[Fwd: Hello from the Chief Architect!]

[Karun Dambiec]

Hello Karun!

I just spotted your posting to the Linux user group and thought I'd
clarify something ... it may also give you a better answer to the
questions you were posing on Monday at your class.

TransACT isn't operating as an ISP - we leave this to others. The
problems in pricing all happen at the ISP level.  ISPs have to buy th
content they import from overseas from upstream providers, ultimately
ending up with major operators like Telstra who charge them amounts like
10-15c per Mbyte. So for an ISP to give you a 3 Gbyte quota could leave
them exposed to a 3,000x15c=$450 bill (!) if all of the 3 Gbytes came
from overseas rather than out of cache etc.

If you break down Telstra's ADSL service, you come up with some
interesting observations. Consider the "access" part of it - that is,
the ADSL link that gives you the 256Kbps performance. Telstra rents just
the copper wires to support this service to third parties for around $60
per month ... this is without any equipment to make it all go fast! If
you deduct just this $60 amount from the $73 that Telstra charges for
its bottom-end ADSL service, your left with a cost of just $13 for the 3
Gbytes quota.

This is where the distortion lies ... not in TransACT's pricing for the
access part (which is just $16 per month at the bottom end), but rather
in the cost of content. Some of the ISPs have raised complaints about
what appear to be unfair, monopolistic practices by Telstra, but thus
far there haven't been any breakthroughs.

In terms of access pricing, TransACT pretty much represents world's best
practice. $16/month for a permanent 256 Kbps link (ie: about 6x dialup
speed) is pretty attractive compared to the price of renting a line and
making many 22c calls every day.

I hope that this helps!

Regards ... Robin Eckermann