Top Stories: - Getting there slowly - FTA KIA ULL OK? - FryUp readers rule

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- Getting there slowly


- FryUp readers rule

- Getting there slowly

It's official - Telecom can do nothing right. Telecom's just launched a new 256kbit/s JetStream service that comes in three flavours: a 1 GB/month cap, a 3 GB/month cap or a 10 GB/month cap. The first two have excess usage charges of only 5 cents/megabyte instead of Telecom's usual 20 cents and the 10 GB service has no excess charges at all. How so, you say? Well, Telecom will throttle the connection back to a less acceptable speed, although it hasn't said what that will be.

Nice, I thought. This sounds like the service it should have launched back in September when it announced the woefully pointless 256kbit/s symmetrical service. (The new 256kbit/s service has an upload speed of 128kbit/s. Got that? There will be a quiz later on.)

The new service doesn't seem to have a name as of yet. I'd fully expect the old new 256kbit/s service to be dumped entirely as this one supersedes it quite nicely. It says to me the old new 256kbit/s service hasn't exactly been wowing the punters, and who can blame them. Slightly cheaper than JetStream Starter but without a high traffic limit, it made no sense to any of the JSS customers who use a lot of bandwidth to make the move.

Still, I am waiting for Telecom's 512kbit/s and its 1Mbit/s service before I dump my full-speed JetStream. I do like getting the information at a decent clip and downloads are a breeze with this kind of connection speed.

Of course, one day soon I'll be asking for about 100 times the speed so I can use my line for voice, data and video, but the odds of that being in New Zealand and in a price bracket anyone on the average wage can afford are (I would say) slim to non-existent.

So the service itself is fine, in isolation. Looking at the bigger picture, it tends to cause squeals of excitement from the ISP industry.

You see this new 256kbit/s service is very similar to the one proposed by the telecommunications commissioner in his "we don't need unbundling because there's already plenty of competition" decision. Should the decision's recommendations be implemented, Telecom will be obliged to wholesale a service that is at least 256kbit/s downstream and no more than 128kbit/s upstream to its ISP competitors.

J'accuse! cried the ISP industry. Telecom's just trying to soak up all the keen customers before we get a chance. Yes, it does look a bit like that on the surface, doesn't it?

Interestingly, Telecom has started offering a $10/month discount off the price of its JetStream service for customers who take their tolls through Telecom as well. Other companies do this, so I'm not too worried, but in its press release on the matter, Telecom put up the wholesale rates it would be selling the service for and that's of greater concern.

Telecom is selling this service to the other ISPs at a wholesale rate. Well, it's the retail rate minus $10. It gets away with this because that's the amount Telecom says it adds through Xtra support. Help-desk, anti-virus and anti-spam filtering and so on.

That doesn't seem like a lot of money really, when you consider it. At $10 per customer per month, there's not a lot of wiggle room for ISPs to, y'know, make a living there. Some of the ISPs charge $20 a month for their services and they'll have to consider either cutting back to match Telecom's rate or losing customers.

There's also the entertaining idea that Telecom's only introducing a 10 GB/month plan for residential (current plans are capped at 1 GB/month for full-speed JetStream or 5 GB/month for JetStream Starter) following pressure from Microsoft. Microsoft, you may recall, is trying to get Kiwis to play Xbox Live, its online gaming platform that needs at least 256kbit/s each way to run properly. (Although now it says 128kbit/s is fine for the upload side of things. Sound familiar?.) Microsoft, don't forget, already has a strategic relationship with Telecom on many fronts, including the failed esolutions business unit and the XtraMSN portal.

And just when you thought it was all over bar the shouting, TelstraClear, Ihug, CallPlus, Slingshot and Compass Communications launched their "Call for Change" campaign demanding a chance to compete with Telecom. The companies' aim is to raise awareness at a grass roots level so they've targeted Telecom's line rental price as the easiest issue to explain. In areas where TelstraClear offers its own line rental prices, Telecom matches them street by street. This is competition and it's how it should be - lower prices being met and battled over.

Good. Of course, Telecom can take advantage of its national network and wear the cost for those few streets while TelstraClear can't because it doesn't have a national network. So Telecom's half-yearly result looks rosy and includes dividends for shareholders while TelstraClear's is growing at around 3.5%.

Telecom has put out a statement rebutting the "Call for Change" point of view, of course. I'd link to the press release but it's not on the Telecom media site yet.

From the statement: "Telecom works hard to provide as close as possible to flat rate pricing for line rentals throughout the country. But because competitors have cherry picked some areas Telecom has had to respond in those areas."

Again, this is called competition - cherry picking is a term that really gets my goat. Of course they're cherry picking - everyone in business wants the best customers. How absurd.

Telecom announces new JetStream pricing - Computerworld Online

Telecom's pricing moves branded "a joke" - Computerworld Online

TelstraClear unimpressed by Telecom's wholesale promises - Computerworld Online

Cheaper broadband coming - NZ Herald

Telecom rivals say customers paying too much for phone lines - NZ Herald

TelstraClear falls short of growth target - NZ Herald

Telecom delivers higher payout - NZ Herald

Call for Change website


Hey, here's a good one. In TelstraClear's submission to the minister over the commerce commission's decision not to recommend unbundling (I really need some kind of shorthand for that) it says the US government demands countries that want a free trade agreement (FTA) must unbundle their local loops before Uncle Sam will grant them one.

Simple, really. If you want to have an FTA you need to unbundle.

Now, putting aside for a moment whether a bilateral FTA works (and I have strong misgivings about such a beast when you're the smaller of the two countries involved), doesn't it seem to suggest that this is the kind of thing governments all over the world are doing as a standard operating procedure? This isn't some crazy political experiment that only the weirdo few are engaged in - quite the opposite.

Just about every place that has a telecommunications infrastructure (mainly the OECD countries), there is unbundling.

Actually, I have to apologise here. I've foolishly not checked up on just which countries and have repeated the claim that there's only New Zealand and Mexico. It's not quite true - as of September last year there were seven: New Zealand, Mexico, Czech Republic, Slovak Republic, Poland, Switzerland and Turkey. However, of those, the Czech and Slovak Republics are planning on joining the European Union so they have to unbundle; Poland has just introduced legislation that will mean they unbundle as well; the Swiss government is fighting legal action from the incumbent (go on with you, the incumbent? Resisting unbundling? Never!) and may well have just won, meaning the Swiss will unbundle; Turkey is considering it once its monopoly is liberalised at the end of this year and even Mexico is considering a line sharing agreement.

Only New Zealand has reviewed the situation and decided to recommend against unbundling.

If that's not proof enough that we should be unbundling, consider the World Trade Organisation (WHO).

New Zealand is party to the WTO General Agreement on Trade in Services (GATS) that states signatory countries should unbundle their telecommunications infrastructure.

US-based trade association CompTel/ASCENT Alliance is urging the US trade representative's office (USTR) to raise the issue with the New Zealand government.

"The [Commerce Commission's] recommendation fails to enforce New Zealand’s Reference Paper Section 2.2 commitments, and the USTR should encourage the New Zealand Government, an important trading partner, to reject these recommendations."

The association says the Commerce Commission's recommendation on unbundling falls short of the WTO requirements on many levels.

"Specifically, ComCom declined to require cost-oriented unbundling of the local loop, declined to require cost-oriented bitstream access to the incumbent’s DSL services, and finally, declined to require cost-oriented pricing and non-discriminatory access to local leased circuits."

I've just spoken with a chap from the US Embassy in Wellington who says that in general the US approaches FTAs with the intent of making as many of its wishes stick as possible and that unbundling and access to telecommunications in general is an area the US would "strongly insist" be included before any FTA is signed.

International pressure on unbundling grows - Computerworld Online

What Will The Aussie FTA Do To NZ's IT Industry? - Aardvark

-Aardvark Thursday's story - hit the "previous edition" link to reach it

Commissioner's unbundling bungling - NZ Herald

Anderton: never say never - Computerworld Online

Working Party on Telecommunication and Information Services Policies - OECD September 2003 (PDF)

- FryUp readers rule

As if I needed reminding of the fact. I got a couple of emails about last week's well-thought-out, reasoned discussion (okay, bleat-fest) about online stories not being eligible for the Qantas Media Awards.

The first, quite rightly, told me to pull my neck in and that the reader figures would be enough to quench my thirst for recognition. It's true - there are well over 3000 of you receiving the email each week and countless more reading it on the IDG website -- at least, you would be if you could find it (sorry about that, the techs are working on restoring the FryUp to its rightful place as the lead story on the website in big font so nobody can miss it).

And while I must say in my own defence that really I wasn't just talking about the FryUp but all the online news stories that I read (and write) that are deemed "unworthy" by the Qantas folk if not New Zealand journalists in general, that's a good point. The readers are the key, so I'm grateful for you lot showing up each week.

Then, to prove what a progressive and determined lot you are, I got another email from a reader who had contacted Barry Young, the man who runs the Qantas awards, getting him to concede that one day in the near future they would have to admit online news stories to the awards because, well, it's the future of news. Huzzah! The problem, it seems, is lack of sponsorship. So if you're a corporate reader who looks after such things, feel free to check out the Qantas Media Awards site and give Barry a lot of cash. Tell him I sent you.

In the meantime, I'll just revel in having stumbled on a publishing medium that can generate such a response. Email is such a personal, immediate medium that I don't understand why more publishers aren't jumping on the bandwagon. I think of email as an inclusive communication tool and judging by the replies I get each week, so do you. Better than blogging, that's for sure.

Now, how to make some money at it. Ah, there's the rub. See you next week.

Qantas Media Awards website

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