wonk v3.0

ISP battle leaves thousands with reduced Net use (Techworld / Matthew Broersma)

From the article: “A dispute between two of the Internet’s biggest service providers has exploded into the public arena after a large number of business and consumer customers saw their Net use curtailed.

The first customers knew of the dispute was on Wednesday morning, when ISP Level 3 terminated its peering agreement with Cogent. The loss of this direct link meant that a portion of each network’s users could not contact anything hosted on the other network, including websites, other types of servers and e-mail addresses.”

This sort of thing is never pretty. Fortunately for people in Australia there should be no impact on traffic because domestic providers who buy traffic from the US typically multihome to 2 or more networks.

Telstra in need of a big technological fix to stay in the game (Sydney Morning Herald / Rod Myer and Garry Barker)

From the article: “New chief executive Sol Trujillo will release his strategy to transform the telecom next month. The transformation could take three to five years to really pay off but timidity and slow movement are no longer an option as Telstra struggles to re-engineer itself to meet the realities of technological change.

The old copper network yields Telstra a whopping 60 per cent profit margin but customers are deserting it. Ian Martin, telecom analyst with ABN Amro, expects land-line revenue, which fell from $8 billion in 2003-04 to $7.5 billion last year, will drop a further 7 per cent this year to $7 billion.”

The last mile copper network is Telstra’s biggest asset by a long shot. Virtually all DSL based connections sold in Australia rely on Telstra’s copper to reach into the household of office of the customers. The high wholesale cost charged to ISPs and other carriers for the use of the copper is driving them towards alternative technologies such as wireless. Some of the newer wireless providers such as iBurst and Unwired have no such dependencies on Telstra for reaching their customers enabling them to provide services at a lower cost. If Telstra does nothing to address this trend their largest asset will become irrelevant.

Telstra hastens ADSL2+ (Australian IT / Andrew Colley)

From the article: “ Telstra has not announced a launch date for its high-speed DSL service, but The Australian understands that the carrier plans to make them available to its retail and wholesale customers across 400 exchanges in late September.

The Australian understands the carrier has taken a conservative approach with its ADSL2+ access plans, offering speeds of 3Mbps and 6Mbps.”

Personally I doubt Telstra will do very well in the market place with such low speed plans. The current ADSL1 spec is capable of speeds up to 8Mbps downstream which makes me wonder why Telstra would commit to such a large capital expenditure if they’re not going to offer higher speeds than their current infrastructure can deliver.

Telstra stalls on DSLAM migrations (Whirlpool / Phil Sweeney)

The article above described some of the difficulties faced by ISPs when trying to move customers from Telstra Wholesale ADSL services over to their own DSLAMs. According to Simon Hackett of Internode Telstra have inflated the costs of performing the migrations and are not allowing ISPs to have their own technicians perform the work. The ACCC is looking into the issue.

ACCC weighs up ISP regulation (ABC News)

From the article: “The Australian Competition and Consumer Commission (ACCC) will monitor the activity of Internet service providers (ISPs) for the next three years as some smaller providers push for greater regulation.

It noted that “ISPs do not have formal contracts, do not know their traffic flows, and have great difficulty in specifying their revenues and costs”.”

While some of the above line is true, I think it is also a case of the ACCC being interested in data which the ISPs would not normally need in the day to day running of their businesses.

The need for speed (The Age / Adam Turner)

The Age has some coverage about the soon to be available ADSL2 standard which demonstrates some of the uses for the much higher bandwidth which will be available.

Telstra to spend $210m on ADSL upgrade (The Age / AAP)

Telstra has allocated $210 million to upgrade their DSLAM network to the ADSL2+ standard. I find it a little odd that they’re spending so much money on this project when they don’t utilise their current ADSL equipment to anywhere near its maximum throughput. The ADSL1 specification allows for speeds of up to 8Mbps downstream, however Telstra cap speeds at 1.5Mbps. It will be interesting to see if they allow greater speeds under the new standard.

ACCC hits Telstra … for $6.5m (The Age / Bridie Smith)

From the article: “Telstra has avoided fines of more than $300million after allegations of anti-competitive behaviour relating to its wholesale pricing of broadband technology were investigated by the competition watchdog.

In announcing the decision yesterday, following a year-long investigation, the Australian Competition and Consumer Commission ordered Telstra to rebate $6.5million to its affected wholesale customers and reduce its wholesale digital subscriber line (DSL) pricing by January 1 next year.“

This is certainly a very disappointing outcome for the ISP industry and consumers in general. When you’re a company the size of Telstra $6.5 million can easily be written off as a cost associated with attracting new customers. An advertising expense of sorts. Clearly the ACCC is unable or unwilling to tackle Telstra and ensure fairness in the industry.

Email problems hit Telstra users (The Age / Sam Varghese)

According to the article Telstra customers were suffering email problems between 5:12am and 11:30am. This follows on from the major email problems Telstra had last year resulting in some customers unable to receive email for days. Telstra provided no specific reason for the problems yesterday.

iiNet to Acquire OzEmail (Yahoo / Press Release)

From the release: “With OzEmail’s 230,000 active non-casual customers, including 47,000 broadband users, and 65,000 active casual customers, iiNet’s total customer count will grow overnight to more than 620,000. With OzEmail’s customer base being largely on the east coast, the deal will add further clout to iiNet’s aggressive DSLAM network rollout across Australia.

iiNet will make a cash payment of approximately $82.6 million (USD) to MCI.“

That’s a lot of cash. iiNet could have bought several Comindicos for that price but it appears they are more interested in the consumer market. This seems to be a growing trend with the owners of Dodo Internet recently selling off their wholesale business KBS to Wholesale Communications Group to focus on the retail market.

In other news wireless network provider Unwired has announced the have picked up 17% of new residential broadband connections in Sydney in the 4 months from 19 August 2004. This translates to 13,766 users, most of which were obtained directly through retail channels.