Businesses must wait for better upstream speeds on DSL

Customers wanting uploads faster than 128kbit/s are a 'niche' market, Telecom says

Telecom says business users wanting ADSL upload speeds faster than 128kbit/s are in the minority and it will continue to target the mainstream business market with rate-limited plans.

Earlier this month Telecom launched three new business-grade DSL plans, although they are all rate limited to the 128kbit/s upload speed. Telecom still offers the original full speed JetStream plans it rolled out in 1999 with upload speeds of up to 600kbit/s, but the price has remained unchanged since those plans were introduced. The price difference between the new rate-limited plans and the older full-speed plans is dramatic.

The fastest of the new plans, 2Mbit/s download speed with a 15GB monthly cap, costs $149.95. The older JetStream 10,000 plan, which offers at least 2Mbit/s download with the faster 600kbit/s upload speed, and includes 10GB of traffic per month, costs $905.78 with an excess charge of 10.7 cents per megabyte.

The Commerce Commission appears to agree with Telecom that 128kbit/s is fast enough for business users. The unbundled bitstream service (UBS) it defined last year also sets upstream speeds at a maximum of 128kbit/s.

Overseas, upstream speeds for business connections are typically faster than 128kbit/s. For example, Ihug's parent company, iiNet, offers its iiBroadband2 "medium" plan in Australia with 12Mbit/s download and 1Mbit/s upstream speeds, with a 40GB monthly traffic cap, for A$70 (NZ$75) a month. Telecom's best DSL business plan offers 8Mbit/s download and 600kbit/s upload speeds with a 30GB traffic cap for NZ$2,417.78 each month.

However, Telecom's head of internet and online marketing, Chris Thompson, says faster upload speeds aren't important to most business customers. "It's easy to over-estimate demand for niche products like that."

Thompson won't say whether Telecom could increase the upload speeds in the future. "We don't comment on future plans but we're targeting the plans where the market is, and currently the vast majority of new sign-ups are in this area," he says.

But several customers who have contacted Computerworld are frustrated by the 128kbit/s upstream limit.

"I need to send data as well as receive it and frankly 128kbit/s isn't even broadband," says one engineering user who did not wish to be named. He routinely receives CAD design files on his broadband connection but cannot send them to others because of the slow upload speed.

"I end up burning them to disk and carrying them in the next day. It just shouldn't be that hard," the engineer says.

Thompson says there is relatively little demand for such services in New Zealand.

"The growth is all at the entry level and to be honest, Telecom probably made a mistake with launching [the full speed JetStream plan] in the first place." Thompson says the new business plans are targeted at the majority of New Zealand's small businesses, which need cheap, reliable internet access for email and web-surfing and not for file transfers of this type.

"If that's what they want to do they're going to want a more managed service anyway so we'd look at things like leased lines or a more high-end solution."

Another user describes the lack of movement on pricing in the past six years as "ridiculous".

"Why any business would use a DSL plan from Telecom, when for a few thousand more setup cost you could have a frame relay connection with Orcon and a 512kbit/s duplex dedicated pipe almost uncapped for less than $1000 per month, is beyond me".

Telecommunications Users Association chief executive Ernie Newman says the business need for greater upload speed is important. Users wanting faster uploads may be a minority, he says, but that doesn't mean their requirements should be ignored.

"Most business do have a higher download requirement than an upload but there are some that do need more. It's always going to be niche but it's a vitally important sector of the business community."

Newman says businesses like publishing or engineering would both benefit from having access to greater upload capacity and to shut them out of the gains to be made by using broadband is bad for the economy as a whole.