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How much for business broadband?? 16 November 2004 Edition
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Telecom has taken to patting itself on the back a bit recently and, if you take things at face value, those pats might be deserved.

However, if you look a little deeper you might change your mind.

Take for example the upgrading of 256Kbps JetSurf accounts to 2MB.

Ignoring the effect this has on other ISPs who were gearing up to launch UBS-based services, this is surely a wonderful thing for customers right?

Well you might think so -- but have end-users actually seen a benefit from this alleged 2Mbps speed?

A week or so ago I noticed that some large downloads were whacking along at a pretty impressive rate (well over 130KB per second and realised that my connection had been upgraded. "Woo-hoo" I thought.

Subsequently I've found the service to be *very* patchy however and there is clearly some major over-commitment of bandwidth associated with these higher speeds.

While I get reasonable speeds during off-peak hours and even now (at 8am) things are ticking along quite briskly, by 10pm at night my DSL connection is actually worse than it was at 256Kbps.

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Last night I had a couple of periods where it just stopped dead and I found that I'd suddenly ended up with a new IP number (a real hassle when you're logged into a service that doesn't allow concurrent logins from the same IP and which has a 10 minute time-out on each connection)

Throughput during the evenings is way below 2Mbps and latency seems to go right through the roof.

If I were, like most people, someone who spent most of their online time browsing the web of an evening, this "upgrade" would actually be a downgrade in terms of service levels and performance.

It would appear very much as if switching from 256Kbps to 2Mbps has cost Telecom nothing because no additional bandwidth has been provisioned to ensure that users will actually get the speeds being advertised.

Nice one Telecom!

And then there's the MED report on just how well Telecom's prices shape up against the rest of the world.

Not a pretty read -- but not news to those of us who have known how poorly NZ's telecommunications compare with those of our peers.

Of course Telecom have subsequently criticised the report for not taking into account the recent changes to many of their pricing plans, including that 2MBps broadband service (that isn't).

Another thing to consider before patting Telecom on the back over recent customer-focused changes to its pricing regime is the way business is left paying through the nose for broadband connectivity.

While we sit at home and pay $69.95 (incl GST) (home-user prices) per month for an allegedly 2MBps connection with a 10GB cap, spare a thought for any business that wants the same kind of deal.

If a business wants something faster than 256Kbps, (business prices) they won't pay just $70 per month for "full speed" DSL with a 10GB cap -- no, they'll have to pay anywhere from $80 for a 600MB cap to $905.78 (plus GST) for the same 10GB that a home user gets for just $69.95. In effect, business users are paying more than TWELVE TIMES as much!

And, if a business wants to go over that cap, they pay anywhere from 9c to 18c per megabyte (plus GST) -- yet the home user pays just 2c for the same over-cap MB. Once again, the business customer is being stung -- this time up to NINE TIMES as much as a home-user.

So, while Telecom is happy to tell us that they're hiking speeds and slashing prices for DSL -- nobody, certainly not the mainstream media, seems to be pointing out this astounding anomaly between residential and business pricing of the same services.

Telecom insists that its broadband pricing is no longer out of step with that of other countries -- but they don't seem to use those business prices in such a comparison do they? It would appear that the "cheap" residential psuedo 2Mbps service might just have been a cunning way of spinning the real facts to Telecom's advantage.

And where's the government in all this? Where's the Commerce Commission??

The government acknowledges that reasonably priced broadband connectivity is crucial to this nations competitive in the 21st century -- but surely that means our businesses must also have access to such a resource.

The fact that a business is being charged twelve times as much as a residential user clearly indicates that someone is being roundly gouged and the fact that government hasn't come down with an iron fist on this gross profiteering leaves this commentator once again wondering who's sleeping with who and what kind of secret backroom deals are perhaps going on between those purporting to represent the bests interests of taxpayers/voters and those with total control of the country's only nation-wide DSL broabdand network.

Of course it probably doesn't hurt any that Telecom spends a very goodly amount of money (some $23m according to their 2003 annual report) on sponsoring Helen's darling child -- "The Arts".

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