Friaco pricing.

Dangger

From Silicon Republic today

Speaking to siliconrepublic.com, spokesperson for Esat BT, Una McGirr said: “It’s been a long hard road to get to this point, but we’re very pleased. We feel that the news really pushes the game forward substantially and we’re optimistic and looking forward to our discussions with Eircom to get to the point we need to be, price-wise.

Earlier, spokesman for lobby group IrelandOffline, David Long said that it would be a ‘hollow victory’ for them if the monthly flat rate for unlimited access was more than €35 per month: “ I see no value in this if it’s not less than this,” he said.
McGirr concurred, saying that the ideal bracket for the retail end consumer service would have to be €25-€35. “Otherwise consumers won’t buy it,” she said.

McGirr added that Esat BT would begin meetings with Eircom this week to agree processes and terms and conditions. She continued that it would be Esat BT’s understanding that ComReg would see how these discussions go but that ultimately the regulator will set the prices.

Industry sources said that as a result of today’s ruling Eircom may have to cut its broadband pricing to deal with the introduction of flat-rate internet access (FRIACO): “It will be hard for Eircom to dodge this bullet. Short of taking legal action it will have to bend and do it,” said the source.

Broadband pricing will have to improve with the the introduction of friaco. The next few weeks are going to be interesting (how long have I been saying that for now! )

Interesting to see Esat's continued statements regarding the price they hope to release it for, and how fast the process is moving with meetings to be held this week apparently.

I'm sure we'll see/hear some statement from Eircom shortly, the silience has surely been to allow their legal team to get the electron microscope out.

LFCFan

if FRIACO becomes a reality at a price we like then €ircon will be forced to lower their ADSL prices as dialup and ISDN won't be as lucrative for them anymore.

scojones

can you say "progress"?

JohnK

sounds like good news all round then

MDR

good news,

but me thinks long term we will still be nashing our teeth until someone buys out Eircom and gives the company some new business sense.

BoneCollector

Yes!
as i said in a previous post...
once fraico is a reality it will force prices down in adsl, as well as the fact that

150 hrs at 56k is the same as adsl 3gig cap
the only difference is speed
and i for one will not pay 5 times the price to get 150 hrs worth of time faster!

De Rebel

Originally posted by sjones
can you say "progress"?

haha, can Eircom spell "progress"

BoneCollector

haha, can Eircom spell "progress"

G.A.M.E O.V.E.R.

Snaga

heh, whats the bets that €25 -> €35 will equal €34.99

Meh

Originally posted by Snaga
heh, whats the bets that €25 -> €35 will equal €34.99

I bet that'll be €34.99 ex VAT, too.

Tazz T

I can't see eircom letting it go retail for under €35 without a drawn out fight and whatever price esat/utv have to sell it for, eircom will still have the advantage of selling it lower because they will have set the wholesale price.

But if eircom sell for €30 and UTV have to sell for €35, I know where I'm going and it's not eircom. This is payback time. Even if it costs more :rolleyes:

Corko

I think that Eircom's rivals may sell internet at cost for market share in the telephony side of things.

Tazz T

That would be excellent. Like real competition in Irish telecommunications.:)

ando

Originally posted by MDR
gives the company some new business sense.

To be honest if I was philip nolan I'd be trying to keep the meetings dragged out as long as possable iswell. The long delays and the whole delay in flat rate introduction is perfect business sence to eircom

DC

That bit about FRIACO forcing down the price of Broadband sounds promising and makes sense to me. Hopefully I will only have to pay €270+VAT per quarter (with Esat) till the middle of the year. When FRIACO comes in, surely the price will have to drop to at most €180+VAT per quarter (for 512kbps ADSL). Otherwise a lot of people will be dropping BB in favour of the cheaper 56kbps (or maybe 64kbps ISDN).

crawler

Hmmmm....Couple of things here...

Firstly - the WHOLESALE cost of FRIACO is what we should be worried about. OLO's have to be able to offer the product and develop the systems to support it at a profit if it is to fly. If the wholesale cost is €30.00 per month then realistically you would be looking at a cost to the end user of at least €35+ per month.

Secondly - we should never compare FRIACO to broadband they are in no way or shape similar animals - FRIACO is a pricing model for Dial-up , nothing else.

What scares eircom is not just the cost of providing the service but the fact that tying up the phone line for long periods fo time reduces the possible income they will make on phone charges , in particular during the Business day.

While all developments on FRIACO are extremely welcome FRIACO at a price in excess of €35 is not good - ntl offer 512k BB for the same price , actually €30.00 if you take DTV , even though this is a tiny tiny part of Dublin.

The best posible thing about FRIACO is that is will encourage people to migrate to BB......one will force the price of the other but not at any cost.

Does anyone agree with this or am I talking brown stuff?

ozt9vdujny3srf

does FRIACO include peak times?

Will it be possible for me to leave my connection running 24/7

LFCFan

Originally posted by TruckledUncivil
does FRIACO include peak times?

Will it be possible for me to leave my connection running 24/7

That's the whole idea of FRIACO. 24/7 Internet access for a set monthly fee.

BoneCollector

What scares eircom is not just the cost of providing the service but the fact that tying up the phone line for long periods fo time reduces the possible income they will make on phone charges , in particular during the Business day.

This is what there scared of but in reality it wont happen.
1stly a good population of the island work during the day so for them it will still be an off peak service.

2nd any one that uses it during the day will probably still limited to the 150 hrs allocation which is reasonable for 24hr access.

and sure what are the possibility that everyone will be on the internet all at the same time, especialy during business hours. You could always implement a timeout limit of 5 mins or something..
that is to say if your not downloading you are cut off in 5 mins, cus your either away from the pc or your reading an article or a page. this also increases the amount of time you have and can get use out of your 150hrs for doing real work like downloading pages websites or data.
there are plenty of ways to give users what they want and still not tie up the network.
But it will be a god send for the likes of the unemployed if they can afford it, cus its more likely they will gain employment through email than post or any other form of communication these days.

scojones

Knowing our luck we'll get it for €45. And something like what happend with nolimits will happen. The service will be too hard to connect to (busy dialtone constantly). And when we do connect it will be at a slow rate. And they'll disconnect us every hour!@# Sorry for my mood but i have the flu

De Rebel

Originally posted by crawler
Does anyone agree with this or am I talking brown stuff?

By and large I would agree, Fraico and Broadband are 2 different things. However, the point DC makes is valid:

If flat rate were available at say Eur30 and if it was enabled on 64k ISDN, and if the alternative was Broadband DSL at current Eircom prices, then I would probably stick with 64K ISDN FRAICO, for 2 reasons
(1) I'd like to keep my ISDN for other purposes, and having an extra line just for DSL wouldn't work at those prices.
(2) While DSL should give much better performance, for most of my requirements, 64K would be adequate. And if the occasional 500Mb download has to run for 24 hours, so what.

One of two things will happen: either they will manage to get a high wholesale price for FRAICO, which will enable them to maintain the rest of the current price model. Or the wholesale price will be in the Eur18-28 region which will have a knock on effect on the DSL prices.

Three questions -

1. Have we any reason, based in fact, to believe that FRAICO will apply to 64K ISDN, as well as 56K ? I asked this elsewhere and didn't get any answer.
2. If yes to Q1, how will 128K ISDN be priced?
3. What is the norm internationally regarding extent of FRAICO - 56K, 64K, 128K?

Dangger

The whole idea of true flat rate is that there is no such thing as on peak and off peak any more. Over use and abuse (such as just leaving a computer conected all day on dial up) will have to be handled by the terms and conditions of the product determined by the Internet Service Provider.

So flat rate does away with metered (per minute) billing which was desiged for voice calls. Eircom on the other hand noting that Internet calls last longer than most voice calls have fought to keep metered billing in to screw the user.

Flat rate or unmetered billing is what the Internet is all about (for the rest of the world ), IP is all about connectionless orientated networks and PSTN is all about connection orientated networks. Different ideas, different billing, we've been forced to wear the metered hat.

STaN

just bundel 10 isdn lines and your flying

crawler

LFCFan....You can run 24/7 if you use the correct keep-alives to the network.....they will impose caps though.....to stop people doing this.

LFCFan

Originally posted by crawler
LFCFan....You can run 24/7 if you use the correct keep-alives to the network.....they will impose caps though.....to stop people doing this.

Not being rude or anything but why are you telling me this? Did I imply somewhere that you can't stay connected 24/7? The auld memory's taking the piss these days!

Serbian

Many concerns have been expressed over the price of FRIACO. The following sentence appeared in the article:

She [Una McGirr, spokesperson for ESAT] continued that it would be Esat BT’s understanding that ComReg would see how these discussions go but that ultimately the regulator will set the prices.

So it's down to ComReg to set the wholesale price and not Eircom. Assuming ComReg had some input on the price of Eircom's ADSL wholesale rate (roughly €40?), we are surely guaranteed a price lower than that. I personally recon we will see FRIACO at about €30 at retail level.

As for affecting the price of ADSL, I wouldn't be so sure that Eircom will be forced to lower the price of ADSL, as they have always marketed it as a business product and never as a home product. I can see them pushing this as the thing to have if you are a home user.

Hopefully I am completely wrong though

Dangger

Serbian is of course right. I noticed that very point earlier and put it up in a note here on the IrelandOffline site.

Yes it appears that ComReg will be setting the price. But I'm sure that it will be based on the costings provided by Eircom, on their "Roll's Royce" network.

Costings provided provided by Eircom have always been questionable. But correct me if I am wrong here someone please, is the LRIC model an attempt to validate the *actual* costs?

PiE

If Comreg and the DCMNR are serious about getting Ireland up there with the rest of Europe, they should be considering the lowest possible wholesale price for FRIACO, lower than the rest of Europe. It's the only way we're ever going to catch up.

Esat said "ComReg would see how these discussions go but that ultimately the regulator will set the prices", so they're obviously expecting that Eircom won't offer a fair wholesale price.

Can't ComReg force a new wholesale DSL price on Eircom too?

Tellox

This can be very good news.
If we get a flat rate product early march,it could be €30 a month, and that would force DSL caps to go up (from say 4gb to 10gb/nothing), and prices to go down... If its €40 a month with a 2hr dc, then not too many would take interest, and it wouldnt lower DSL prices and higher the caps as much as the first product would...

either way,it is good news

BuffyBot

Originally posted by TruckledUncivil
does FRIACO include peak times?

Will it be possible for me to leave my connection running 24/7

Not nessecarily. The ISP's (like many in the UK) may impose cut-off's where it you have to disconnect and re-connect. This is to stop people from clogging up the networks in this manner.

BoneCollector

I personally recon we will see FRIACO at about €30 at retail level.

Look at it this way..
the only difference between the current offering and Friaco is that you can dialup any time of day or night for the same monthly fee and its not just off peak.

So realisticaly it should be no more costly that the current offerings because the only difference is you have access to the same benifits peak times as well as off peak.

the off peak packages are simply restrictive! on errcoms part.
and unless the people in comreg are not savy they should also be aware that a price of €30 or less retail inc VAT is! the golden price point.

Fergus

The big step forward with FRIACO is that eircom lose the ability to time-charge use of their network.

Your ISP buys a fixed amount of circuit capacity, the ability to cope with X calls at once, for a fixed fee from eircom. And thats all eircom has to do with it. Peak or Off-Peak doesn't come into it, because the lines are assigned wholly to the ISP at all times.

At present, all calls, Internet and voice alike, share the one eircom network, and eircom can argue that they need to charge more in business hours to avoid over-use.

With FRIACO, too many calls to the ISP just causes the ISP's pre-purchased quantity of FRIACO lines to jam up.. it doesn't overflow into the rest of eircom's network, so eircom have no basis to impose their own usage-related pricing structure.

Basically, the ISP not eircom now has the freedom to decide the balance of price vs quality of service they want to sell at.

zynaps

Originally posted by Dangger Over use and abuse (such as just leaving a computer conected all day on dial up)[/B]

Err, how is that overuse or abuse?
That's the whole point of flatrate...

Would it also be overuse or abuse to leave your dsl/cable/wireless connection online all the time?
Because I believe that's how it tends to work.

If friaco comes out, and I have no feasible broadband options available, I'll probably get a second phone line/ISDN line and leave the PC on all the time on whatever flat rate package works well.

Also, someone mentioned earlier that the majority of people would tend to use the net in the evening anyway, as they're in work.
Perhaps this way they can have internet access in work, without having to pay multiples of hundreds per month for satellite or leased lines or something.

Why go sparingly on it? It's not gold or something...

zynaps

SkepticOne

Originally posted by zynaps
Err, how is that overuse or abuse?
That's the whole point of flatrate...

Would it also be overuse or abuse to leave your dsl/cable/wireless connection online all the time?
Because I believe that's how it tends to work.

Main difference between broadband (dsl/cable/wireless etc) and PSTN (56k and ISDN) is that PSTN uses up resources even when it is not transferring data. Flat-rate 56k and ISDN will emerge from FRIACO provided the wholesale price is low enough and the ISP market is competitive enough, but it will never be "always on". ISPs will always have ways of discouraging heavy use. They will still have to pay for the capacity that allows you to stay on.

zynaps

How does PSTN use more resources than other systems? Is it actually expensive for them to have someone online?
(I'm asking, not challenging what you said) :P

SkepticOne

Originally posted by zynaps
How does PSTN use more resources than other systems? Is it actually expensive for them to have someone online?
(I'm asking, not challenging what you said) :P

It is because a dedicated 64k channel from the ISP's modem to your modem needs to be kept open regardless of whether or not traffic is being transferred over it. The ISP, through FRIACO, will be buying a fixed block of such capacity from Eircom. In order to serve as many people as possible, they will want moderate use from as many people as possible. Extreme users will take up more of this fixed capacity and measures will be taken to curb such use if necessary.

Here's a simple analogy. You are sharing a house with friends. In order to save money, it is decided to by, say, breakfast cereal in bulk. Each person in the house pays a few quid a month and a big bag of cerial is bought and made available.

So long as the people in the house each eat roughly one bowl a day, everything is fine and there is no need to 'meter' the cereal consumption. (in a commercial environment there would be costs associated with such metering and billing).

Should someone arrive, however, and eat significantly more than others, then the whole thing breaks down, and the tennants then need to keep track of how much everyone is using.

Therefore flat-rate internet via FRIACO depends on everyone being considerate to others in the use of limited resources.

Another analogy is the all-you-can-eat buffet. To stay open, the buffet needs to attract as many non-gluttens as possible. If they only people going to such establishments are people who eat eight plates worth, the establishment would quickly shut down.

Fergus

Note that flat-rate ISPs in the UK and elsewhere actually have a ratio of several users to each FRIACO line they possess.

If you look at the wholesale price for FRIACO circuits you will probably find that is it higher than the monthly customer retail flat-rate service. AFAIK, in the UK a basic FRIACO port wholesale costs the ISP about STG27 per month (more for tandem), but of course the retail offerings are more like STG14/month.

This is because the ISP operates on the basis of only 10% or 20% of users being online at any one time, so for example if they have 1000 users they only actually rent 200 FRIACO lines.

This is why flat-rate dial-up never actually means always-on. The point is you can dial up anytime and stay on as long as resources allow, and for a fixed monthly fee. If the ISP did find they had a lot of users who were doing keep-alives etc to keep the circuit open all the time, they would have to do something about it.

De Rebel

Originally posted by Fergus
........ per month (more for tandem), but of .......

Fergus,

There is a lot of coverage of "Single Tandem FRAICO" in the ComREG Directive, especially the fact that it will not be provided at this point.

Could you explain in 2 or 3 paragraphs or point me to an explenation of the advantages of "Single Tandem FRAICO", the implications for users given its non availibility here and the potential cost considerations.

Sorry if I am the only one on the palnet that does not understand the issue, but ComREG appears to make a big deal about it, without actually explaning the issues.

Thanks

apologies if this is OT, but it seemed appropriate to follow on from the previous post

Fergus

Well, I'm no specialist and I apologise to telecom engineers if I'm making a blithering idiot of myself, but anyway..

In a simple sense, everyone's phone line is hooked into a local telephone exchange. These are primary exchanges. I think there are around 47 of them in Ireland. There may be smaller remote exchanges and so on, but everyone essentially has their own primary.

Then there are tandem exchanges. These are exchanges that connect the primary exchanges together. I think there are around 13 tandems, and they are heavily interconnected. They are sort of the 'core' of the voice phone system.

Every local primary exchange is connected to the tandem network.
If you make a call to someone who is not connected to the same primary exchange as you, the call goes via the tandem exchanges out to the other primary exchange you are trying to reach.

Now, this is important in regard to FRIACO. The current FRIACO product being proposed only allows ISPs to connect to their user's calls via the primary exchanges. The calls are not allowed to use the tandem network. This means that if you make your FRIACO call to your favorite ISP, they must have their office hooked in directly at your primary exchange, otherwise you can't reach em. With this type of FRIACO, an ISP that wants national coverage needs to have their own links directly into each of the 47 primary exchanges. As they are picking up their calls from the eircom network at the exchange where they originate, so eircom don't have to worry about the call needing to be routing through their precious core tandem network.

If the ISP can't reach every exchange, they can pay eircom extra for carrier services.. sort of like hiring leased lines or dedicated capacity through eircoms network, which would allow them to bring connections from the primary exchanges they can't reach directly right back to their offices. However, this obviously adds a lot to their running costs.

This was the original type of FRIACO available in the UK. However, pressure from ISPs led OfTel to get BT to introduce Single Tandem FRIACO. This means the ISP only has to hook in at one of the Tandem exchanges in the core network, and from there they can pick up calls from any primary exchange. This is obviously a lot simpler for the ISP. The cost of these type of FRIACO circuits though is higher, because obviously more resources within the telephone network are being allocated for each call.

The low number of primary exchanges in Ireland compared to UK (they have something like 800+ I think) may make things simpler here. I don't know if UTV/Esat have interconnect capability already in place at all the primaries. So it's hard to know what impact lack of Tandem FRIACO will have.

De Rebel

Originally posted by Fergus
Well, I'm no specialist and I apologise to telecom engineers if I'm making a blithering idiot of myself, but anyway..

Fergus

That explains it very well thanks, and the wording of the directive now makes a lot more sense. It looks like this must have been the key sticking point which caused the breakdown of the pre Christmas discussions.

There is an appendix of exchanges in the Directive, it looks like there are 16 Tandem and 48 primary. Therefore by forcing the OLOs to connect to the primary exchanges they need three times the number of connections, or else pay eircom to carry the transit traffic on the core. No wonder Eircom banned them from the Tandem Exchanges to "protect the integrity of the core network"

Do I smell a rat or what..........

pork99

The current FRIACO product being proposed only allows ISPs to connect to their user's calls via the primary exchanges.

Are they going to be allowed to get away with this sh1t?

Fergus

The same arguments were made by BT in the UK, but OfTel got an independent panel of experts to look into the situation. IIRC, they essentially concluded that while there were issues with tandem overload, it was quite possible for BT and the ISPs to plan around it in advance and invest what was required.. on the basis that FRIACO demand would never get too out of control as users (and the voice service itself) would be switching to real IP / broadband networks in the short to medium term anyway.

That was over two years ago and I don't recall the British telephone system since coming crashing down due to epidemics of linux distro downloading

The report from OfTel on tandem capacity etc is
here.

"BT Internet customers have enjoyed unmetered surfing since February [2000], and we have no intention of taking that away. In each case, people are paying a fair price for a good unmetered deal." "unmetered Internet access is entirely possible if you have a business model based in the real world."

British Telecom August 2000

Fergus

Originally posted by pork99
Are they going to be allowed to get away with this sh1t?

It's not that bad. The critical point is to get any kind of FRIACO introduced as this will mean for the first time, eircom have to sell wholesale fixed circuit *capacity* as opposed to charging for *time*. This is a huge step forward.

There is a much clearer relationship to true running cost when you are talking about providing a pre-agreed fixed capacity within a single exchange (FRIACO), as opposed to the crazy situation to date where eircom come up with this vague per-minute charge based on all sorts of possible costs throughout their network. I hope this will mean it's not so easy for eircom to try on their usual crazy wholesale over-pricing.

BoneCollector

as opposed to the crazy situation to date where eircom come up with this vague per-minute charge based on all sorts of possible costs throughout their network

I think this is whats known as the errcom Random Number Generator
Which is soon to lose it Mystical Powers over the internet user

Richard Barry

It seems to me that eircom have managed to pull the wool over ComReg’s eyes.

To quote from ComReg0302:

“In reviewing the draft product description containing the OLO requirements, some serious technical difficulties surrounding the implementation of Single Tandem FRIACO were identified. These difficulties could potentially adversely affect the integrity of the eircom network to the detriment of other users. eircom proposed an alternative, but this proposed solution was not economically efficient”.

Good old FUD (fear, uncertainty and doubt). It served IBM for decades and kept their profits sky high.

If 1,000 ISP customers move from 1891 access to 1893 flat rate, the same tandem capacity that hitherto served the 1891 traffic will surely be automatically redeployed to handle the 1893 traffic. The only problem that has to be managed is people staying online longer under 1893 than when they were on a pay as you go basis. This will generally arise during peak hours (because there should be spare transit capacity in the network outside the 09-17h Mon-Fri timeframe).

A problem of this nature can surely be managed as it arises by putting a temporary local ceiling on the number of tandem channels used by 1893 dial-up in exceptional circumstances where insufficient capacity exists in the network fabric. At the same time the ISPs in question and eircom need to bang heads together to sort the problem out (in terms of adding capacity or whatever).

In any event, it still escapes me why the parties are bothering with the FRIACO route at all. The telecommunications industry worldwide is going IP – which means DSL. It provides a better quality solution for the end user and does not tie up switching equipment. The way FRIACO is progressing in Ireland, it will be just as geographically onerous for an ISP to provide coverage on an unmeasured dial-up basis as it is to roll out DSL.

ComReg would surely be better off mandating more favourable tariffs for wholesale bitstream – based on a range of DSL speed options and flavours (say from 128k upwards). The current wholesale tariff in Ireland (which only covers the segment between the local eircom POP and the customers’ premises) is more expensive than the end to end retail tariff (which includes the ISP feed) in most other countries. Something radically wrong somewhere with the costings?!

Finally, ComReg 0302 doesn’t mention the word “ISP” once. Presumably a reflection of a vision of keeping the Irish ISP business a nice closed shop for OLOs (ie licensed telcos).

R

PS
BT charge GBP 507 per annum per single tandem FRIACO port – which is effectively an ISDN channel in terms of capacity. An ISP with 100 ports (channels) could serve between 500 and 800 customers. Based on 800 sharing 100 ch., the cost to the ISP per customer per month in real money would be about EUR 8 (for the single tandem FRIACO connection).

Fergus

I agree that the Eircom argument against Tandem capacity is FUD. Remember, they've managed it in the UK with a network many times more complex.

A direct move to IP would be better, but I think it assumes eircom would act outside of self-interest. Their bitstream price is forced into place in part by a lot of legal pressure on the regulator, not reality.

FRIACO critically is required to break the costing structure that sustains their per-minute / per-megabyte monopolistic profits on the existing PSTN. One of the main reasons I think the i-Stream product is so expensive is because they are attempting to maintain an equivalent cost per downloaded MB to that of dial-up, so as not to risk any impact on their excessive usage revenue.

The other thing about FRIACO (particularly ST Friaco) is that it creates a chance for competitors to enter the market, because it means far less network build investment for them to get started.

I guess essentially when new telecoms technology delivers 10 times the performance for the same or less money than before, eircom always try to charge 10 times as much anyway. It's just one long-running con trick and its time is up.

SkepticOne

Originally posted by Richard Barry
In any event, it still escapes me why the parties are bothering with the FRIACO route at all. The telecommunications industry worldwide is going IP – which means DSL. It provides a better quality solution for the end user and does not tie up switching equipment. The way FRIACO is progressing in Ireland, it will be just as geographically onerous for an ISP to provide coverage on an unmeasured dial-up basis as it is to roll out DSL.

ComReg would surely be better off mandating more favourable tariffs for wholesale bitstream – based on a range of DSL speed options and flavours (say from 128k upwards). The current wholesale tariff in Ireland (which only covers the segment between the local eircom POP and the customers’ premises) is more expensive than the end to end retail tariff (which includes the ISP feed) in most other countries. Something radically wrong somewhere with the costings?!

FRIACO (and the flat-rate products based on FRIACO) and DSL compliment each other, in my view. One of the characteristics of the Irish market is a generally very low internet use as pointed out by Eircomtribunal. Whilst some telcos may say that this is due to "lack of compelling content" or some other rubbish, it is clear to most of us that it is the high cost of staying online for even reasonable amounts of time. This is despite the quite high ownership of computers with internet connections in Ireland. We must therefore grow the number of active internet users in Ireland and this is best done initially with narrowband flat-rate services as most people own computers with built-in modems.

One of the things that telcos bang on about (one telco in particular) is the lack of demand for broadband and how the tax-payer needs to stimulate it with subsidies. I don't agree with this, but assuming for the sake of argument that it is the case, then, flat-rate narrowband will stimulate this demand in the long run simply by educating people to the possibilities of the internet. The internet itself is the best teacher of the uses of the internet. Demand will therefore be increased for DSL and the lack of demand argument will be removed from the telco's repetoire of excuses.

To compliment FRIACO, there needs to be an alternative for the more experienced users to move over to. DSL will fill this need once the price comes down to realistic levels. There is no reason that work can't begin on this now.

Richard Barry

Originally posted by Fergus
I agree that the Eircom argument against Tandem capacity is FUD. Remember, they've managed it in the UK with a network many times more complex.

A direct move to IP would be better, but I think it assumes eircom would act outside of self-interest. Their bitstream price is forced into place in part by a lot of legal pressure on the regulator, not reality.

FRIACO critically is required to break the costing structure that sustains their per-minute / per-megabyte monopolistic profits on the existing PSTN. One of the main reasons I think the i-Stream product is so expensive is because they are attempting to maintain an equivalent cost per downloaded MB to that of dial-up, so as not to risk any impact on their excessive usage revenue.

The other thing about FRIACO (particularly ST Friaco) is that it creates a chance for competitors to enter the market, because it means far less network build investment for them to get started.

I guess essentially when new telecoms technology delivers 10 times the performance for the same or less money than before, eircom always try to charge 10 times as much anyway. It's just one long-running con trick and its time is up.

>>>A direct move to IP would be better, but I think it assumes eircom would act outside of self-interest. Their bitstream price is forced into place in part by a lot of legal pressure on the regulator, not reality.

Quite. But two issues still remain:

1) The new authority (ComReg) needs to revisit wholesale bitstream pricing and justify to the public why Irish wholesale prices for 35% of the broadband product exceed typical European retail pricing for 100% of the product.

2) Scale down the wholesale bitstream speed to FRIACO type levels (eg 128k – 2 channel isdn) and scale down the cost pro rata.

It should deliver an IP platform that provides far better value to the consumer, has a longer shelf life for the ISP and has no network congestion implications for eircom – FUD or otherwise.

>>>The other thing about FRIACO (particularly ST Friaco) is that it creates a chance for competitors to enter the market, because it means far less network build investment for them to get started.

It would be nice to think that was the case. However if you or I decided to go into the internet business tonight, under the current FRIACO proposals, where would the cost savings lie? (compared with promoting a DSL platform as the minimum entry point) and ignoring the fact that we haven’t a clue about costs because despite years of timewasting “negotiations” and regulatory whatevers eircom have managed to keep the crunch issue of cost out of the picture even at this late stage?:

1) We would have to buy or create IP transportation capacity into every eircom switching entity in the country to offer nationwide FRIACO. We’d have to do much the same to offer a DSL based service. A non trivial, competition-eliminating proposition whichever way you look at it. You might say lets concentrate on area X for starters – but this makes marketing difficult. You run an advert on virtually any medium and you will get lots of punters who are out of your coverage area who will cost you money to say no to and who themselves might feel pissed off at your inability to deliver.

2) Where is FRAICO cheaper than DSL under the current proposals? The cost of the modem basically. Not that a DSL modem is more expensive than a 56k dial-up unit but the customer has to upgrade his modem to a DSL box and a dedicated “modem” (ie the card in the DSLAM) is required at the service provider’s end. But surely these one off costs are trivial compared with what people are over paying month in month out (EUR 40 – 500+) for an appallingly slow, second rate, analog dial-up product that delivers about 20% of the potential value of the internet? And if you have only one PSTN line, everyone else in the house is offline (voice or internet) while you are surfing in non-DSL mode.

If you don’t find it economic to pay the DSL modem costs in your usage circumstances you are almost certainly better off on balance staying with a pay as you go dial-up option. I’m not trying to force DSL down everybody’s throat. I do feel that few people have thought through the FRAICO logic except for eircom. And we know the bias that their thought patterns have followed. DELAY being #1. A welcome sideshow to take the spotlight off DSL. And as I stated in my previous posting, NO ISP NEED APPLY. ComReg appear to have locked them out.

>>>I guess essentially when new telecoms technology delivers 10 times the performance for the same or less money than before, eircom always try to charge 10 times as much anyway. It's just one long-running con trick and its time is up.
How much would the 2,6 Ghz Intel Pentium processor cost today if its cost was based on the speed, power and price of the original 8086/88?

Neither ComReg nor eircom would appear to have heard of Moore’s law!

R.

De Rebel

Fergus and Richard thanks for a most enlightening sharing of information.

This sounds like trouble. Re-reading COMREG0302, the second page of Section 1(Background) makes worrisome reading….. There are four paragraphs on the second page: I am inserting my conclusions – have I got it correct?

In reviewing the draft product description containing the OLO requirements, some serious technical difficulties surrounding the implementation of Single Tandem FRIACO were identified. These difficulties could potentially adversely affect the integrity of the eircom network to the detriment of other users. eircom proposed an alternative, but this proposed solution was not economically efficient.

Sounds like ComREG are accepting an argument which OFTEL have dismissed. Round 1 to Eircom

The restrictions required to ensure network integrity in the proposed product description for the implementation of Single Tandem FRIACO would have led to a product offering which would have prohibited new entrants from availing of the service. The necessary commercial constraints which the product description would have imposed would have made the product non-commercially viable.

ComREG recognises the implications of loosing Round 1, but is unable to do tackle the issue head on (Does that sound familiar) Round 2 to Eircom

In light of the of the above technical and commercial constraints surrounding the Single Tandem proposed product description ComReg believes that it is more practical and expedient and in the interests of users, to intervene in the negotiations and introduce FRIACO on a phased basis, by freezing the product description for phase 1(Primary level FRIACO) in the form set out in Annex 1 of this Decision Notice. ComReg considers that the product description in Annex 1 will allow operators connected at Tandem level to offer an equivalent service to those connected at primary level by utilising Interconnect Extension Circuits. ComReg will also continue to work with the industry in seeking to introduce a commercial and technically viable product offering for Single Tandem FRIACO.

The parts in italics (my emphasis) is the Irish/ComREG solution to the Irish problem. A competitor, be it OLO or new entrant ISP, will have three options (1) offer a limited service restricted to a few of the 48 primary exchanges loosing economies of scale and making marketing and product identification a nightmare (2) Connect to every one of the 48 Primary Exchange – more money for Eircom, and a major obstacle for new entrants (3) Connect to a Tandem Exchange and use ICE to transit the core network as set out in Appendix 1 of COMREG0302; presumably paying Eircom mucho zillions for the privilege. In other words a convoluted mess, enabling the incumbent to disincentivise new entrants and monopolise the core network to strip the OLOs of the advantages which Competition and Market Liberalisation were to confer on them. Round 3 to Eircom

ComReg, recognising the benefits that will arise from the delivering of a FRIACO product to the marketplace in a timely fashion and for the clarity of all parties, sets out the complete process, with dates, for the development of inter-operator processes, terms and conditions and cost orientated pricing associated with the product description in Annex 1 of this Decision Notice.

Here comes another half assed, half baked, over priced product; it’s the best we an do for ye, jeeze we’d love to do better, but sure wouldn't half a loaf better than no bread,
I won’t declare Round 4 until I hear what the wholesale price is set at…...

Originally posted by Richard Barry
BT charge GBP 507 per annum per single tandem FRIACO port – which is effectively an ISDN channel in terms of capacity. An ISP with 100 ports (channels) could serve between 500 and 800 customers. Based on 800 sharing 100 ch., the cost to the ISP per customer per month in real money would be about EUR 8 (for the single tandem FRIACO connection).

That’s superb information Richard. Are those ratios (100 ports:500/800 customers) the norm in the UK? Have you any more of this price/ratio information in relation to other countries?

Regarding the point that we would all be better employed focusing on DSL rather than analogue based solutions: there really is no argument. Its pathetic that in this country we are getting our little hearts into a flap over FRAICO in 2003. But the wholesale Bitstream pricing has eliminated any likelihood of competition/realistic pricing for DSL. What’s ominous, if my reading of the ComREG document is anywhere near the truth, is that wholesale FRAICO could be going exactly the same way.

Sorry if I sound critical and/or cynical and while I do acknowledge and commend the efforts of the Minister and ComREG, this does not sound too promising.

What chances of wholesale FRAICO being charged at Eur 8 per customer here…………

zynaps

A bit OT, but if it is inefficient to have FRIACO going through the whole network of exchanges if necessary, would it be possible for an OLO with dslams in the exchanges to somehow stick multiple dialup connections into a dsl, and thus remove the pstn traffic?
Since their dsl ports may have enough bandwidth to carry many dialup lines, there would only be traffic from the user to their own exchange if they could have some conversion thing where 20 dialup lines are served by one 1024k port, or whatever...

Yes, I don't know what I'm talking about, but it seemed like a good idea at the time....

zynaps

Fergus

When FRIACO was originally introduced in the UK it was on the same primary exchange only basis as being proposed here. The regulator recognised this was a problem and tandem interconnect was going to be needed. At the start of 2001, tandem FRIACO was introduced. 'Stage 1' was to allow tandem FRIACO, with a view to moving traffic off it onto an IP network in 'Stage 2'. Here are some points made at the time (DMSU = a type of tandem):

28. During the Director’s consideration of Worldcom’s request, BT submitted that the expected substantial increase in traffic, which would result from unmetered interconnection for Internet purposes, would exceed the capacity of the Public Switched Telephone Network ("PSTN") as currently configured. In particular, the DMSU switches would not be able to handle the expected increase in traffic;

29. In view of BT’s arguments the Director sought independent technical expert advice on the options available for investment to enable unmetered interconnection at the tandem layer, that is, the layer of the PSTN which carries trunk traffic which is switched by a Tandem Switch;

32. Having considered the independent technical experts’ and consultants’ advice, as well as the further submissions from BT and other operators, the Director is now in a position to amend his Direction of 26 May 2000 to provide for interconnection at the Tandem Switch;

44. Stage 1 lasts until 31 January 2003 by which date BT could reasonably be expected to have expanded its network to deal with the expected increase in Internet Traffic. During Stage 1 BT shall be obliged to provide FRIACO switched through any of BT’s Tandem Switches, to a Point of Connection situated at that Tandem Switch, that is single tandem FRIACO;

45. The Director considers that in Stage 1 if Internet Traffic continues to grow as estimated there could be a shortage of capacity at one or more Tandem Switches and that management of such capacity is therefore required;

46. Such management can be achieved by reasonably rearranging the traffic of those operators requesting or being supplied with single tandem FRIACO, pursuant to this Direction. This will create additional capacity at the Tandem Switch. Such rearrangements are also necessary to ensure that network integrity is maintained;

47. In order to encourage operators to complete the required rearrangements set out in this Direction it is reasonable and appropriate to provide for the ability of BT to cease its provision of single tandem FRIACO to operators which fail to complete the required rearrangements;

53. However, due to the limitation of capacity at BT’s Tandem Switches, the Director considers it reasonable to place a maximum limit on the number of ports per operator per Tandem Switch, in order to reduce the likelihood that any one operator is able to obtain all the available single tandem FRIACO ports at the more popular Tandem Switches. This limit may be revised by the Director;

The full directive is available here.