ComReg is pleased to welcome eircom's revised FRIACO product pricing

Politics.ie

ComReg is pleased to welcome eircom’s revised FRIACO product pricing
submission. After review and analysis ComReg finds the proposed:
PFRIACO un-metered traffic charge of € 14,728 per 2Mb/s
to be adequately cost justified. ComReg is also pleased to accept eircom’s
proposal that these rates be reviewed at 6 monthly intervals from the date of
In the light of the rapid review date and the importance of price stability and
predictability for this new product in a volatile market, ComReg have decided
that these charges should be final and that retrospection should not apply.

So what does this mean exactly?

longword

[EDIT]Great big giant invalid assumption ahead[/EDIT]

Well, we don't know exactly what that €14,728 buys the ISP, but it looks like the price for a single dialup user with a 48k average connection, transferring data 24/7, will cost just shy of €350 per month ex VAT. Should be possible to budget for say a 30:1 contention ratio and hope for the best, comes to about €11.50. Guesstimate as much again for service provision, add your 21% VAT, and it should be possible to do a product for €30 so long as you can control the users such that the contention ratio doesn't bit too hard.

A better guess would need way more information and a careful examination of the small print. Does that cost cover modem banks for example?

Boston

Originally posted by longword
Well, we don't know exactly what that €14,728 buys the ISP, but it looks like the price for a single dialup user with a 48k average connection, transferring data 24/7, will cost just shy of €350 per month ex VAT. Should be possible to budget for say a 30:1 contention ratio and hope for the best, comes to about €11.50. Guesstimate as much again for service provision, add your 21% VAT, and it should be possible to do a product for €30 so long as you can control the users such that the contention ratio doesn't bit too hard.

A better guess would need way more information and a careful examination of the small print. Does that cost cover modem banks for example?

first off i dear say that a yearly price or at worst 6 month price. Second, there is no contention ratios on dial up internet access. you get 48k and thats it (im nearly positive on this.) So your looking at a price of around 30 euro wholesale, and around 42 euro with vat and a profit margin.

Dangger

See here for a table of pricing for 2mb friaco circuits relating to BT's network. Remember these prices are in sterling. Perhaps someone could do a conversion?

Description Effective Date Until Charge per month
FRIACO Virtual Path Charge per 2Mb 01/06/2000 14/02/2001 £1060.63
FRIACO Virtual Path Charge per 2Mb 15/02/2001 30/09/2001 £854.80
FRIACO Virtual Path Charge per 2Mb 01/10/2001 31/03/2002 £832.60
FRIACO Virtual Path Charge per 2Mb 01/04/2002 17/07/2002 £786.18
FRIACO Virtual Path Charge per 2Mb 18/07/2002 31/03/2003 £719.62
FRIACO Virtual Path Charge per 2Mb 01/04/2003 £673.02

Have not got time to scrutinise these prices in the extreme right now but this document is a good starting point for having the eircom price compared to.

MagicBusDriver

Just guessing, but there is 30 64k channels in 2mb, so 14,728/30/12 = 40.91 per port. If these ports were contented 10:1 it would give a wholesale price of €4.09.

SkepticOne

Originally posted by Dangger
See here for a table of pricing for 2mb friaco circuits relating to BT's network. Remember these prices are in sterling. Perhaps someone could do a conversion?

That figure translates to GBP 10,038.9772, so it compares to the rate at which FRIACO came out at in Britain in 2000. It will need a lot of further analysis.

jd

Originally posted by Boston
first off i dear say that a yearly price or at worst 6 month price. Second, there is no contention ratios on dial up internet access. you get 48k and thats it (im nearly positive on this.) So your looking at a price of around 30 euro wholesale, and around 42 euro with vat and a profit margin.

You wouldn't budget on every user staying on 24X7 so thats where the contention ratio comes in, I imagine.

longword

Wow, that's per year? Sweet! I assumed it was per month. There has to be small print though. Like the €300/€272 to turn a regular dialup port into a FRIACO port. From that, I would have to guess every single dialup user constitutes a full 64kbps regardless of whether or not they're doing anything at any given time - so no contention at that level, not counting users that are offline, and telecos still run the modem banks (these days a 'modem bank' is typically a set of boxes that each take an straight-up E1 2Mbit circuit anyway).

Boston

Originally posted by jd
You wouldn't budget on every user staying on 24X7 so thats where the contention ratio comes in, I imagine.

then thats not connection ratio as i would call it, ever wonder why somethimes you connect to the web and then just nothing, no data coming or going, thats because they have to many people connecting and to few ports. in the conventional sense of a contention ratio(like with adsl) if more people connected you speed just went down. Of course they could allwasy to an esat effort and instead of giving people a decent service give everyone a **** service and pack more it. Again this is not connection ratio, in fact i dont know what its called. I just know when your talking about contention ratios yourbeing very specify to something that doesnt apply to dial up.

Yes isp's operate ratios, but i'd be very slow to call them connection ratios. I think the average is one port to every 50 users for those free dial up services. the effects are quite different to broadband


I can remember long talks with various people in the industry where they where trying to explain this principal to me, and why friaco was so expensive to run.

now according to dangger these are monthly prices whic i fail to see how anyone could make money off.

SkepticOne

Originally posted by Boston
then thats not connection ratio as i would call it, ever wonder why somethimes you connect to the web and then just nothing, no data coming or going, thats because they have to many people connecting and to few ports. in the conventional sense of a contention ratio(like with adsl) if more people connected you speed just went down. Of course they could allwasy to an esat effort and instead of giving people a decent service give everyone a **** service and pack more it. Again this is not connection ratio, in fact i dont know what its called. I just know when your talking about contention ratios yourbeing very specify to something that doesnt apply to dial up.

Theres bandwidth contention and theres modem contention. I've seen the term 'contention ratio' in both contexts.

now according to dangger these are monthly prices whic i fail to see how anyone could make money off.

The figure of 14,728 euros is per annum, not per month.

jd

Originally posted by Boston
then thats not connection ratio as i would call it,

chill man...I just gave my view on the context longword used the term "contention ratio"..
anyway contention is an issue..

contention(1) Competition for resources. The term is used especially in networks to describe the situation where two or more nodes attempt to transmit a message across the same wire at the same time.

or
http://www.its.bldrdoc.gov/fs-1037/dir-009/_1245.htm
contention: 1. A condition that arises when two or more data stations attempt to transmit at the same time over a shared channel, or when two data stations attempt to transmit at the same time in two-way alternate communication. Note: A contention can occur in data communications when no station is designated a master station. In contention, each station must monitor the signals and wait for a quiescent condition before initiating a bid for master status. 2. Competition by users of a system for use of the same facility at the same time.

Boston

.

chill man...I

Just pointing out that the contention ratios talked about so much here are different then the conention ratios used for dial up. I did say "as i would call it" not as "you would call it" or "anybody else would call it"

Originally posted by SkepticOne
The figure of 14,728 euros is per annum, not per month.

fair enough, just pointing out thought there not the same thing . As for the monthly thing, that was my original point,i miss read bageer post and took it as 10,000 not 1000,its late. I worked it out at about 30 euro wholesale so i don't really see where "contention ratio's come in"

Btw i'd like to draw you attention to where i say isp's operate dial ratios on those free services of about 50:1(bt standard i think)
nice of you to inform me that theres "modem contention" i mean i never would have come to that conclusion, o wait i did

SkepticOne

Originally posted by Boston
.
Btw i'd like to draw you attention to where i say isp's operate dial ratios on those free services of about 50:1(bt standard i think)
nice of you to inform me that theres "modem contention" i mean i never would have come to that conclusion, o wait i did

Yeah, they can get away with pretty high ratios on these because a lot of people just use them for collecting email etc. I've seen 10:1 quoted a fair few times for flat rate.

Boston

Originally posted by SkepticOne
Yeah, they can get away with pretty high ratios on these because a lot of people just use them for collecting email etc. I've seen 10:1 quoted a fair few times for flat rate.

I liked you other answer better

zz03

Originally posted by Politics.ie
So what does this mean exactly?

So ‘twill cost an ISP EUR 100 per month inc VAT (in eircom network FRIACO access fees) to allow someone to stay online all the time using 2 ISDN channels at a paltry 128k.

Or EUR 50 per month if the ports are shared by two customers.

Or EUR 25 per month if the ports are shared by four.

Sharing at more than 4:1 will probably mean lots of busy tones at peak access times. Any offering will have to be scaled for peak times – otherwise they’ll end up with an M50 toll booth Naas Road to Dublin Airport queue saga.

On top of that there’s the internet feed cost, the ISP’s haulage cost (this is not a single or double tandem product) to get the feed to each exchange and a margin for the ISP to cover their operating expenses, financing costs and profit margin.

Not to mention the eircom charge for an ISDN line (BRA) (EUR 30.99 pm).

Cable and DSL surely win hands down on the economic and performance front?

zz..

SkepticOne

I've never heard of FRIACO being sold on as a dedicatated port to the end user. There is always contention.

I doubt if it will be attractive to very heavy users who will want DSL anyway. The pricing needs to be such that moderate users sign up, in which case a higher ratio will be possible. There is some debate as to what this price should be, however.

longword

Originally posted by SkepticOne
I've never heard of FRIACO being sold on as a dedicatated port to the end user. There is always contention.

The dedicated port is at the ISP, not at the customer premises. There's contention on two levels - the modems:users ratio, and bandwidth:modem port ratio.

SkepticOne

Originally posted by longword
The dedicated port is at the ISP, not at the customer premises. There's contention on two levels - the modems:users ratio, and bandwidth:modem port ratio.

I was responding to zz03, so my answer was in the context of how the 64k friaco port is split up. Sorry if I did not make that clear. My point was that I've never heard of this being offered under any retail deal on a dedicated basis.

zz03 said: "So ‘twill cost an ISP EUR 100 per month inc VAT (in eircom network FRIACO access fees) to allow someone to stay online all the time using 2 ISDN channels at a paltry 128k. "

longword

Originally posted by SkepticOne
I was responding to zz03, so my answer was in the context of how the 64k friaco port is split up. Sorry if I did not make that clear. My point was that I've never heard of this being offered under any retail deal on a dedicated basis.

zz03 said: "So ‘twill cost an ISP EUR 100 per month inc VAT (in eircom network FRIACO access fees) to allow someone to stay online all the time using 2 ISDN channels at a paltry 128k. "

He's right though. For an ISP to allow a user to stay online 24/7 with dual channel ISDN it will cost the ISP the best part of €100 in FRIACO access.

SkepticOne

Originally posted by longword
He's right though. For an ISP to allow a user to stay online 24/7 with dual channel ISDN it will cost the ISP the best part of €100 in FRIACO access.

Yes. I was not disagreeing with him, merely pointing out that I had never heard of retail flat rate being offered on this basis. You were confused about whether or not I was referring to the modem:user ratio. I hope I have cleared this up. It is the 64k port which is contended. Backhaul bandwidth may be contended, but this has nothing to do with FRIACO, the wholesale product.

parasite

any update of when this will be available to the end user ?

SkepticOne

Originally posted by parasite
any update of when this will be available to the end user ?

According to ComReg's press release, "Flat rate access is scheduled to be
available to retail consumers and business by 25 June 2003."

zz03

Originally posted by SkepticOne
Yes. I was not disagreeing with him, merely pointing out that I had never heard of retail flat rate being offered on this basis.

I was trying to highlight a number of practical issues the ISP will face offering flat rate dial-up services in terms of cost and service levels.

If an ISP offers a flat rate dial-up service and customers can’t connect when they want to (ie at peak time when they come home in the evening) they will be screaming and shouting about the ISP in question and their busy tones. It doesn’t really matter that between 01.00 and 17.30 every day there might be no problem getting connected.

To avoid mass customer complaint the ISP must purchase sufficient FRIACO ports on each eircom switch in the country to meet peak time demand. (FRIACO ports are just ordinary ISDN phone “lines” in reality which are sold in “packs” of 30 for EUR 14,728 + VAT per annum). The same lines can carry analog dial-up access and 64k is used up per analog dial-up customer - even if they connect at 28k or 56k.

Unlike the DSL ISP, the FRIACO ISP has to juggle with a variable FRIACO access cost and a flat fee on the income side – depending on peak time customer usage patterns.

To service a 128k ISDN customer who insists on being always on, the ISP will have to allocate 2 lines out of a 30 pack. This will cost the ISP 40.91 + VAT = EUR 49.50 per month per line = EUR 99 for 128k.

Moving away from the “always on” customer to the more realistic situation where each port ends up being shared – how many flat rate customers can an ISP sign up per port installed stressing again AT PEAK TIME?

I suspect that the peak time ratio might be near 4:1 – and if this is the case for the sake of argument, it would imply a cost of EUR 25 per month per customer to provide 128k FRIACO in terms of eircom FRIACO charges alone.

Compare and contrast with the ISP offering DSL. Nobody will have to suffer busy tones even if every customer in the country went online via DSL between 20.00 and 21.00. While things might slow down, the black and white “can’t get through” busy tone won’t be heard.

When you add the other costs – international ISP feed, the ISP’s backhaul feed to each exchange in the country over leased lines, and general overheads FRIACO looks like bad value for money.

zz..

skrobe

this might explain more . Headline in Irish INDO today(sat)
EIRCOM AGREE TO EUROPES CHEAPEST FRIACO DEAL.... part of story :

THE Commission for Communications Regulation (ComReg) has accepted a wholesale rate of €14,728 per annum from Eircom for the introduction of flat rate internet access, after prolonged negotiations between the duo.


This is the price that Eircom will charge other operators for the provision of a Flat Rate Internet Access Call Origination (FRIACO) service.

It translates as a basic monthly charge of €12.77 although there are other administration and process charges that will be added on to this figure, which applies to a 2 megabit connection per annum.


It is believed that other operators like Esat BT and Nevadatele will now be in a position to provide a consumer rate of between €25 and €35 per month for an always-on internet service.


Market watchers said the wholesale rate is the cheapest in Europe.


j

bk

Originally posted by zz03
I was trying to highlight a number of practical issues the ISP will face offering flat rate dial-up services in terms of cost and service levels.

Yes there are a number of issues relating to FRIACO, however they aren't really all that big. The price quoted by Eircom is about equivalent to the price quoted by BT at the end of 2001 in the UK. At that stage in the UK FRIACO was well established and a proven commercial and technological success.

There is no reason to think that the same can't be done here in Ireland and that the issues relating to FRIACO will likely be solved here in the same way as they where solved in the UK.
Remember both UTV and EsatBT (through BT) have a great deal of experience in running FRIACO networks in the UK.

As long as Eircom plays fair then there is no reason why FRIACO can't be rolled out in a timely and efficient manner.

BTW two points:

1) No one ever said FRIACO was a 24/7 always on product, that is DSL, FRIACO is a dial up when you want product.

Contention Ratios will be dealt with in the same way as it is in the normal dial up world, but with lower rates probably due to greater use.

2) I don't believe Dual channel ISDN is offered as part of any FRIACO product in the UK, I believe normally if you want this, you have to get two FRIACO accounts or a special FRIACO account that is more expensive then the norm in order to take into account the extra expense.

I'm sure it will be the same here and it is only fair.

bk

Originally posted by skrobe
Market watchers said the wholesale rate is the cheapest in Europe.

As usual the press get it wrong, the price is very competitive but certainly not the cheapest, BT offers much cheaper rates now.

I certainly believe we could see EUR 25 products coming from this, come on UTV

SkepticOne

Originally posted by bk
There is no reason to think that the same can't be done here in Ireland and that the issues relating to FRIACO will likely be solved here in the same way as they where solved in the UK.
Remember both UTV and EsatBT (through BT) have a great deal of experience in running FRIACO networks in the UK.

There are a number of techniques that can be used. Idle cut-offs and periodic mandatory cut-offs, warnings to extremely heavy users who take up ports, etc.

I know there will be a lot of people here thinking "that's crap, I'm not having that! I want 24 hours of uninterrupted use.", but flat rate is probably not for them. These people probably want DSL anyway.

Flat rate dial-up is primarily for the much larger number of people who don't spend all hours on the computer and for whom these restrictions won't be a burden. These are the people the ISPs will want to attract. The attraction for these people will be a fixed bill each month and no call charges.

Now, if a 25 euro product in Ireland corresponds to the 21 euro product in the UK, then off peak packages in Ireland should also be possible. These are what I would suggest will be the most attractive to the largest group of 'normal' users. If the ISP can get a lot of these, then modem ratios aren't such a huge problem.

I think a lot of people are making the mistake of comparing DSL and dial-up on purely technical merits.

zz03

Originally posted by bk
At that stage in the UK FRIACO was well established and a proven commercial and technological success.

Have you read this then?

1) No one ever said FRIACO was a 24/7 always on product, that is DSL, FRIACO is a dial up when you want product.

BT actually call their 150 hour limited product "24/7". And they get away with it too!

Contention Ratios will be dealt with in the same way as it is in the normal dial up world, but with lower rates probably due to greater use.

Contention ratios are fine most of the time. The ISP will have to buy lots of FRIACO capacity to deal with the peak two hours of the day - which capacity will be idle for much of the rest of the 24 hour period.

2) I don't believe Dual channel ISDN is offered as part of any FRIACO product in the UK, I believe normally if you want this, you have to get two FRIACO accounts or a special FRIACO account that is more expensive then the norm in order to take into account the extra expense.

Under the 150 hour "24/7" BT plan one can use two channels for 75 hours.

zz..

zz03

Originally posted by SkepticOne

I think a lot of people are making the mistake of comparing DSL and dial-up on purely technical merits.

It is not a single dimensional issue.

Dimension A = Eircom's pricing strategy for FRIACO ports
Dimension B = The Irish consumer's level of patience with busy tones at peak times
Dimension C = The real network costs of using a switched network for handling the final leg of what is a packet based service.
Dimension D = The loss of revenue to the incumbent from the loss of other dial-up traffic while a line is being used for dial-up internet access
Dimension E = The costs ISPs will have to incur to roll out FRIACO access to every exchange in the country. (The DSL rollout using wholesale bitstream is far easier).
Dimension F= The bang for the buck. FRIACO is what narrowband users have at the moment, only probably slower with higher usage and contention. DSL is a completely different experience.
Dimension G = In the few other countries it has been tried it hasn't been very successful.

zz..

SkepticOne

Originally posted by zz03
Dimension A = Eircom's pricing strategy for FRIACO ports

Dimension D = The loss of revenue to the incumbent from the loss of other dial-up traffic while a line is being used for dial-up internet access

Could you expand on points A and D. Aren't these fully addressed in the FRIACO documents from ComReg.

The other points are fairly obvious.

Boston

Originally posted by SkepticOne
Could you expand on points A and D. Aren't these fully addressed in the FRIACO documents from ComReg.

The other points are fairly obvious.

Sorry haven;t botther reading the rest of this stuff but, as far as i can see eircom make allot more money suppling 2mb's for adsl then friaco. and several times that again for leased lines.

anyway i would just also liek to point out that the wholesale price is but one cost involved.