Money Question

tHE vAGGABOND · 19-09-2001 3:29pm #1

I read post after post moaning about the price they want to charge for ADSL..

The standard and quality of SNL went down the toilet the more popular it became, as time went on. It became overloaded, and most nights people could not even get on for ages, if ever...

What if they said that SNL was now £50 or £60 a month. Esat would have money to reinvest in the service, keep up quality and *gasp* make a profit. These companies are in the business of making money - all tech business exist to make money for someone. They are not charities, or bottomless pits of money.

Same deal with Eircom, they want to/have to make money - but they also want to have money to reinvest in the service..

I had this same fight with friends in the US a few times, and loads of DSL companies were really cheap - but in the end 99/100 of them have muppets working for them, not decient techies and over time theysimply went out of business.

Simple economics folks, there are not enough people over here for unlimited DSL for £20 (or whatever) a month. Its going to be a bit more expensive, and it will take time to evolve.

Another point is that 3 gigs a month should be fine for the average home user, most home users if you think about it. Its more than enough. These companies dont want people who download mountains of warez/p0rn/divx's.

chernobyl · 19-09-2001 3:54pm

The 3GB cap is fine for ppl who surf the net with a 56k modem and are happy and do it as frequently as hell freezing over.
if im gonna get Eircoms i-$cream then it will have to be the unlimited.
i wanted to get Beams 2 way sat, but have recently started to CS a bit and need the speeds/LPB that DSL has.
im gonna bite the bullet as soon as my exchange is good to go.

SkepticOne · 19-09-2001 4:01pm

Originally posted by tHE vAGGABOND
I read post after post moaning about the price they want to charge for ADSL..

The standard and quality of SNL went down the toilet the more popular it became, as time went on. It became overloaded, and most nights people could not even get on for ages, if ever...

What if they said that SNL was now £50 or £60 a month. Esat would have money to reinvest in the service, keep up quality and *gasp* make a profit. These companies are in the business of making money - all tech business exist to make money for someone. They are not charities, or bottomless pits of money.

Esat had to pay by the minute to Eircom. That is the reason they kicked the 2,000 people off. It was not their own running costs but their failure to negotiate with the Eircom "last mile" monopoly. I believe the subject of paying more for nolimits was taken up by the committee with ESAT.

Same deal with Eircom, they want to/have to make money - but they also want to have money to reinvest in the service..

What makes you think they want to reinvest in the service? Where is our guarantee that that is the case?

I had this same fight with friends in the US a few times, and loads of DSL companies were really cheap - but in the end 99/100 of them have muppets working for them, not decient techies and over time theysimply went out of business.

That is the same with any business. If you have muppets running the business, then you don't deserve to be in business. Many of these DSL companies overextended themselves during the boom years when money was freely available. When the return wasn't quite as much as they had hoped they went under. This is normal in the business world.

Another point is that 3 gigs a month should be fine for the average home user, most home users if you think about it. Its more than enough. These companies dont want people who download mountains of warez/p0rn/divx's.

I am not against caps in principal but you neglected many legitimate uses such as software downloads, gaming, etc.

yellum · 19-09-2001 4:05pm

If 3 gigs is enough for me the home user, what do I need broadband for ? I might as well go back to tin cans and strings. People are being punished for going on the net instead of being encouaged.

I'd readily pay more for surf no limits if it was to mean Esat was happy with the situation. However they can still make a profit with the current fees if Eircom bring in FRIACO.

Theres plenty of people for cheap DSL here. The amount of bandwidth coming into the country is massive. Its getting it to the end user where the bottleneck lies.

Also isn't one of the aims of this forum to get cheap broadband access for everyone ? Complaining about how expensive broadband is is one of the traits of this forum. The forum is about complaining and getting our complaints heard so that things may change. Its been fairly sucessful so far. What good would not complaining do ? It'd be a very quiet campaign if people didn't do anything.

infomat · 19-09-2001 6:31pm

Originally posted by tHE vAGGABOND
I read post after post moaning about the price they want to charge for ADSL..

The standard and quality of SNL went down the toilet the more popular it became, as time went on. It became overloaded, and most nights people could not even get on for ages, if ever...

Simple economics folks, there are not enough people over here for unlimited DSL for £20 (or whatever) a month. Its going to be a bit more expensive, and it will take time to evolve.

Another point is that 3 gigs a month should be fine for the average home user, most home users if you think about it. Its more than enough. These companies dont want people who download mountains of warez/p0rn/divx's.

As far as I am concerned you are mistaken if you think that this debate is little more than a few people moaning about unlimited ADSL ... it is much more serious than that.

As the whole World Order is about to change and as there is now a strong indication that many companies are planning to reduce their travel budgets and use telecommunications as a substitute for face to face meetings the demand for broadband access will rapidly increase. Companies are now re-considering all sort of alternatives including teleworking but currently very few people in Ireland could afford the cost of access.

Within a short period of time broadband access will become essential to anyone in business and if the problems with Eircom are not rapidly resolved we will as a country be on the wrong side of the digital divide.

I never had any problems with SurfNoLimits regarding quality of service and I was a very heavy user so I don't agree with your comments (I am not saying what you said is untrue but it is not universally true). If it was true that the standard of the SNL service declined as it became more popular then one can only conclude that Esat were being unfair to their customers as it was Esat who operated a service which they were unable to fund they must also accept responsibility for creating false expectations regarding pricing.

In principle I want a package which offers me always on access at a reasonable price and as I prefer to plan my expenses I prefer to know in advance what I will be required to pay so I am willing to pay a premium not to have a cap.

My problem has little to do with money (from my end) but everything to do with availability ... for about two years I have tried to get access via Esat (I was very happy with SNL), NTL (it would appear that I won't even get their new Go Digital Service until the end of next year) and Eircom.

Eircom have promised ADSL for close to three years and now after trying every trick in the book not to introduce the service they have introduced a number of expensive packages. As soon as I made the decision that I had no option but to sign up with Eircom for ADSL they indicate that they may not make ADSL available.

I never expected Eircom to offer ADSL at £20 per month and would be very worried if they did (I don't want to repeat my SNL experience) but by the same token I do object to being over-charged (be aware that the ODTR has decided that they are over charging).

I also object to the silly games that Eircom are playing.

I should mention that while price may not be the major problem from my point of view I am upset by the fact that the general public may be put at a major disadvantage because the do not have access to the Internet at a reasonable price.

R. Daneel Olivaw · 19-09-2001 6:40pm

Originally posted by tHE vAGGABOND

Same deal with Eircom, they want to/have to make money - but they also want to have money to reinvest in the service..

And the money they are asking for (such as the massive monthly basic fee) is akin to a fee as if they spent millions INVENTING the bloody internet. They say it cost £127 million to get it up and going.....

Average cost to get this thing installed in a home is, what around £400 I read in another post (£200 or so for Ethernet/USB, 1st month, installation charge).

£127,000,000 / £400 = 317,500

So they need 10% of the population to get it installed. That is around 1 in every 2-3 homes. Now tell me, do you think 1 in every 2-3 homes would use the internet?

The statistics published show exactly that. Around 30% usage, compared to 60-70% in the US, around 50-60% in the UK. They were in some report in the papers a few weeks ago.

But don't take my word for it. Do more math:

£1116 (12 month contract)
£189 (comms device.....why they don't insist you also pay more "equipment rental" is beyond me)
Total: £1300 for the year, roughly (excl. installation)

£127,000,000 / £1300 = around 98,000 installations, and only for 1 year as well, to recoup ALL INVESTMENT COSTS AFTER ONLY 12 MONTHS! Everything after only 1 year is PROFIT! Wouldn't that PLEASE INVESTORS IN YOUR FLAGGING MISMANAGED COMPANY! Wouldn't that keep THE TRAINED MONKEYS ON THE DIRECTORS BOARD EMPLOYED!

Half the cost, recoup is in 2 years, add in if only 1 in 80 people get it, full recoup is in 4 years. That is a good time frame for investment recoup, and that does not include more people joining it, and at a monthly fee of around £40-50.

Now, SNL had 22000 subs, so we are talking if double the people who subscribed to SNL decided to get broadband (something that would be very attractive to general home users, without doubt), they make all the money invested back in only 4 years, and at charging HALF of their proposed cost.

It is utter utter BULL**** what they are trying to charge. They can go to hell. And see if I care. One more year without broadband here and I am ****ing emigrating, I mean it.

Do the maths, they are trying to pull a very large and very fast one. You may be able to justify £1400 a year, you may be able to say you don't have a choice, there is no other option...

.....but in no way ever open your mouth and say the price is justified. It isn't. Look again at the numbers.

With the 3.8 million people, they need 1 in 38 people to get this installed.

Now ask yourself, do you feel lucky? Do feel like 1 in 38 people in this supposedly modern country would NOT want broadband?

Simple economics folks, there are not enough people over here for unlimited DSL for £20 (or whatever) a month. Its going to be a bit more expensive, and it will take time to evolve.

I don't think anyone expects this. The pricing, however, is way out of line with the rest of the EU and US. Not just by a marginal 30-50%, which we have come to expect in Ireland (e.g., 20% VAT + 30% VRT = 50% tax on cars.....), but by over 300%, and on top of that, a cap that makes the idea of broadband negligible.

Another point is that 3 gigs a month should be fine for the average home user, most home users if you think about it. Its more than enough. These companies dont want people who download mountains of warez/p0rn/divx's.

Would they have us go back to using ****ing acoustic couplers as well? I want to update my WIndows XP, oh ****, it's a 200MB download for SP1, so that's £5 please (2.6p/MB remember?). No thanks, I'll just get in on a CD, a month later.....like people did before the net, and still, Ireland is in the stone age. The rest ofthe civilised world moves by the minute, instant comms, broadband; Ireland is not part of this.

How about a game demo? They are 100-200MB+ these days.

Why don't we just all whip out the 600bps acoustic ****ing couplers and be done with it. Where's my goddamn C-64.............................

JANER · 19-09-2001 9:10pm

Bollovks.........
Eircom would get much more than the 30% if they reduced the price/cap
how the fvck can newbies be enticed by the piss take pricing?

SkepticOne · 19-09-2001 10:28pm

Originally posted by JANER
Bollovks.........
Eircom would get much more than the 30% if they reduced the price/cap
how the fvck can newbies be enticed by the piss take pricing?

Here's my views on the pricing:

1. Monopoly retention.

Regulations require Eircom to offer a wholesale product to other ISPs. If the wholesale price is low then ISPs may take up the offer and dilute the monopoly. So Eircom pitch it high. Because of the requirement not to sell at a loss, they must therefore pitch the retail price high so as to allow for a reasonable margin for their ISP arm. An Eircom spokesman mentioned this in a recent IT article.

2. Canabalisation of existing services.

Even if there were no ISPs but Eircom.net, the potential customers of ADSL might well be high-spending ISDN and 56K users. It is possible that if these migrate over to ADSL, there will be a net loss to Eircom on Internet access. This was mentioned a few months ago in The Economist magazine.

If Eircom get 10% with this they will be doing well, but I don't think they are expecting this amount. Nor are they expecting much net gain from ADSL.

So why are Eircom bothering with ADSL at all? Two reasons, I think. 1. Political: To avoid the criticism that Eircom are holding back the country. 2. Strategic: In the unlikely event that NTL or Chorus should present competition, Eircom can simply lower their prices and drive them off. The loss would be less this way than complete loss of the customers.

I think that most of our problems are a result of dominance by one company in the market. The solution will involve either encouraging competition through subsidy or vastly increased regulatory powers.

I'll sit down in my armchair now

R. Daneel Olivaw · 19-09-2001 10:53pm

Hmmmm. That gives me a thought:

How about the government pay for the £127 million they invested, and tell them to shut their collective mouths and charge reasonable amounts for it? Suddenly, Ireland has broadband, and at a good price.

Eircom don't have a fallback "boohoo we invested loads" position to charge high prices

Other providers can compete fairly.

The budget will have a £1.5 billion surplus this year, instead of the expected £2.5 billion before the tech meltdown started. That is a lot of money and I would rather it be spent on fair access and cheap access to broadband internet which every body could get no matter what the income (£30 a month is affordable, £93 isn't).

And that money would be better spent on that then reducing the income tax rates. The rates will reduce the next year surplus (if any), and will reduce future income all around. It will benefit some, but EVERYONE would be happy if at least we had reasonable broadband.

SkepticOne · 19-09-2001 10:58pm

Originally posted by R. Daneel Olivaw
Now, SNL had 22000 subs, so we are talking if double the people who subscribed to SNL decided to get broadband (something that would be very attractive to general home users, without doubt), they make all the money invested back in only 4 years, and at charging HALF of their proposed cost.

And of course ESAT stopped accepting new customers for SNL, the potential market was probably much higher.

SkepticOne · 19-09-2001 11:05pm

Originally posted by R. Daneel Olivaw
Hmmmm. That gives me a thought:

How about the government pay for the £127 million they invested, and tell them to shut their collective mouths and charge reasonable amounts for it? Suddenly, Ireland has broadband, and at a good price.

I would want to see this figure audited very carefully before any public money goes to these people. I wonder how much was already written off on previous aborted projects.

I would rather the money was spent on subsidising independently controlled ADSL equipment into Eircom's echanges using the LLU price that was fairly established by the ODTR. The ADSL service could be resold to ISPs (including Eircom.net so they can't say they are being treated unfairly) at cost..

R. Daneel Olivaw · 19-09-2001 11:41pm

Hmmm, yes. I remember someone said a few days ago that there was another DSL trial originally. I'm not too knowledgable on different DSL technologies (except for knowing what it is, or ATM, etc., ). The description was that the old trials from around 1999 (when the US was rolling it out for the whole country) had to be scrapped because they chose a redundant technology on their end, not to do with ADSL per se, but something else.

So they prob wasted loads on that. I'll say again that they are utterly stupid to be unable to provide basic communications services (yes, basic, as in: the rest of the EU and US have it), even with a total national monopoly.

I was hoping that there would be a broadband service available for Ireland by the end of 2001. It looks like there won't be. And that is after *quoted* over 100 million in investments.

The numbers, like I said above and in another post (being that £27/GB meant you would need to spend almost £300/month on ADSL downloads to get benefit over 56k. Isn't the whole idea to move away from the old pricing schemes? What, are the buying more bandwidth? NO THEY ARE NOT) do not add up, plainly and simply.

What I fear is that people are getting used to paying £200/month for phone bills, so Eircom reason that *that* income can continue in ADSL. DO NOT ACCEPT IT. DO NOT GET USED TO OVERCHARGING.

Broadband is to negate the attitude that bandwidth and internet connections are a finite resource, like water, coal, oil, whatever.

Once the infrastructure is in place, there are no more resource problems. If you build it, they will come. Once they have an ADSL network, the costs to them are negligible, but they have proven that they will constantly move to relatively INCREASE prices as the technology sector worldwide moves to provide MORE services for LESS.

Money Question

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