Telecom has revisited its commercial unbundled bitstream service (CUBS) offer to ISPs following revelations about the service's specifications.
As reported in Computerworld,ISPs were asked to sign a contract that required all ISPs to agree not to seek a regulated alternative from the Commerce Commission, reduced the aggregate traffic cap for users from 10GB per month to only 4GB and included a number of other changes to the existing CUBS offer.
Chris Dyhrberg, Telecom's head of wholesale marketing, says providers now have a choice of staying on the existing pricing model for CUBS backhaul, or moving to the new one. He says that some providers whose customers were getting close towards 10GB a month data usage on average were not ready for such a big change so soon.
However, Dyhrberg points out that the new backhaul charging is cheaper for providers whose customers use large amounts of data. Under the existing pricing, up to 10GB is provisioned per customer, with $2.85 per GB levied for data usage over that limit; the new model has a lower cap, 4GB, but also lower excess charging at 50c/GB.
The cut-off point at which the new model becomes cheaper is 11.2GB average usage per month. With 20GB average usage, the provider pays would pay $28.50 a month per customer if on the old scheme, but only $8 on the new charging. Should the average usage reach 40GB/month, the figures are $85.50 and $18 respectively for the different charging methods.
Dyhrberg says it costs Telecom money to provide backhaul circuits, and that the charging is to recoup the costs. The new method is an effort to spread the costs fairly amongst providers, so that those with customers who use a lot of data pay more.
However, ISP Association of New Zealand (ISPANZ) president and Ihug general manager of industry and regulatory affairs David Diprose says that with Asynchronous Transfer Mode (ATM) interface costs on top, Telecom already charges too much for the backhaul. An overage charge should not be necessary Diprose says.
Telecom's use of ATM circuits for the backhaul was labelled as "from the dark ages" by one ISP. Dyhrberg refutes this statement and says ATM is used worldwide. He adds that CUBS was always based around it because the Commerce Commission specified ATM for its regulated service, which Telecom's commercial proxy is modelled upon.
Also, Dyhrberg says that Telecom offers faster circuits than 155Mbit/s such as a 622mbit/s one currently installed at Orcon for its CUBS traffic. Some providers want backhaul delivery over Ethernet instead of ATM, and Dyhrberg says this is on Telecom's roadmap and should be available early next year. It is not cheap and easy for Telecom to implement Ethernet however, as the DSL equipment is ATM specific and has to be replaced he says.
On the Shared Cost Network to Network Interconnection (NNIs) for its ATM circuits, Dyhrberg says Telecom has made them available to providers. However, providers haven't taken up the sevice, Dyhrberg says. He says providers have to be realistic and understand that the circuits won't come for free however.
Asked how the UBS negotiations are going, Dyhrberg says that some providers have already signed up. He won't say who they are or how many, but adds that they will not be disadvantaged for signing up early, should negotiations with other providers create improved terms. Dyhrberg also promised the plans would be available on April 2.
However, neither Dyhrberg nor Telecom spokeswoman Sarah Berry would confirm that any provider has signed up, when quizzed on this at a later date. Likewise, the April 2 release date is now no longer certain. In a written statement, Berry would only say "As we said, we're in negotiations right now - we're aiming for the first week of April - there's a lot of work underway to make the changes we're bring in - but the results will bring a lot of improvement for broadband end users and that is a good news story!"
Diprose says that to his knowledge, no ISPANZ provider has signed up for the new CUBS. The main sticking point in the negotiations according to Diprose is Telecom's "standard take it or leave it" approach. He adds that Ihug is seriously considering seeking a determination for a regulated service instead.