I won't go in to the details, but suffice to say they would like us to do more FTTC. This makes a lot of sense at their competition still don't have FTTC yet, so it is an area where they have an edge.
The problem is that the offer they are trying to make is so confusing even our account manager cannot answer the most basic questions. He is trying, and we have a good account manager again, but it such a complex mess, I am not sure anyone really understands it. I mean, who has a clawback for a cease in 12 months on a service that has a 12 month term (and hence gets 12 months paid, whatever), that makes no sense at all.
We have spent weeks trying to work out the offer, and even get it tweaked to make sense. We would love to offer our customers an incentive, and we are pretty happy to pass on any offer pound for pound to customers. Sadly that is not to be, sorry. We really have tried. We suspect we will gain some benefit from more FTTC lines over the next few months, but exactly what is really not clear. I was seriously considering saying "no", forget it. If we can, we'll see if we can do something on units tariffs next year anyway. Fingers crossed.
What I found most amusing is a comment from farnz, one of our more technical and understanding customers, who said the following. Sadly, what he is saying is easier to understand than the offer we actually have, IMHO.
Yeah - you want something simple like "regrade from ADSL to FTTC, pay £50 instead of £100", you got something like "with probability e^-1/pi², an FTTC upgrade on certain exchanges will be £10 instead of £100, but only if the goat bleats".
What about telling them or is it Openreach to get the finger out installing it then? My Exchange (01631) RFS just put back ANOTHER three months ......
ReplyDeleteWell, yes, indeed.
DeleteWhat we really need is an easy way to get off our straight-to-exchange lines
ReplyDeleteThere is an FTTC cab just down the road, but our lines are straight to cabinet.
We will never, ever get FTTC on these lines and so we're stuck with a 4Mbps line to run an IT company of 10 when the houses down the road get 60Mbps FTTC
Office I'm in at the moment, we've got nearly 20 web devs running off two ADSL lines. The BT exchange is on the opposite side of the road to us. It's silly that people further away can get better speeds!
DeleteShame for the "exchange lines", BT don't offer FTTP...
whoops, typo,
ReplyDeleteThere is an FTTC cab just down the road, but our lines are straight to the exchange. **
So, if it's so complicated, then how come the likes of ZEN can offer a simple 'reasonable' deal.Without phone, they offer free setup and a shade over £30 per month. Are they assuming their service is so good they will get 2+years out of a customer so make more profit down the road ? They are by no means the cheapest either but were voted second best in the thinkbroadband polls behind some local ISP ;)
ReplyDeleteSome companies do gamble on long terms, and even have long terms in their contracts, and so do a free or cheap install on that basis.
DeleteNote that Zen are in the process of switching from BT Wholesale backhaul to their own backhaul provision. In theory, this will let them provide the same quality of service for less money, but in practice it depends on the details of their backhaul network and on the demand being placed on the network by users.
DeleteThe advantage of BT Wholesale backhaul is that it's easy to ramp up capacity if you get your planning wrong; the disadvantage is that it's expensive and you can't see where the hot spots that will congest with traffic growth are - you rely on BT getting that right.
The advantage of your own backhaul, as Zen are doing, is that it's cheaper and you can see your hot spots and plan around them. The disadvantage is that getting more backhaul on line to fix problems can be a slow process - whereas BT Wholesale will fix hot spots without your involvement, and will bring more capacity online to you in a matter of days, your independent backhaul can take months to upgrade a link capacity.
So, if Zen have done their calculations properly (including correctly predicting the change in demand that will happen as a result of their new pricing), they're in a good place to keep offering high quality service for affordable prices. If they've miscalculated at any point, they're going to be in a position where they can afford to fix things, but not in a timely fashion.
What's more, if they do have such a problem, it's almost certain to be localised - so Zen may be perfect for me, in Oxford, and completely unusable at AAISP HQ in Bracknell. Given Zen's current reputation for high quality service, it's going to be difficult to get help diagnosing the fault until Zen acknowledge it - and they have an incentive to not do so, as such an acknowledgement will be an admission that the guys responsible for the latest round of expansion fouled up.
The other potential problem for Zen is that they'll be locked into buying the backhaul they've paid for for some time; as long as they can get income to stay high enough to cover the backhaul they've contracted into, plus any extra they need, they're OK. If they do this big spend on the assumption of income growth, then it never materialises, they're in trouble.
The final worry, which hits everyone who runs a backhaul network, is whether they've done their sums just before a step change in usage; if, for example, the new games consoles massively increase people's ideas of "reasonable" usage (as video on demand did a while back), Zen's perfectly good calculations may be ruined by their assumptions being broken.
You should appreciate that I'm writing about the worst cases here - I'm actually confident that Zen have got it right, and the only end user impact will be same high quality service for less money than before, but it's worth understanding the risks Zen are taking to get there.
I blogged about the FTTC upgrade costs which make it a tricky decision whether to upgrade or not ... http://natalian.org/archives/2013/09/28/Superfast_Cornwall/
ReplyDelete