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Telecom’s Broadband – getting there but room to improve

I decided to check out with Telecom’s broadband sign-up page to see how the impact of Telecom’s ongoing transformation is affecting end users. Overall things seem much easier to navigate than previously, and the plans are better. But there are still gaps between what I saw and where Telecom could, and should, be.

The Technologies

The broadband landing page is great – although one could argue that starting with a technology rather than a use case is going to alienate a good percentage of people. The little speedos by the titles help though, and it’s great to see the UFB prices advertised as the same as VDSL.

The Plans

The UFB (why would you want anything else) plans are on the low side, but the data caps are consistent with the other two technologies offered, so I guess that’s one less thing to think about. I would really like to see an additional much higher cap so that families can rule forget about the constraint of caps. I’d also like to see the ability to have or at least see a guaranteed CIR – committed information rate of the line – both domestically and offshore. There is, for example, no point having a 100 mbps UFB line to the exchange if your data then goes through congested local or international backhaul that gives you under 1mpbs in reality. So why not guarantee a minimum speed, and why not charge for increased professional grade packages?

The way the plans are displayed is admirably simple – but it was only on the second visit that I picked out the 100mbps UFB option. The xDSL naked option is similarly hidden.

Address

Once you pick a plan, and I like that this happens before the address checker, it’s time to find your address. I feel that Telecom misses a trick here by not welcoming their mobile customers (like me), who already have a relationship but perhaps not a fixed-line. I’ve spend tens of thousands of dollars with Telecom, so surely a kick-back would be in order?

And for folks like me who have a fixed-line internet with another provider, but no phone line (or unknown phone line) there is no explicit option beyond “I am new here.”

To UFB or not UFB

And then it all ground to a halt with a fundamental error. While UFB has been available in my street for some months, Telecom is simply not offering it to customers.

There are over 30 residences at this address, but perhaps Telecom has decided that multi-family and high occupancy dwellings are just too hard. That’s perhaps a reflection of Chorus playing hardball with buildings (it’s all about a required bit of equipment called an MDU) and it’s also about ISPs having no power to drive Chorus to deliver to the end user. I’d like to see Chorus pay for this, and certainly they should get zero credit for “passing residences” when there is seemingly no willingness or ability to actually connect.

But back to Telecom. I this case they are simply wrong, as one other ISP, at least, is getting UFB installed into this building. Thanks indeed to the ever-awesome Vibe Communications, who usually target large corporate and small ISP customers.

So I strongly recommend that you shop around if you see the message above, and at very least check the UFB rollout map (which shows my residence as being in the UFB zone).

Caps Pricing

The pricing is as seen earlier, but the choices for what happens when you go over a data cap are not good at all. You can choose to either lose your internet (64kbps will not run anything), or you can pay an extortionate rate per GB. While, for example, the first 500GB on the maximum plan costs $129, the second 500GB would cost $500, and let’s not forget that the UFB line rental overhead was paid for out of the first 50o GB.

Fixing the way data caps are charged

Nobody can predict with certainly how much internet they will use, and everybody (especially in aggregate) is using more and more GB of data over time. So charging like this has three strongly negative  impacts.

  • Customers who over-estimate how much data they will use will pay more than they should – and be very unhappy with Telecom
  • Customers who underestimate how much data they use, will pay more than they would have if they were on the right plan, and so will be very unhappy with Telecom
  • All customers will experience a chilling effect on data use – with a bias towards using less internet than is natural, and this bias is holding back society and the economy. That makes us all very unhappy with Telecom.

There is a solution, and to me a fair answer here is simple.

Telecom, and other ISPs, can automatically charge customers at the appropriate rate for their data use. Use 40GB or less one month? Pay $85 that month. Use 458GB the next month? Then pay $129 for that month, and so on. For households that use over 500GB, why not charge at a pro-rated rate per GB at the $129/500GB rate. Even better, charge $149 (say), the 1TB rate. And for those who want to cap their bill, allow them to pick a maximum before throttling, and provide them plenty of warnings.

Fixed line Phone

I like that the internet offering is not pushing calling as a priority, and it feels like a big shift from the past where the process was to get a phone line and add internet. Good.

But the calling options could be better – they seem to be very specific deals that depend on who you call and when – why not offer a simpler “all you can eat” plan?

Contract or no contract

The contract page is problematic. There is a very strong push to sign customers up to as 12 month contract (this is for VDSL – there was no UFB option for me). Contract for 12 months and you save $300, and get $100-$130 of value. Don’t contract and you retain flexibility but pay $300 for the privilege. I almost never contract – as I don’t want my ISP telling me where I can live or preventing me from switching.

Why not recognise that customers who pay up front are quite valuable – and why not give them time-related loyalty bonuses? For example “If you are still with us after 12 months – you get a month free”. But more importantly, the 12 month contract customers are paying for that $300 up front cost in their monthly payments – so why is there no monthly discount for those who are taking on the installation costs?

I really did like the installation option to pick a date and time. Well done to Telecom (and the wider industry that makes this happen). I wonder how it works in practise.

Details details details – far too many

The next page asks far too many personal details for your account set-up. It starts with the personal and gets worse. I see no reason whatsoever that my ISP should know my relationship status, date of birth, number of credit cars or next of kin. I have no confidence that this data won’t be exposed to many people, and I have no confidence that it all be kept securely.

There is a better way.

Powershop, which also delivers a variable amount of service over a fixed line to the premise, asks for your name, date of birth, email, contact phone number and address for service. They also want property details, a password and payment details. I’d really like to see them remove date of birth, but there is plenty that Telecom are axing that is clearly not required for a utility.

Privacy

Back to Telecom. I do like that you can get around some of the hideously personal fields with privacy friendly options, though you do need to hunt, and you may in effect have to lie on the form (e.g. employment), which is likely against the terms and conditions.

Overall

And that’s it. There was a summary page and a submit button. That last page (no screenshot sorry – as it was just the fake details I had entered) didn’t give me much confidence that Telecom where going to deliver the service – just that they would think about it.

Score

Telecom’s process and offers are much improved, and very well done for that. But we are not there yet. The plans can be made fairer (and a march stolen on competitors), the UFB access to multi-resdence dwellings needs to be solved, and more faster and larger options can be provided. A solid B, with a commendation for improvement.

Over at BigPipe, Telecom’s secret simple broadband brand, they seem to be doing a lot right. The sign-up is far less invasive, and the plans are unlimited and it’s month to month. But there is no UFB, a requirement to buy your own modem (why not sell one) and it’s a low-rent brand that many people would not feel comfortable with. But why not replace the Telecom offers with ones like these?

Lance Wiggs is an independent consultant providing management, strategy, growth and valuation consulting to industrial, media and internet based businesses. He blogs at Lancewiggs.com

Comments and questions
18

The MDU you refer to isn't a bit of kit, it's the TLA for "multi-dwelling unit" or apartment block/business park/row of town houses/whathaveyou.

I'm hearing from an increasing number of customers who are in the UFB area, have UFB in the street but are told they can't get connected to the UFB.

Perhaps this goes a long way towards explaining why uptake is so low. It's not that nobody wants fibre, it's the customers are told they can't have it.

Thanks.
My understanding is that "something" needs to be ordered and that this takes months.

it seems to me that RSP's are cherry picking where they want to provide a service. I have a choice of only two where I live, neither of whom are Vodafone or Telecom. Any idea why this is Paul?

Not all the ISPs are signed up to sell the UFB with all the UFB fibre partners. It makes for a patchwork quilt of availability and can be quite tricky to navigate.

But it's a commercial market so if the ISP you call won't serve your needs, vote with your wallet and find one that will.

So why did you feel the need to criticise Chorus about not being offered a service by Telecom, and praising Vibe when they could. Clearly you live in a MDU (multi dwelling unit), in a Chorus candidate area. Vibe will be providing a UFB service over a Chorus access into said MDU. Clearly you need to do your homework.

Vibe had to work very hard to get their access, nothing us here yet and it's been months.

I live in an apartment in Auckland that has fibre and after talking to numerous people the hardest part for any of the LFC's is dealing with permission and consent.

None of the LFC's have rights to enter an apartment or (Multi Dwelling Unit) as the internal infrastructure (i.e. the copper cables/riser conduits) are private assests to the buildinging owner/manager body corp etc. as far as i can figure with my own install (as well as knowing my building manager personally) it took ages of negotiation before they let Chorus do any installs here.

I wonder if the government can do anything in the way of getting building owners/managers or body corps to get more involved and help the LFC's?

Cheers for the analysis Lance - and I'll take a solid B from you as a grade any day. You raise a number of fair points - some of which we have already nailed e.g. a kick back when you have both mobile and broadband with us (but maybe we need to make this more obvious) - some of which we are already working through (watch this space) - and some new ideas which I'll get on the team's radar now. Thanks again.

Good to hear Jason

Maybe you should do a thorough review of all ISPs sign up pages Lance, see who has the best?

Or maybe one of those ISPs could pay me to do the same.

Not a bad idea.
What are your credentials for analysing web site UX?
I know you were at McKinsey where you would have written a lot of powerpoints, you failed with Pacific Fibre and failed with Punakaiki, and write a lot of blogs, but I don't remember reading anything about doing any UX/UI qualifications, or even having much experience in the actual building of websites.
Maybe if you demonstrate that you might get some work?

Free local calls.....in the old Auckland. No adaptation to the er, supercity in Telecom. Try calling Whangaparoa or Waiuku on the 'free' line.
Obviously still paying Reynolds' pension or some other freebie they gave him instead.....to get his exceptional talents!
Now there was a 'Spark'.

if you are still using a landline B.S. Bertie then it is you who is behind the times.

RE MDU's, the problem is not an unwillingness to get fibre installed into the MDU. The problem is first of all gaining consent from the owners. It is a long and drawn out process thanks to this legislative requirement to get consent from all owners.
But yes, some Service Providers do seem to exclude uncabled MDU's, Right of Ways, and fibre only subdivisions. Shame really, better option would be to say yes you can have it but we need to get through this process first. That way the process can actually be kicked off.

ICT Minister Amy Adams has ruled out making the UFB a designated service under the Resource Management Act, which would allow Chorus and the LFCs to lay fibre into a multidwelling unit or down a right-of-way without getting every owners' consent. Chorus has lobbied for such a change. Ms Adams told NBR readers it was nont on the table - see www.nbr.co.nz/ask-amy

They ask for DOB because they can't sell to under-18s.

" I’d also like to see the ability to have or at least see a guaranteed CIR – committed information rate of the line – both domestically and offshore."

Can you explain how any service provider, in the world can guarantee CIR outside their own network. It's the internet. There are many factors outside the control of a service provider. The first thing that will happen if ISP's start guaranteeing offshore speeds, is people complaining they don't get that, to some 3rd world country with a small pipe.