[AusNOG] NBNco: "Let's start competing with our customers!"

[Paul Brooks]

On 17/09/2015 3:25 PM, Paul Wilkins wrote:
> have a think about how local pizza
> shops manage to survive in competition to national pizza
> chains/franchises, who will have lower costs. They're all
> fundamentally selling pizza, so how do local pizza shops get away with
> not only selling the same thing, but probably make a much bigger
> profit when doing it?
>
> Depends if you want something that someone has repackaged from an industrial toxic
> spill, or a pizza.
>
> ISP's otoh largely can't differentiate their product.
Seriously?
iiNet/Westnet dined out on better customer care
Internode had a rep for excellent network, a premium service they could charge a
premium price for.
DoDo has a different niche.
Some offer FetchTV over their network. A local/regional player could have a
dropin-centre where customers can bring in their devices for
cleaning/debugging/upgrading. Some have more peering than others.
Internode is (was?) the only major IPv6/IPv4 dual-stack service around - which is
ridiculous, since anyone can supply IPv6 through Telstra Wholesale ADSL.

Differentiate yourself - turn on IPv6 for your customers, then shout it from the rooftops.




>
> Paul Wilkins
>
> On 17 September 2015 at 13:07, Mark Smith <markzzzsmith at gmail.com
> <mailto:markzzzsmith at gmail.com>> wrote:
>
>     On 17 September 2015 at 09:57, Noel Butler <noel.butler at ausics.net
>     <mailto:noel.butler at ausics.net>> wrote:
>     > On 17/09/2015 09:37, Paul Brooks wrote:
>     >
>     > On 17/09/2015 7:56 AM, Skeeve Stevens wrote:
>     >
>     > I am saying that while the CVC should be like $2.... if they aggregated
>     > their PoI's, you'd need a lot less because it would scale much much more and
>     > it would actually costs less.
>     >
>     >
>     > Methinks you're confusing topology with charging model. If you negotiated
>     > your wholesale backhaul provider to just add up all the traffic on all the
>     > POI ports and charge you for the aggregate, rather than per physical port,
>     > it wouldn't matter how many actual POIs there were.
>     >
>     > This whole mess also seems to hang on two assumptions:
>     > 1) every ISP needs to service the whole national footprint
>     > 2) every ISP needs to charge the same uniform retail price all over the
>     > footprint.
>     >
>     > Are either of these true?
>     >
>     >
>     >
>     > Of course they are - unless you want to be blasted into extinction
>     >
>     > 1 - a necessity to compete/survive
>     >
>     > 2 - a necessity to compete/survive
>     >
>     > I'm truly amazed someone on THIS list assuming they have any RSP experience
>     > even asks such a question
>     >
>     >
>
>     If small players think they can out capitalise and out scale of
>     economise much larger players, then they're never going to win.
>
>     As a smaller RSP, If your only competitive advantage is your lower
>     price, then you're vulnerable to your competitors lowering their
>     prices. That is an easy and low effort decision by your competitors,
>     and if they have larger margins to do it, because their scales of
>     economy are larger and as they get larger volume discounts from their
>     suppliers, they have much more room to lower their costs.
>
>     It is a race to the bottom, and since you're starting much closer to
>     the bottom than your competitors are, you'll lose (they will probably
>     get in trouble for using their market power to crush you, however you
>     may suffer a fatal blow before they get taken to court, the court case
>     occurs etc., etc.)
>
>     You're far better off trying to find something that your competitors
>     can't or won't do, creating a barrier to entry. Then you have a unique
>     advantage (i.e., a natural monopoly), which means customers must come
>     to you to get it because they can't or can't easily get it from
>     anybody else, and you can charge what your customers are willing to
>     pay for your unique value, rather the same or a few percentage points
>     lower than your competitors' prices.
>
>     If you don't think this works, have a think about how local pizza
>     shops manage to survive in competition to national pizza
>     chains/franchises, who will have lower costs. They're all
>     fundamentally selling pizza, so how do local pizza shops get away with
>     not only selling the same thing, but probably make a much bigger
>     profit when doing it?
>
>
>
>
>     >
>     >
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