'platform' is in place to move the operation to a 24 x 7 x 365 in the FY2011 year. Many things need to be done/improved before that can happen and it will be interesting to see what has been accomplished since we were last there in November. Steve wasn't very pleased with what he saw when he was in Colombo last month to participate in the formal setting up of the Model Dairy Farm Project so my expectations are not high.

A minor thing that we have to do is to decide on how we deal with the space issues. Although we added about a third more space last July there is now no real room for much more growth. This is mainly due to our decision not to use the 'hot desking' principal of the majority of multi shift call centres but to provide a dedicated work station per employee. It is also due to our decision to use 'professional' standard work space size and free space per employee ratios that are almost never used in call centres anywhere in the world that I have seen them and certainly not in Sri Lanka where the original fit out people two years ago suggested that we could get "at least twice as many work stations in to the floor space". I am reluctant to move the operation to another floor/another building even but we will make that decision next week.

It will also be interesting to gauge the level of 'tension' on the streets of Colombo after the brief euphoria of bringing the decades long civil war to an end only to face a military coup following the arrest of the popular (at least with the troops) leader of the opposition.