The outspoken chief executive of broadband provider Exetel has blasted a series of plan changes by rival Internode yesterday as a “joke of an announcement”, claiming the move represented “desperation” in the face of Telstra’s recent attempt to win back market share in broadband.
Internode yesterday deleted some 60 of its 78 broadband plans from its roster, drastically simplifying its options and adding several ‘packs’ that could be added onto new standard plans. However, in a fiery post on his blog this morning, Exetel chief Linton lambasted the changes, claiming the move was “simply the desperation of a bunch of accountants, who say: ‘We need more money to pay the bills, but you can’t incur any more cost’.”
Linton claimed several of the items offered by Internode in its $10 Power and $30 Business add-on packs actually cost the broadband company “nothing”, and that it was getting away with charging “the dumber customers for it by pretending it’s got some value”. “Now, if that isn’t desperation, I don’t know what is,” he said.
“You will see similar attempts by more and more suppliers in the not very distant future,” said Linton. “It is part of the ever encroaching dishonesty in the selling of communication services to residential users that was always a problem, but, thanks to Telstra’s efforts over the past two years had become endemic.”
An Internode spokesperson has been invited to respond to Linton’s claims.
Linton’s argument is broadly that Telstra’s recent marketing push into the broadband area — which has seen it cut plan prices drastically and boost quotas on its offerings, in an effort to make them more competitive in the market. The telco has also introduced a range of bundled offerings with its other product lines — for example, mobile.
Since that time, rivals like iiNet and Internode have sought relief from the Australian Competition and Consumer Commission with relation to the company’s new pricing — claiming that the company was not making the same pricing available to wholesale customers as it was to its own retail division.
The full extent of the impact of Telstra’s fightback will be revealed tomorrow (Thursday) as the company publishes its half-yearly financial results. However, at its annual results briefing in September a trend in the area was already visible.
In the first two months of the financial year, Telstra added 32,000 fixed broadband customers, compared with a net loss in the previous year). In the same bi-month period, 176,000 mobile broadband customers had come aboard. The company added 608,000 in the past financial year.
In the briefing, Telstra’s new group managing director of its Consumer and CountryWide division, Gordon Ballantyne, said Telstra was engaged in a “fightback” effort in the fixed broadband market.
“The 600,000+ residential ADSL customers ‘won back’ by Telstra obviously came from other ISPs (including 10,000 over two years from Exetel) and it would seem from this joke of an announcement a fair few from Internode,” said Linton this morning, claiming providers like Internode were in a tough position as they had grown “fat, dumb and happy” in terms of their retail broadband pricing.
Image credit: Delimiter
/facepalm
…and people pay $20 to read this drivel??
Hell yes! It’s entertaining!
(plus you lot don’t have to pay it, I paid it and can export it out of the firewall ;))
The funny thing is, its quite apparent that he really doesn’t have as good a grasp on what his competitors are doing as he thinks he does- because these Power & Business packs Internode release mirror the previously-existing SOHO & Business plans. ie its not a new revenue source, its a plan simplification.
That and his comments are laughable. These packs are “a sign of desperation” but adding $10 to the cost of all grandfathered plans or adding a $3 “admin surcharge” isn’t?
LOL! Maybe if Linton bothered to read Whirlpool (which he won’t due to negative Exetel posts) he would have known that Internode has been talking about simplifying their plans for the last six months in direct response to customers suggestions on the Internode Whirlpool forum.
The guy is a joke.
He adds a bit of colour to the Industry. Which is good. Otherwise it’d be boring. :P
+1
Internode have been trying to kill the “geek premium isp” image for the past two years. When they changed tactics and started go more after regular users. Linton argument is right about “Dumbing the plans down” for the dumb users (It’s not desperation thou)
For node to do this. Meant they needed few things to happen
1. Simple plan for all services
2. Introduce simple plans that a normal human can understand using a T-shirt sizing system to reference how many GBs are in that plan
3. Phase out and grandfather existing plans
4. Cutting the fat down to 3-4 product types
Not sure there’s any real problem with the concept of broadening your market appeal though. If they stayed in the same position, that’d lead to failure, surely.
Which is why they heading that direction before the company bottoms out with all the geeks/nerds whom wanting “smoke and mirrors” of a premium service. Expanding the focus onto regular home and mum/dad/old people will means more potential for better income return
However the problem with Node. Alot of the ideas aren’t origin not producing original ideas and instead using examples of what everyone else is doing
There was a certain time between 2000-2006 where Internode was consider a company of innovation in DSL. But now sort of choose to remix what everyone else does
Cause seems like this process
IINET/Telstra do something new > Internode response > Internode releases cool thing copied > Fanboi rejoice > Adam Internet copy’s internode which copied IINET/Telstra action
I’d have to say that my observation is that Telstra does most of the copying. IInet certainly do seem to innovate, but I think Node do too. That said, there is always going to be copying of ‘good’ ideas between ISP’s .. such is the nature of competition, where customers expect you to offer the same or better benefits than ISP X.
He is not talking about the packs adding virtually no value (just money) on internodes plans, not Internodes process of simplification
I so hope iiNet buys Exetel out.
Better yet, Internode. :p
Best: NBNCo
Better yet, let the company die a natural death and let it never be spoken of again.
Bwahahaha like that’s going to happen :)
He’s the Pauline Hanson of Au IT.
or
Linton writes his blog for the choir.
Well, I dunno about Linton, but I for one turned into an Internode fanboi for a while yesterday when the plans were released. Value, after all, is in the eye of the consumer. I was delighted at the extra value to be gained for just $10 more per month. Given how dramatically they dropped my monthly cost with the release of the Easy Reach plans, I had no compunction at all in adding a $10 pack to get back my unlimited uploads and extra bonuses.
But then, I stick with Internode not for price, but for the quality of their service. Oh, and of course honest comments like this help:
GiantGuineaPig
Is there any reason NOT to move to a new @internode plan? i.e. any features being lost anywhere?
Internode
@GiantGuineaPig uploads are counted, but can be negated with a Power or Business pack, that’s probably about all
I mean, seriously – that’s in public for all to see, in a culture where companies won’t normally openly talk about what you lose out of their changes. Not to forget that Internode will indefinitely keep you on a grandfathered plan if you prefer.
I rarely drool at the mouth about my ISP, but I do frequently recommend them, purely because of service. Service means a lot more than price – it means my wife getting a Telstra line problem fixed with Internode as the intermediary, going the extra distance to ensure Telstra find a fault in their own exchange. It means talking my 75 year old grandmother through resetting her DSL modem to factory defaults and configuring from scratch – on two separate instances.
Maybe these are just representative of an unusual run of luck with their service, but I’m not so sure. These and other examples are why I stuck with them even when I could’ve jumped ship for much cheaper plans, and why now I’m thrilled at both savings and added value for minimal incremental cost.
But then, my internet just works, my phone just works, my voip just works, and my family have all the support they could need, when they need it. All with Internode, albeit via the Telstra wholesale line that is my only option. Of course I’d struggle to have any complaints, except, perhaps, my inability to get naked DSL with them, and the unlikelihood of an Agile DSLAM build in my exchange. But I’ll live with this as a great compromise.
+1 to this post
+1
Yep, completely agree on all counts. Plus, no peak/off-peak to have to work around. I can honestly say that I can’t ever foresee moving from Internode.
Linton of all people? Are you kidding me??
I agree that maybe Internode are charging a bit too much, but LINTON of all people pointing it out??
Okay I’m just gonna rise this plan by $5.
Okay sorry this plan is no longer available.
Hmm, I know, $3 admin fee! yeahhhh
Okay I’m just going to cut the quota on this plan, then increase it, then cut it again, then increase it, then remove it entirely.
…. etc.
Seriously, if anyone is pointing out ‘desperation’ or ‘instability’ with other ISP’s, Linton has no place…
He does change his approach frequently, it is true :)
The Power Packs don’t cost them anything?????
Maybe a second rate ISP can supply static IP and business support for nothing. But if you add redundancy to the network then supplying a static IP requires extra administration to allow for the route to always fall on the same LNS. Increased shaping speed certainly allows for greater costs. Having a proper business ADSL plan that has higher contention ratios and priority support queues certainly adds cost. Routing a /29 route adds admin overhead.
Contrary to popular opinion, the extra features in the power packs do cost Internode slightly more. Not that I’m using the word “cost” here loosely — cost in terms of resources and time are just as valid as currency.
Static IPs “cost” more because (a) they mean that an IGP needs to be in place, with a separate route for each customer connected. That just doesn’t scale well. It’s not impossible, but does put more load on the system versus dynamic addresses, which can be routed in entire blocks (typically 254 or even more customers will share a single internal routing table entry).
Also the power pack features unmetered uploads, as well as a faster shaping speed. Obviously, faster shaping means more bandwidth used, and bandwidth costs the ISP in terms of backhaul and transit. Uploads also cost both in terms of backhaul and transit. While uploads are more economical, typically being less than one tenth of the usual download rate, they are not free to the ISP. If everybody uploaded more, the ISP would have to buy more backhaul and transit to compensate. The money to buy that extra bandwidth isn’t going to come out of thin air.
Renai, we really need to talk about your (unhealthy) fascination with everything Mr Linton says. :)
It’s always amusing watching Linton rail against competition. How Telstra is the precious and all will bow before it. How all ISP minnows will be crushed (funny, many of the so-called “minnows” seem to growing, rather than shrinking).. etc.
He has a point of view. He’s welcome to it. That view point is often said with much ‘apparent’ conviction. And yet, most of the premonitions from the self styled Nostradamus and ‘Outsider of the Internet’ don’t come true.
Internode must be doing something right. Typically, you don’t ‘knock’ the competition if they are going quietly into the night.
Well, every industry has its eccentric outspoken people, and Linton is the ISP industry’s. I won’t agree with all he says, but I sure agree with a lot more of it than the corporate marketing guff we get from some of the other players … Internode obviously being one of the few sane companies.
Im surprised with Lintos ADHD business ethics he has enough time to comment. :p
Boots people, changes plans willy nilly every 5 minutes christ! :p
This guy obviously has no idea whatsover. These changes see my SOHO plan increase by 3 times the data for $10 less per month. How is that a “joke” to the customer?
Looks for the word instability in a dictionary and you will find John Linton’s photo under it.
Looking at the posts in Whirlpool and reading the “Exetel” section all I can say is what a joke.
John Linton shouldnt throw stones in a glass house
Haha… Another of Linton’s BS storys, I’m not even going to read this one as it’s a waste of time.
Must be a real slow news day to post up an article with any credibility.
Linton’s the laughing stock of #internode.
Uncle Walt rocks BTW ;)
Heh I wouldn’t say Uncle Walt rocks, but he’s pretty hardcore :)
Ok, lets agree on top bloke then ;)
Wow, Linton talking about “encroaching dishonesty” when isn’t his ISP the one who will quite happily sign you up, then boot you if you complain about the service?
“FAT” Internode plans…..I say “FAT” Linton “Joke of a Man”
If I saw him walking down the street, I’d smack him in the face
People might not like John Linton, his brutal honest approach could suggest he has little or not tact but on reality is this: hes right.
Ahahaha, and charging $20 for access to read the drivel on his blog doesn’t smack of desperation and “we need more money to pay the bills” ?
Umm, isn’t the $20 a donation to charity? I don’t think it affects their bottom line.
Yuh, it goes to the animal charity which Linton supports, if I remember correctly?
Sorry, but am I missing something? John who? Exetel? Ohh! That’s right, Exetel is some going nowhere ISP with a whopping 200,000 subscribers nationally.
I should have known it was that John Lindsay, after all he is so qualifiied and entrenched as a CEO of an important ISP as Exetel, I shouldn’t have been so naive.
Seriously, I’ve been with Internode since 2004 (when I could finally get ADSL) and I have been absolutely impressed with their service and pricing. I’d like to say to Linton, you get what you pay for… Austrlian call centre, quick tech support, plenty of free content available and dedicated servers just to name a few.
What does Exetel offer?
Actually, with all the consolidation that has been going on, Exetel is a fairly sizable medium-sized ISP these days … most of the majors have been bought by iiNet etc. As much as we hate to admit it, Exetel is a popular ‘named’ ISP ;)
I should have known it was that John Lindsay, after all he is so qualifiied and entrenched as a CEO of an important ISP as Exetel, I shouldn’t have been so naive.
Sorry I meant Linton and not Lindsay. My bad.
rofl .. John Lindsay .. omg … what a mistake to make! :-D
lol hilarious!
Renai LeMay and editor are losing readership credibility by running rubbish stories like this one. What value does this give their readers (if they actually want them) apart from a bit of entertainment?
lol “Renai LeMay and editor”
Careful Renai, your editor might sack you! LOL!
True — he is a tough bastard! A right royal asshole!
I’m hurt. Now I need to go and find out if I can sack you for comments that are, in fact, true :-(
—-
Matt
Delimiter Editor-In-Chief-Of-Doom
FYI, while you were out at that Dell lunch I drank the scotch that you thought you had hidden inside your PC case. I found it while I was updating the keystroke monitor I installed there six months ago, when I needed blackmail material to ensure you would honour my taxi receipts.
It wasn’t even good scotch!
Well, don’t imagine this will reflect well on your next performance review. However, I may overlook this infringement if you can send me clothes, money, and more drugs. It looks like the Dell reps want to party on, and I already sold my gold watch and underwear for the last round.
Also, why are you replying to comments? You’re meant to be writing damning exposes on evil government internets plans, damn you!
ROFL!
I just remembered. That wasn’t scotch. I couldn’t get to the loo in time.
Well, I mainly let Renai post this stuff for shits’n’giggles. What the hell, it’s only money.
I make more from my side business in tuppeny uprights, after all. Besides, my drug addiction and current status as a “fugitive” leave me little time to edit stuff. Also, some of the big words confuse me lots.
John Linton is the NEW John Russell(veradis) Both of whom are consumed with jealous of what Simon Hackett has achieved at Internode.
John needs to learn HOW to run a business properly first before commenting on another business of which his business cant even compete with.
“It is part of the ever encroaching dishonesty in the selling of communication services to residential users”
ROFL the dishonesty comes from the way EXETEL is known for in the way they deal with their customers.
Looks like Exetel is desperate, When are you closing down Exetel John. ?
Heh I think I may need to be doing a reminiscence post about Russell shortly :)
omg in context with an earlier discussion!
Best. Thread. Ever.
I wonder how many customers Exetel have lost to Internode recently.
Perhaps John is just throwing a little temper tantrum cos Internode keeps stealing his toys, err i mean customers.
I was a exetel customer until my contract was up and they sent me their you are no longer profitable you got 30 days to leave letter.
What made things worse and more inconveience and costed me a lot more money that I was a naked ADSL user.
Exetel has a gall to criticize their competitors when they treat their own customers like dirt.
Complain to the TIO and you get booted
Using Tech support you get booted
Go over some stupid limit and you get booted.
Also they seem to infuriate the customers by constant plan changes and then they boot the unlimited users then gets rid of the unlimited plans and then again they re-introduce the unlimited plans.
Their staff are arrogant and rude on their own forums and they enjoy belittling the customers as well.
Exetel’s unprofessional approach to their consumers is unreal at least what I have seen that Internode and other ISP show much more modicum of professionalism and respect to their customers.
I would never ever recommend Exetel to anyone and I won’t ever forget the way you have treated me as a customer for over 4 years.
Anyone who joins Exetel has to be barking mad in my books.
The guys clearly an idiot. He runs a terrible company that offers terrible service and terrible quality services, and is trying to have a go at successful companies that have proven their worth time and time again.
He should focus more time on getting healthy and preparing to retire, rather than open his clearly incompetent mouth.
Linton is the Bob Katter of the ISP world.
Greetings from Tully (via 3G dongle).
Putting aside the comments by Linton and the boringly predictable responses from the Internode fan boys (post any critical comment in the Whirlpool Internode forum and see how long you last!), what is interesting is the figures listed and the claw back of customers by BigPond once lost to ISP’s like Internode.
Looking at the post NBN world where BigPond and Optus compete with ISP’s with NBN packages, keeping in mind who the two biggest wireless providers with the tie up of media content and smartphone supplier lock-ins, it would have to make a lot of ISP’s very nervous indeed.
I guess Internode hope to sell a hell of a lot of Fritz boxes!
Talking about predictable responses… from a Telstra fanboi…
Here’s Telstra’s reality…
Results
Sales revenue declined 0.5% or $60m to $12,263m
EBITDA declined 13.9% or $737m to $4,580m
EBITDA margins declined by 5.8 percentage points to 37.3%
EBIT declined by 24.1% or $756m to $2,376m
Earnings per share of 9.6 cents was down 35.6%
Free cashflow declined 22.9% or $599m to $2,020m
Results on guidance
Sales revenue declined 0.5% or $60m to $12,263m
EBITDA declined by 12.5% or $663m to $4,654m
Free cashflow declined 35% or $919m to $1,700m
Hmmm, lots of “declined and down”.. in fact they ALL are…!
Good thing Telstra signed up with the NBN, conveniently to coincide with these miserable figures,
or you’d be out of a job and those shares would be $2, not almost $3…!
Let’s concentrate on the figures in this discussion piece instead of your usual ‘detour this way’ diversionary tactics.
“In the first two months of the financial year, Telstra added 32,000 fixed broadband customers, compared with a net loss in the previous year.
In the same bi-month period, 176,000 mobile broadband customers had come aboard. The company added 608,000 in the past financial year.”
Those customers come from somewhere, mainly other ISP’s as BigPond finally competes with fixed line ISP’s like Internode and iiNet on value.
Also 608,000 new mobile BB customers in the past financial year, hope there are enough punters around by 2018 to soak up all the NBN fibre goodness!
The wireless boom BB speaks for itself, and shows no sign of diminishing, and that is just the Telstra figures.
From your own figures there was an increase in fixed line subscribers whom will in all likelihood continue to be fixed line subscribers post NBN.
No one has denyed there is a wireless boom. There is, that is obvious. What there isn’t is a demishing demand for fixed line. So statements like “people are migrating to Wireless” and “wireless is the future” do not align with the reality. If that were the case there would be a decline in fixed subscribers.
So I don’t understand what you mean by “hope there are enough punters around by 2018 to soak up all the NBN fibre goodness!” Please explain.
Thanks NightKhaos, on the money again…unlike Telstra… LOL
alain says “let’s concentrate on the figures” without blah, blah…
Ummm that’s EXACTLY what I did… So let me AGAIN just for alain (advocate…LOL)…copy/paste… those figures…
Sales revenue DECLINED 0.5% or $60m to $12,263m
EBITDA DECLINED 13.9% or $737m to $4,580m
EBITDA margins DECLINED by 5.8 percentage points to 37.3%
EBIT DECLINED by 24.1% or $756m to $2,376m
Earnings per share of 9.6 cents was DOWN 35.6%
Free cashflow DECLINED 22.9% or $599m to $2,020m
Results on guidance
Sales revenue declined 0.5% or $60m to $12,263m
EBITDA DECLINED by 12.5% or $663m to $4,654m
Free cashflow DECLINED 35% or $919m to $1,700
And look at the actual declines…most HUGE
13.9%
24.1%
22.9%
35.6% earnings per share
Yet they still pay a 14% dividend…!!!!! Otherwise they would be tanked!
That’s the figures fanboi… so your Telstra loving motives are now showing why you are anti-NBN…
Is that you who started that comic site help TLS shareholders stop the NBN??? LOL!!!!!!!!!
Typical ExeHELL rude and obnoxious and John getting it all wrong
So I am a dumb internode customer because i have a power pack option to run my server with?
or is this a cunning way to try and poach internodes customer base? the sad truth is we would all be better of by a country mile with telstra demoted to just another isp provider
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