[clug] Transact whinge, was "broadband ISPs in Canberra"

[Alex Satrapa]

On 25 Sep 2004, at 23:20, Andrew Smith wrote:

> On Sat, 2004-09-25 at 14:24, Kim Holburn wrote:
>> TransACT with their VDSL is trying to compete against ADSL which is a
>> much cheaper technology when they could offer 55Mb to the home.
>
> This would have to be my biggest gripe with the Transact offerings.  
> Why
> do they insist on competing eye-for-eye with Telstra's products, when
> they could breeze in and guzump them with "the most advanced network in
> the world."

1) TransACT has to pay for their infrastructure somehow
2) Your choice is between TransACT and Telstra ADSL, so there is no 
reason for them to set the price too low
3) People want to compare oranges with things that look like oranges
4) If TransACT was to preemtively lower their prices, how long do you 
think it would take for Telstra to unleash their war chest? Drop 
installation to $0, set the first three months to $0, and watch as 
TransACT loses customers hand over fist for three months (and never get 
them back, 'cos they're locked into 24 month contracts with 100% exit 
fees).

> I work closely with several customers who have Transact's Virtual 
> Router
> (ISP) product.  Incredibly, Transact even follow the Telstra delivery
> model there, including rate-based charging for bandwidth into the ERX
> for telehoused customers, in the _same_ premises a floor apart.

It doesn't matter whether you're in the same building or across the 
country, the bandwidth has to be provided throughout the network. 
Bandwidth between colocated machines and end users still has to be 
provided by the TransACT network out in the streets. That's what the 
rate based charging is for - budgeting not only for cable installation, 
maintenance, expansion and replacement, but for the work it takes to 
keep the network going. It's a pricing model that people who have dealt 
with Telstra take for granted, so why shouldn't TransACT mimic it?

There is such a thing as being *too* innovative when it comes to 
dealing with bean counters and muggles.

Alex

"If knowledge can create problems, it is not through ignorance that we 
can solve them."  --Isaac Asimov