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  • Blog, Telecommunications - Written by on Monday, November 12, 2012 10:22 - 30 Comments

    NBN Co defends business plans

    Last week, Delimiter argued that by and large, the business plans released so far on the National Broadband Network were little more than more expensive versions of consumer plans, with providers virtually ignoring the kind of value-added features that businesses want and the NBN’s improved underlying service delivery making features such as better support unnecessary. NBN Co head of Product Development and Sales Jim Hassell has sent us this post in response.

    “Renai argues that the business bundles available over the NBN fibre merely “more expensive versions of the NBN’s consumer plans”. Let’s look at the facts.

    If you’re a sole individual running a spectacularly successful technology blog then multi-line telephony and faster fault restoration times probably seem like unnecessary bells and whistles. But for a burgeoning small business that wants to attract new customers, save money and grow then they are far more than niceties.

    The ability to run up to 50 business-grade phone services over a single fibre connection and benefit from faster fault restoration, along with faster speeds and far greater download capacity, will play no small part in helping them to maintain the edge over their rivals – both here and abroad.

    As for the price point, I’d argue the relevant comparison is not with NBN retail packages but with existing business packages currently available over the copper access network. It’s a comparison certainly being made by Delimiter’s own readers who claim that simply by moving over to the NBN they’ll be able to save thousands of dollars a month. Says “BBA”, who is eyeing an NBN-enabled business product with 100/40 speeds and a download limit 1TB that costs a grand total of $130 a month: “Saving more than $1000 and having 50 times the speed down and 20 up…well that’s priceless. There is no way you can be upset with these prices.”

    Many micro-businesses will be happy with residential-grade broadband, and that’s fine. We wouldn’t suggest anyone take a business service unless they see value in it. But as more ISPs begin to offer more services to more businesses in more parts of the country, then we’ll start to see more competition.

    Isn’t that the whole point of the NBN? To foster a level playing field in retail telecommunications for the first time. It’s NBN Co’s job to create an environment that enables a greater competition, more innovation and better choice for all Australia – including small business.

    But with the business features scheduled to be released over coming months on the NBN, service providers will be able to offer useful and valuable services for businesses more easily — and more affordably — than they can now over DSL.”

    Image credit: NBN Co

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    1. Posted 12/11/2012 at 10:28 am | Permalink |

      Have to agree with Jim here.

      • Posted 12/11/2012 at 11:08 am | Permalink |

        I’d be interested to know why so … I don’t think Jim actually did much to prove me wrong. Is it actually true that businesses will see faster fault restoration times on the NBN than consumers? And he didn’t exactly address the issue of the cost difference between NBN business plans and NBN consumer plans. Plus, nobody appears to actually be offering “up to 50 business-grade phone services” over the NBN yet … and what is the difference between business-grade and consumer-grade, for telephony? Probably integrated PABX as a service-style services; but nobody appears to be offering those over the NBN just yet either.

        Evidence, people, evidence :)

        • Posted 12/11/2012 at 11:58 am | Permalink |

          The wholesale business plans are quite different from the wholesale consumer plans.

          (1) – Wholesale consumer plans come with a 150kbps/150kbps dedicated voice channel at the highest traffic class for purposes of voice quality for home services, and the rest of the bandwidth dedicated to internet at the lowest ‘best effort’ traffic class. Wholesale business plans come with the option of a 5Mbps/5Mbps dedicated voice channel at the highest traffic class. The rest of the bandwidth can be specified with the three lower traffic classes to suit needs/application requirements.

          (2) – Within the data component of the wholesale business plans, NBN Co will allow organisations to prioritise their own traffic classes within that bandwidth, over and above the native NBN traffic classes. Such functionality was previously only available on REALLY high end services, pre-NBN. Currently, ISPs generally strip out any QoS tags you try and insert into your traffic, because it upsets their own traffic management systems to leave them in.

          (3) – NBN Co are/will be offering symmetrical services on their business grade plans, and with speeds of up to 1000Mbps/1000Mbps in about 24 months from now. Try getting that now without spending squillions a month on your own fibre pipe, or buying SHDSL.bis services, and maybe getting 25Mbps symmetric.

          (4) – Dedicated, prioritised 5Mbps/5Mbps voice channels will – (depending on the codec you use) – actually allow for more than 50 channels of voice. If you used G.729 for example, and set it at the best compression level, you could conceivably get around 300 voice channels. Most people use G.713 for VoIP – (because it’s free) – and you’ll get about 80 channels. This will re-birth the hosted PABX market, which has struggled – (due to bandwidth constraints) – over the last few years.

          (5) – All of these features, plus higher SLAs – (as you point out, I’m not sure how they would implement better SLAs as yet) – are why they cost more, and reasonably so. The wholesale price for NBN business wholesale plans start at $100pcm, so any RSP selling “business” plans at lower than this cost, are just packaging up the consumer wholesale plans and calling them business plans.

          (6) – At least AAPT and M2/Commander are offering these services, but they’ve not been out long, and not many customers know about these features yet.

          (7) – As Jim points out, for many businesses, the standard consumer level plans would be enough. But if you want need the better services, you need to pay more. Just like you have to now.

        • NPSF3000
          Posted 12/11/2012 at 1:02 pm | Permalink |

          “Evidence, people, evidence :)”

          What evidence have you provided again?

          Your entire argument appears to boil down to the fact you don’t seen any benefit… while many others can quite clearly see benefit. So the answer is easy, those who see benefit can pay the premium and those who don’t won’t.

          Instead you appear to be calling the plans a scam and largely ignoring the opinions of others. To quote from the last article:

          “But one thing I do know very well. Especially when you consider the basic service delivery improvements which the NBN will bring, no Australian business will be attracted to NBN packages which are just more expensive versions of consumer offerings.”

          Is purely your opinion – one that many here disagree with.

          • Posted 13/11/2012 at 9:59 pm | Permalink |

            TPG have been delivering 100/100Mbps uncontended unlimited internet for under $1000 for some time now. If that kind of thing is so important I am surprised it hasn’t had a better uptake….

        • Dan
          Posted 12/11/2012 at 4:50 pm | Permalink |

          I think Jim – like the RSP’s selling the “Business” plans – have both missed a crucial point.

          Simply adding support does not make a service a “business class” service.

          A “buisiness class” service has;
          1) KPIs that deliver
          - up-time guarantees
          - compensation for lack of connectivity over a specified period
          2) dedicated bandwidth which enables
          - higher traffic priority over ‘internet’ traffic
          - the ability to allocate your bandwidth to a QOS level at your router/border
          3) composite and fault tolerant linking options

          I agree with Renai, the business plans are just fluffed up consumer ones. A real business plan on the NBN would utilise at least two Data ports, one offering 1-5Mb symmetrical Class 1 for a phone service, and the other an asymmetric 50/20 or 100/40 with a guarantee of 5-40 Mb (or, for wireless, 25/5 with up to 5 guaranteed). Obviously the upper end of those ranges would mean more expensive plans. All would offer premium support and KPI reporting, as well as up-time guarantees.

          Eg.
          2MB sym (voice carrier) would be something like $120/m(?), plus $60/m for 100/40 AVC & $100/m for your dedicated 5Mb CVC is $150, plus data charged at $0.20/GB, say ~500GB/m on average is $100, total monthly charges of $380.
          How much cheaper is that than say 2 x POTS, 2 x BRI ISDN & (bonded 2Mb SDSL) 4Mb business SDSL from Telstra, all with no EMI affected lines, water in the wires, or random sync issues to worry about

          • Dan
            Posted 12/11/2012 at 4:51 pm | Permalink |

            And by KPIs of course I meant SLAs. Mixing up my TLAs…

        • Tinman_au
          Posted 13/11/2012 at 10:31 am | Permalink |

          Isn’t it up to the Business RSP’s (BSP) to offer those plans?

          NBNCo merely offers the capability to them, it’s up to the BSP’s to offer Aussie business the plans/features that your talking about and/or that they want.

          Without the RSP/BSP’s offering worthwhile plans, the NBN is basically a backbone provider, so in my view “the NBN” is a team effort between government and the mighty “private enterprise”.

          Wouldn’t it be ironic if the private enterprise component of the NBN “coalition” is what actually causes the NBN to fail to serve the needs of private enterprise! I love a good irony, but that would be a pretty expensive failure…

    2. Dean
      Posted 12/11/2012 at 10:47 am | Permalink |

      +1 to NBNCo for actually responding!

    3. Steven
      Posted 12/11/2012 at 10:58 am | Permalink |

      Someone forward this to the business loving Liberals. Surely the infrastructure ownership isn’t the money maker, it’s services that can be sold as well as the benefits to businesses all over Australia.

    4. paul
      Posted 12/11/2012 at 11:26 am | Permalink |

      The thing I can’t understand about the NBN in general and especially commercial plans is why the NBN is still using the ADSL model. What happens when a company wants to use video calling on Skype or quickly send a large dataset to client. This is when a fat upstream pipe is needed and NBN is failing.

      • Posted 12/11/2012 at 11:40 am | Permalink |

        You think 40Mbps upstream isn’t fat enough for a Skype call?

        Non sequitur.

    5. paul
      Posted 12/11/2012 at 11:54 am | Permalink |

      For one Skype call yes. But 10 or 20 while trying to upload a 10 gig of data?????

      • Posted 12/11/2012 at 12:00 pm | Permalink |

        Buy the 1Gbps/1Gbps symmetric plan when it’s released.

    6. paul
      Posted 12/11/2012 at 11:55 am | Permalink |

      oh and don’t forget the people you have using remote desktop etc

      • Michael
        Posted 12/11/2012 at 12:22 pm | Permalink |

        Firstly i think Renai is right in that Jim Hassell hasn’t actually disputed his orginal post. The add-on services that NBN offer are a great idea but that doesn’t change the fact that no RSP is offering them yet.

        In terms of how NBNco will deliver better response times and an SLA in the future (again i believe no RSP is doing this currently) is charging more for business connections, and providing 24 hour fault response to ISP’s. Business customers will also be prioritized over residential customers and for customers with critical uptime requirements NBNCo can sell an SLA to the RSP who passes it on to the customer.

        In terms of upload speeds on the NBN, the network design is based on GPON

        https://en.wikipedia.org/wiki/Passive_optical_network

        Which provides big cost savings over the alternative, direct fibre from the POI to consumer. GPON is based around the truth that while upload is getting more important it is still dwarfed by download requirements. Additionally by far the biggest upload type anywhere in the world is Bittorrent, which has (arguably) very few legitimate uses. At the least is has few important business customers. GPON can and will deliver symmetrical plans, but the vast majority will have no need for them.

        Also you are incorrect stating an “ADSL mentality” for the current plans.

        Adsl is 24:1 (and possibly 2), the 100/40 plan is 2.5:1. Big big difference.

    7. paul
      Posted 12/11/2012 at 12:02 pm | Permalink |

      I haven’t heard of any SDSL plans

    8. Soth
      Posted 12/11/2012 at 12:17 pm | Permalink |

      Guess time will tell when they release more Business Plans from different ISPs.

    9. Brad Cann
      Posted 12/11/2012 at 12:45 pm | Permalink |

      so NBN’s response is a few QOS changes on their end, and we will “prioritise” faults for business. For the average SME i suspect this will really mean slim to no real difference, as like most things, the small breakages are fixed rather quick, but this will still not fix the much larger outages. I suspect when it breaks it will break good enough and large enough that them SLA’s will mean SFA for restoration time.

      Short of someone cutting the fibre, the fibre MDF panel dying, most faults will likely be software in nature and quick call to the ISP support number should have it resolved in minutes, be it joe bloggs, or SME.

      • Posted 12/11/2012 at 12:49 pm | Permalink |

        Correct.

        But SLAs don’t just relate to faults and restoration times. They can relate to service levels as well – (which is why they are called “Service Level Agreements”.

        Do they pump the voice channel for a business account through the router first, or the voice channel for a consumer account first?

        That’s an SLA too.

        • Brad Cann
          Posted 12/11/2012 at 1:11 pm | Permalink |

          Short of them being massively overcommited, most businesses and consumer folk wouldn’t feel a small bit of jitter on a voip call, hell we’ve used telstra IPMan and i’ve seen and felt jitter on it, so its not like its a guaranteed service anyway.

          To my way of thinking, if you need an SLA like that your likely to be on the more larger corporate side of things and have a much higher bill with someone who specialises in this area. for the average SME of up to lets say 100 employees, i doubt the extra bucks will get you anything “more” and its certainly going to be a whole load more reliable then dsl is.

          • Posted 12/11/2012 at 1:41 pm | Permalink |

            Sure, but that’s no reason not to have SLAs.

            As a business, you choose a service that’s fit for purpose, and you agree to a set of SLAs to make sure it meets that purpose, continues to meet that purpose, and gives you a legal remedy if it does not.

            This is no different than what happens/happened pre-NBN.

            • Douglas
              Posted 13/11/2012 at 9:51 am | Permalink |

              Precisely.

          • SMEMatt
            Posted 13/11/2012 at 11:26 am | Permalink |

            Sure they don’t want an SLA until the Consumer DSL line they are trying to run the business on drops out completely for a couple of hours and comes back up a lot slower, then explaining what “best effort” is with regard to service levels and connection speeds.

    10. Douglas
      Posted 13/11/2012 at 8:54 am | Permalink |

      Renai – One of the key selling points of a business grade service is the ability to log faults (and have them worked on) outside of business hours.

      For example if you have a retail outlet and your consumer grade DSL goes down at 17:30 on friday afternoon, nobody will look at that fault (especially within the extended carrier) until Monday morning. You could essentially lose a whole weekend trade if you rely on your DSL for transactions.

      A business grade service is more expensive because you have people who will take your call at all times and actually work on it. Most business grade services have a 4 hour restoration target.

      I think you need to look at this like insurance, which I presume you buy? You could say that 99% of the time it is a waste of money, but it’s that one time you need it where it pays off.

      It costs real money in Australia to have people manning helpdesks and truck rolls 24 x 7 to ensure your business continuity.

      Regards,
      Douglas.

      • Posted 13/11/2012 at 9:06 am | Permalink |

        “For example if you have a retail outlet and your consumer grade DSL goes down at 17:30 on friday afternoon, nobody will look at that fault (especially within the extended carrier) until Monday morning”

        Sorry, that hasn’t been my experience. With iiNet, they tend to look at the issue immediately — and they have 24×7 support.

        Plus … you didn’t address my point about higher reliability under the NBN :) ADSL *does* go down. I don’t think the NBN fibre will go down very often at all.

    11. Douglas
      Posted 13/11/2012 at 9:48 am | Permalink |

      iinet (or any) DSL ultimately relies on Telstra’s copper. Telstra will NOT truck roll outside of business hours for a fault on the copper.

      If you buy a business grade fibre service from Optus/Telstra/AAPT they will truck roll 24x7x365 for faults. And they do happen, granted not as often as copper, but they do happen. There are lots of pieces that make up a PON that can break Renai, not just talking fibre cuts here.

      If you are using NBN as your sole business connection at the offices of Delimiter and:
      -The ONT fries
      -Your S-Tag/C-Tag combination is corrupted
      -Your overhead lead-in is taken down by a tree in a storm or a truck
      -A splice goes bad
      -A contractor cuts your underground lead-in or street distribution.
      -There is a fault in the splitter serving your street
      -There is a fault in the OLT

      Will you be happy to wait for X days for rectification on your residential grade plan? Or will you be expecting a speedy resolution to get your business running again?

      Just sayin’

    12. Tinman_au
      Posted 13/11/2012 at 10:50 am | Permalink |

      It looks like some BSP’s (Business Service Providers) are starting to offer some plans, AAPY and M2 for example, ( source: http://www.zdnet.com/au/nbn-business-products-fill-the-gap-aapt-7000007006/ ), but I think they need to work on their business specific stuff a bit more.

      Class 4 is “Best effort”, which might be OK for a corner store type business, but doctors offices etc will need the higher class traffic offerings (at least class 2 and/or 3).

      The ball is in the BSP’s court at the moment, it’s really up to them to come to the party and get the horse to drink. (I’m full of epigrams today!).

      • Tinman_au
        Posted 13/11/2012 at 10:51 am | Permalink |

        AAPY = AAPT




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