Those who have known us for a while will know that one of the unique benefits of our service is our daily billing method and the ability to “pause” our service at any time. This allows people who don’t need our internet connection all the time, such as for a holiday house or because they only have very sporadic internet needs (e.g. kids at weekends) to turn our service on for a day at a time. We do this by actually disconnecting the service while it is paused, but saving all the details so that it can be reconnected as it was before when required.

This is really only possible financially if there is no connection charge – a charge levied by the wholesalers every time a connection is established (or the retail service provider is changed). The practice dates back to the old copper days where to establish a connection Telstra would have to send a technician out to physically hook up the wire. In those days it did actually cost the wholesaler to do this. However nowadays with computerised provisioning (which takes just a few minutes), it costs the wholesaler nothing to do this. 

When NBN came onto the scene they decided from the beginning not to charge a connection charge, and based on this lack of charge we were able to develop our current pay as you daily internet product.

However Launtel are now providing services on other wholesale networks such as Opticomm and LBNCo. We were horrified to find that Opticomm were charging $69+GST and LBNCo were charging $99+GST. Since the merger of Opticomm and LBNCo, they are aligning the price at the higher of the two $99+GST in April 2021. The net result is that every time a service is “unpaused” we are charged $99+GST. This clearly makes pausing and unpausing completely unviable financially on their networks. Just to re-iterate this is a charge for an action that costs them virtually nothing due to their automated provisioning (which is very good, particularly on Opticomm, most services are provisioned in minutes).

However not only does this mean that we cannot offer our service pausing for the minority of customers on their networks, but it also has significant implications for competition as a whole. Every time a customer changes retail provider this fee also must be paid to the wholesaler (some retailers pass it on others do not). One wholesaler actually promoted this to us retailers as a way to reduce this “churn” – the retailers are more likely to get “sticky” customers, i.e. reduce competition. This feels very much like the old idea of a 12 or 24 month contract. We think this is a bad idea: customers should feel free to try multiple providers until they find one they like. Interestingly even in the old Telstra copper days the connection charge did not apply when changing retail providers.

We offer a no obligation free trial to our customers, while a good percentage go onto take the paid service, adding this connection charge further increases the outlay that we have to make to get a new customer.

There is also a perverse incentive around this connection charge: the wholesaler has an incentive to provide a poor service. Typically if a wholesaler’s network gets congested for an extended period of time due to overcommitted backhaul, customers tend to switch retail provider in the hope of avoiding the issue (which they can’t – all retailers use the same wholesale network). The wholesaler collects a connection charge each time the customer does this. In other words they profit from the overcommited backhaul.

We are surprised that the ACCC allows this charge at all – their stated position is that a wholesaler may not charge any more than an equivalent NBN service without special permission. Did they really not take into account these connection charges?

With the increasing use of 5G mobile broadband plans, wholesalers are coming under increased competition from the mobile network. The mobile network suits many people who move around a lot, which is particularly common in the apartment dwellings that wholesalers often specialise in, because they just pick up their router and take it with them. Our quick provisioning and daily pricing often also works in this market – people connecting up only when they need it. One wholesaler boasted to us that they had 80% of a block connected. What about the other 20% we asked, they probably have internet, just not your internet.

It is worth pointing out that these wholesalers are pretty much always monopolies. While the idea of infrastructure competition (multiple wholesale networks offered to an address) sounds good in theory, it very rarely actually happens. You end up with a bunch of monopolies instead. No new provider is going to roll out infrastructure to a building that already has existing infrastructure just to go into competition with incumbent – they are more likely to pick a building without any competition (or only a competitor using a poor technology such as FTTB). So while the developer may have a choice of provider, the end user, probably just a tenant of the building, has no choice and must go with whatever the developer chose.

While I said earlier that NBN do not charge a connection charge, they are proposing to introduce a small one of about $5. This is probably small enough that while we may have to pass it through, will not stop people pausing their service. However, we believe it is a move in the wrong direction.

We believe that connection (and churn) charges are a hangover from the past and now are just being used as a way to raise more revenue by the monopoly wholesale providers while avoiding raising their monthly wholesale prices. It is produces an anti competitive environment where even changing retail providers is harder than it should be.

Damian Ivereigh
Launtel
11/01/21

After 20 years the Launceston Football Club now has a new naming rights sponsor, welcoming Launtel on board where they will carry the nickname as the Launtel Blues.

“Launceston is our home, and the Launceston Football Club is also our customer. It’s exciting that as we’ve expanded nationally, it now gives us the ability to do more to support other grass roots organisations in our home community ” says founder Damian Ivereigh. 

In the 2020 season the Launceston Football Club won the Under 18’s Tasmanian Junior Grand Final, the Tasmanian Women’s Football League Grand Final, the Tasmanian Development League Premiers and the Tasmanian State League Grand Final. 

Attracting Launtel to this partnership was the alignment of values, investing in developing leagues,  and as the club motto notes “The will to win”.

Ironically, having the nickname ‘the Blues’ is the opposite to the reason Launtel was founded in the first place, that is, to be on the side of the customer and remove all the things that gave people the blues with the telco and internet industry. 

Club Sponsorship Director Malcolm Atkins said “The Launceston Football Club is proud to have a locally owned, nationally recognised company as our Major Sponsor.  We’re excited to be working with Damian and all Launtel in partnership in the years ahead.”

Launtel’s Fast and Flexible internet is now available at 11 million premises across Australia and now employ around 30 people.

Damian adds, “The club motto is ‘The will to win’ – Investing in future development, diversity, never standing still, playing fair and aiming high, we think Launtel and the Launceston Football Club have a lot in common.”

We’re proud to announce that Launtel has won the national award for best Internet Service Provider in Australia by Product Review with a 4.9 star rating out of 5. A rating almost unheard of in the telco industry. 

Unlike many other awards programs, every telco of reasonable size is in the running. This is not an award a telco can just ‘enter’ – it’s based on the most important measure, customer feedback. 

We’ve built a network around fixing all the things that frustrate people with the rest of the industry. Features like pausing for free when you go on holiday, and the ability to get an nbn connection turned on to an address in well under 20 minutes has actually had some people thinking our reviews were fake!

In line with ProductReview structure, the award is shared between the top 2 rating companies, and the other, while a very different type of provider to Launtel, is Mint Telecom, also Tasmanian. 

In May 2017, we were the first internet service provider in Australia to deliver Gigabit speeds on the nbn. In 2020, we completed our expansion to offer premium internet across the whole of Australia. This move to build a national network has now opened up 11 million more premises eligible for connection. 

In the period between 1 July and 30 September, the Telecommunications Industry Ombudsman received 32,801 complaints, that’s more than 364 complaints every day! This highlights the need for a telco that has been built differently from the ground up. Yet, we know that many internet users across Australia continue to pull their hair out dealing with their provider. 

I’d like to thank our team who genuinely care about the network we build and the service we offer, but also to our customers who are our greatest asset in providing constructive feedback as well as being our very best advocates. 

We’re committed to building a telco that’s as fast and flexible as the NBN was meant to be – also one that genuinely invests to give users a premium nbn experience. We’re ready for our growth and we’re proudly flying the Tasmanian flag of innovation across the country. There’s no better award to win than the one voted by our very own customers.

Thanks again, 

Damo and the Launtel crew

What features make Launtel special?

• No slowdowns at peak times – we show our network performance live.
• You can pause your connection when on holiday – no charge.
• Local support team with no call centres – quick response.
• Choose or change your speed up or down as you like (up to 1000Mbps in some areas)
• No fees to move house or business – do it within a few minutes
• No contracts or obligation – we focus on keeping customers through great service
• Free 7 day trial – no credit card needed
• Referral bonus for customers who refer a friend! 

In the past seven days we have seen two far reaching and unexpected announcements from NBN that have set in motion the next several years of upgrades to nbn V1.0 that was completed earlier this year.

As you may know, the original plan for the nbn was a universal FTTP model for the city and suburb areas of Australia with Fixed Wireless and Satellite covering the regional and remote communities.

With the election of the Tony Abbott Liberal Governments in 2013, this plan was altered to what is known as a Multi Technology Mix (MTM) network where other technologies, FTTN, HFC and later FTTC, were utilised to speed up and reduce the cost the rollout of the nbn by utilising some of the older copper infrastructure that had been deployed previously. It is arguable whether they actually saw a speedup or reduced their costs, but we will now never know for sure.

Launceston was lucky to be in the position where most of the deployment for FTTP had already commenced and we now enjoy 100% FTTP connectivity across the city and suburbs (the largest pure fibre footprint in the country) whereas other commercial areas in the state (notably Burnie, Devonport, wide areas of Hobart and other commercial zones such as the airport precincts) ended up with the FTTN network, a network that suffers from variable speed, poor reliability and quality and a hard limit of 100Mbps.

The twin announcements from nbn last week covered two main points;

• Enterprise Ethernet: That specially designated ‘Business Zones’ around the country would be earmarked to receive a lower priced premium business grade service of the nbn’s Enterprise Ethernet network if they choose. I have previously written about Enterprise Ethernet and debated the value that this service actually provides over a well provisioned regular nbn service on FTTP. However there is no doubt it is worthwhile improvement over the other technologies. These zones will see reduced pricing for new orders placed in the next 2 years and will be a quick option for businesses requiring more out of their connection than their existing FTTN/HFC/FTTC infrastructure can deliver. The process is to essentially pick a symmetrical speed tier and sign a 1 to 3 year contract. Nbn will then deliver dedicated fibre to your building within the following 3 month period.
  
  
• NEBS (aka “regular” NBN): The announcement about the upgrade of approximately half of the existing FTTN footprint to FTTP ‘enabled’ areas. This program will have a longer deployment timeframe and will involve fibre being run down the street into the existing FTTN areas of both business and residential areas. Any client that then wishes to order a speed tier from their RSP that their current technology cannot deliver will activate a works order for the nbn to visit the site and install the last mile of fibre directly into the premises. The exact mechanics of this ordering and delivery system are still to be announced.

Impact for our region

As I have mentioned in many previous blog posts, the future for any industrially advanced economy such as Australia is a strong and widespread fibre network. It’s the only technology that can deliver the large (and growing at 40% pa) amounts of traffic in an efficient, predictable and reliable manner. Since the completion of the Launceston portion of the nbn, all on FTTP, and activation of gigabit speeds across the city in 2017, Launtel have seen many local and relocated businesses from the mainland take advantage of the new possibilities and grow their businesses, without a limited internet connection getting in the way. From this point of view, Launceston doesn’t have much to gain from these recent announcements given the existing FTTP.

If we zoom out a bit though, these announcements will have a dramatic effect on the people and businesses in all the surrounding areas such as Burnie & Devonport, regional industrial hubs such as the Launceston Airport & Legana and all the surrounding small towns, not to forget the suburban areas where many small businesses start from the proverbial garage.

 

These areas are now on the cusp of having nbn services that are on a par to the services in Launceston and therefore being able to grow their businesses both locally and internationally just as we have seen businesses do in Launceston.

This will be a boon to all of these areas and will in turn have a positive economic effect on the whole region including Launceston. 

 

As an aside, there was also a further announcement made by nbn. This involved the provision of an additional $300M for regional co investment opportunities between local and state government and nbn. Launtel has recently been advocating for the State Government to step in and provide an upgrade path for the commercial areas in Tasmania that missed out on the FTTP rollout in nbn V1.0. This would have been a $50M investment in the digital infrastructure of the State and would have seen most business addresses in the state being upgraded to FTTP. The intention is to inject a post COVID stimulus and create an ongoing commercial return in more employment in digital businesses. Although the announcements made by nbn cover off a lot of these ideas, there will still be work to do. There are vast swathes of Tasmania that are covered by oversubscribed Fixed Wireless towers with no fibre backhaul and there will still be commercial and suburban areas that miss out on FTTP. 

A $50M co investment in the nbn by the state government is still a great idea, would expedite last week’s announcements and would enable a wider footprint to be covered.

While it is tempting to dwell on why we took this circuitous route and why we didn’t just do a full FTTP rollout from the beginning, at some point we have to put all this behind us and just acknowledge that we got there in the end. 

Damian Ivereigh
Launtel
28 Sept 2020

We very much welcome the announcement by NBN that they are reducing the monthly costs and mostly removing the up front fees associated with Enterprise Ethernet (EE). We expect that we will be able to offer this service in many more places and to smaller businesses than we do currently. More than likely this is NBN reacting to price reductions by other big fibre providers who they are in direct competition with and also making life harder for the fibre overbuilders. NBN are a business (though government owned) and they have a responsibility to maximise their revenue opportunity.

However we are very disappointed that this has not been accompanied by an equivalent investment in the regular NBN infrastructure (aka “NEBS”). The most obvious one being starting the upgrade to FTTP. NBN originally had a scheme called “NBN Select” where they were offering a fixed price (and relatively cheap – around $3600) upgrade to FTTP in various business areas. They were upgrading the in-street infrastructure and then inviting people to upgrade their individual premises. Once upgraded they are free to use whichever provider they like. This scheme seems to have mostly fallen away as the NBN Business team appears to now regard NEBS with a certain amount of disdain, claiming it is a low grade, residential, product.

While there is no question that Enterprise Ethernet is a good product, it is still expensive and comes with long contracts. It’s value is really only apparent when compared to non FTTP (HFC, FTTN, FTTC etc) technologies. While there are some use cases for EE where FTTP is already available, they are extremely rare in our experience. Most businesses only buy EE because the technology they have been given is not up to scratch to running a business. This is around performance, but much more importantly around reliability and certainty – the reliability and certainty that only fibre can provide.  

In some ways the fact the EE even exists is a testament to how poor the decision was to move away from the original FTTP rollout back in 2014. The original “business grade” product was Traffic Class 2, that ran over FTTP. Sales of this product were fairly poor because people realised that the standard, and much cheaper, Traffic Class 4 FTTP product was good enough for all but the large businesses. Most business applications (including conferencing systems: Teams, Webex, Zoom etc) do not need high quality, low jitter connections that EE or Traffic Class 2 provide – if they did no-one would use them. 

We have built our business on no contracts – because we prefer to keep our clients through good service rather than locking them in. EE goes against this idea due to the need to take on a long term contract from NBN. This reduces competition overall as customers are locked in to their provider for up to 3 years. There is no opportunity to change provider during that time. 

In many way NBN’s EE is a product of the classical old style telco thinking. We believe we are part of the new style, flexible telco model. A model that allows people to change speeds when they need to, change provider when they need to with a minimum of fuss (within 20 minutes). This is the same model being made available by cloud companies where you can buy computing power by the hour – think Amazon Web Services (AWS). 

If there is one thing Covid-19 has taught us is that it is not enough to have reliable internet in the office, we also need it at home as part of our desire to do more working from home than ever before.

We look forward to NBN making equivalent announcements in the much more flexible NEBS space. These are the investments that are needed to start us down the road of the inevitable FTTP upgrade for Australia.

Damian Ivereigh
Launtel
22nd Sept 2020

Today, for about 4 hours, we saw a major disruption to our voice (telephone call) network. The problem was in the systems of our upstream provider, Vocus. While we don’t have any detailed information of what failed at Vocus, it is already clear that there is a fundamental design flaw in the telephone network of Australia.

During the outage we were able to send outbound calls via an alternate carrier, such that our clients were able to make phone calls without interruption. However we were unable to do this for inbound calls. Unfortunately inbound calls are the calls that most businesses rely on for sales and so this was particularly disruptive. Why were we unable to use an alternate carrier? 

The problem comes down to the mess that our major carriers are in around managing numbers. The basic system is that each carrier announces ahead of time to all the other carriers what numbers it will accept calls for. The process for moving a number between one carrier and another is a ridiculously arduous process called “number porting”, something that often takes days or weeks. So whilst we can send an outbound call via any carrier we like (and just say it comes from xyz number), we have to allocate that same to number to a particular carrier for inbound calls beforehand during the number port process.

You would think there would be some sophisticated protocol (like “SS7”) to do this, however my understanding is that it basically comes down to ad hoc spreadsheets and the file transfer of these between the carriers.

If one of the carriers has a failure there is no method or process for us to quickly tell an alternate carrier to tell all the other carriers to send calls to the alternate carrier instead (and then onto us).

There are only a small number of large carriers that are part of this club that are allowed to send and receive calls to each other. While there are plenty of smaller players, they all have to connect via one of the club members. As you can imagine competition and innovation are rare commodities in this environment.

A good comparison to the issue can be made in the data world with a protocol called BGP. While BGP has its issues, one of the great things about it is that all players (even the smaller ones like us) are allowed to “announce” our addresses (the equivalent of telephone numbers) to the world. We are also allowed to announce via multiple routes, so if one upstream carrier fails another can quickly (in a minute or two) take over, resulting in minimal disruption. Could this technically be done for phone calls, indeed it could – most modern signalling protocols (e.g. SIP that is used by your VoIP phone) can easily handle this.

So unfortunately there really was nothing that we, Launtel, could do about the Vocus outage today. We could choose a different carrier, but in reality all of them will have outages and this is the first system outage they have had in a few years. All providers have to do the same as we do and get their calls through a large provider who is a member of the club.

The one thing we cannot do and the only way to get a fully reliable system, is to use multiple carriers for inbound calls.

Damian Ivereigh
Launtel
15 June 2020