BitTorrent is hugely popular but there are a couple of issues for users. The first is the policing of public torrents by agents for the MPAA, RIAA and so forth. Using BitTorrent from one's home computer leads to the possibility of them discovering your identity (through due legal process) and perhaps serving a lawsuit. Private trackers are just as likely to be watched by such companies and add the extra requirement that one maintain a "ratio" - i.e. that you be a good citizen upload as much as you download, since a BitTorrent swarm can only be healthy if someone is uploading.

Enter the seedbox industry.

seedbox.me

These companies will rent you server resources specifically for the purpose of torrenting. They provide high bandwidth so you can more easily maintain your ratios, and anonymity in the sense that infringement notices would first be sent to the hosting provider (most seedbox providers don't own their own infrastructure but rent them from dedicated server providers), who then forward it the seedbox provider, who then chooses what to do with it. I suspect that the typical seedbox provider would not want to put too much effort into investigating the truthfulness of any infringement notices. Seedbox services seem to start around the USD20/month mark, though these are only the purpose built seedboxes. There would be users buying VPS and even dedicated servers expressly for the purpose of torrenting.

Next protocol - NNTP, better known as USENET.

Supernews

USENET is notionally a discussion medium but is primarily (by volume) used to spread large files - movies, TV, music, games, porn etc. An industry of premium USENET providers has sprung up specifically to this end. Users of such services pay around USD10-15 per month for access with the largest players today offer retention of over 500 days. This means that if someone posts an episode of Heroes today it will be available for download until July 2011. The retention rates of these providers is constantly increasing so in reality content will be available even longer.

BitTorrent and USENET are all about downloads. What about streaming? Hulu is apparently huge in the US but I can't view it from sunny Sydney. :(

UK Proxy Server

Enter the VPN industry! Corporate types may be familiar with using VPNs to access their office networks from home, or when travelling. Services such as strongvpn.com and the not so subtly named UK proxy server will sell you VPN access to machines in the US, UK, and many other countries for the purpose of beating those pesky IP restrictions on streaming services. VPN services start around the USD10-15/month mark.

However, despite telling you how you might engage in the growing past time of copyright infringement this post isn't about that. Its about highlighting the fact that pirates are willing to pay for content, just not necessarily to the copyright holders. Keep in mind that underlying all of the above services is basic internet access - in Australia the most popular ISP plans are around the AUD50/month mark, and arguably users on higher usage plans are more than likely not using their extra quota on Linux ISOs.

The question, then, is why do consumers choose to pay these middlemen rather than copyright holders - is it the price, the breadth of content, geo-restrictions, or a straight out desire to stick it to The Man?

There's been plenty said about consumers wanting on-demand (convenient), reasonably priced access to content. Maybe the reason that the major movie, music and TV studios aren't offering what consumers want online is that they own some or all of these side channels. Not.

This time around NBC opted to put their live streams behind a registration wall. You have to be a subscriber of one of the US cable networks, and have an online login to your provider's site in order to sign in to NBCOlympics.com. I poked around at faking a few of these registrations but gave up after a few attempts as most of them seemed to require a bill of some sort. One option that crossed my mind was to pay for someone in the US to have cable installed in order to use the online component of their subscription. To be clear I'm not that interested in the content but more so what's available and the technology. We'll come back to that idea in a sec.

Knowing that BBC has had great online streaming options for some time now I decided to see what they had. BBC are running 6 live streams which covers pretty much everything a regular punter like myself would want to watch. The downside seems to be that the streams are around 400 kbps, not the greatest of quality, but reliable.

eurovisionsports.tv

Eurovisionsports.tv streams to every country in the EU. They provide 12 EBU channels which are what I understand to be raw video feeds from various venues (i.e., no commentary). In addition they also provide access to 48 EU broadcaster feeds so you can stuff from Russia's Sportsbox, Slovakian TV and lots more languages I don't understand. :) Unfortunately I wasn't able to enjoy these streams as my crazy proxy setup was unable to sustain more than 600 kbps so the streams kept rebuffering. They serve these streams via Akamai. For the technically curious, there are 3 steps to their IP restrictions. The eurovisionsports.tv site itself will not serve you the appropriate HTML & viewer, the stream initialization performs another IP check returning XML with some sort of streamID and an authkey, and the stream itself further validates the request IP (it simply returns "closestream" if your IP does not match the authkey).

Getting access to the UK & EU streams was not very difficult. Its possible to buy a GBP5/month shell account and use that as a SOCKS proxy. If you're not familiar with this stuff you can use something like UK proxy server who provide full instructions on using a SOCKS proxy or setting up a VPN.

Finally to my home turf. I was curious what Foxtel are doing wrt online streaming but I am not a Foxtel subscriber. I coughed up $45 for the Olympics pack and added it to a friend's existing Foxtel subscription. The agreement was he watches in his lounge, I watch online. :) This won't work for everyone as it requires the Foxtel subscriber to hand over their username & password.

Foxtel

Foxtel is running 4 channels online, streaming via Akamai. The high quality live streams appear to be somewhere around 1.5Mbps and look pretty damned good. :) There's some initial delay when starting a stream -- it takes around 10s between clicking Play and the stream starting. I suspect this is due to the streams not being overly popular, and therefore the Akamai node I'm hitting (iiNet, my ISP) has to initiate a connection to the source stream.

I was going to look at the Canadian options but so far my Canadian web host has been somewhat slack to setup my account. :) I may update this post later.

Zip was probably the first affordable ISP in Sydney if not all of Australia. They offered an unlimited usage dial-up plan for $25/month starting in 1995. They had something like 16 dialup lines sharing a 64k ISDN connection. Unsurprisingly it was quite congested and it was a huge thing when they upgraded to 128kbps. That got eaten up quickly and they eventually had to install a separate 64kbps pipe just for mail.zip.com.au. Eventually they installed a 256kbps CIR frame-relay link and after that I lost track of the bandwidth upgrades.

Dialling in could be a struggle at times. IIRC they had session limits of 2 hours which might have been raised to 4 hours. Some evenings you'd have your dialler running for half an hour or an hour before you'd get on!

As an ISP Zip was very different to what we experience nowadays. They had an active set of newsgroups, in particular zip.general was full of random banter between the Zip customers. One of the founders was a fellow named John F.A.P.A.X Reid, and they ran a competition to guess that F.A.P.A.X stood for. :) I think the prize was a year's free service. They ran Xmas & birthday parties which ranged from BBQs in the park to taking over Intencity in Parramatta. There was also an IRC channel through which I met many long term friends - today a bunch of us still sit in #zip on a private server, even though none of us are Zip customers any more (if any other old timers are reading this, email me for the server address).

I have saved every piece of email sent & received since I got online in 1995 and came across this: (Kevin Dinn was one of the founders of Zip)

From: Kevin Dinn
Date: Wednesday, June 19, 1996 12:58AM
Subject: Proposal to reduce busy signals

WIth the advent of the new login script we now have the ability to collect statistics on the amount of time individual users have been on. This has allowed us to confirm a suspicion that we have had for some time - that a very small percentage of users are abusing the flat rate system and using much more resources than the average user.

We have discovered some users have been remaining connected virtually contiunously and reconnecting automatically after being disconnected by the limiter. This has had them connected for about 20 hours a day 7 days a week. This is obviously very unfair to all the rest of you users who are sticking to the Zip philosophy of using Zip only while you have useful stuff to do on it, otherwise disconnecting to let someone else have a go.

This probably explains the fact that we are now getting busy signals on our lines from mid-day sometimes even though we are currently only at a 10 to 1 user to modem ratio.

We have been trying to think of a reasonable solution to this and have come up with a proposal we would like to hear comment on. We would like to impose a time limit on the flat rate account. This limit would be massive and only affect the abusers, not the reasonable users, of the system. The number we have in mind is 150 hours a month. This equates to about 5 hours a day 7 days a week or about 8 hours a day 5 days a week. We think this is a reasonable limit and if you need more than this then you should be looking at paying for a permanent connection. By our calculations, only 30 of our current 900 users use more than this amount. After the limit was reached there would be an hourly rate charge of $2 to $3 (not determined yet).

Please let us know whether you think this is an outrageous imposition of your liberties as a flat rate account holder. As I said, the object is to reduce the busy signals for everyone by limiting the activities of a selfish minority.

Its kinda funny how many times we've seen this same situation play out since with ADSL usage plans.

I struggled with the the 150 hour usage plan but fortunately Zip introduced a $50/month unlimited plan as a beta. I seem to recall this had 8 hour session limits which were eventually removed and I managed to stay connected for a whole week once. :) The remarkable thing about that was that Windows 95 didn't crash for a whole week!

Zip eventually merged with another small ISP called World Reach to form Zip World which was in turn sold to Pacific Internet in June 1999. It seems that PI wasn't (and isn't) really interested in retail as their home plans haven't ever been competitive and I ended up signing up to Optus@Home cable in May of 2000.

It started off as an unlimited usage plan which eventually morphed into having a "NetStats" limit of 10x the average usage. i.e. if you exceeded 10x the average usage over a rolling 14 day period you'd be disconnected. I got disconnected once, paid the penalty, then eventually switched to ADSL as that became more widely available.

So anyway after almost 15 years I've finally closed my gumby@zip.com.au account. I had a look at its webmail and the account was filled up by spam back in 2006 (it has a 60MB limit, in 2010!).

A bunch of Zipsters now run Bulletproof Networks which I believe is one of the best managed web hosts in Aus. I wonder where other Zipsters have ended up...

What triggered this post was an anecdote from one of the commentators, about how when they were kids they would wait for months after a competition like The Eddie to see the results & photos published in a magazine. Today every pro surf event is streamed live on the net.

As I sit at my desk I'm blogging via a server in Atlanta, Georgia, USA, streaming live video from from Hawaii, talking to friends in Melbourne & all over Sydney, receiving almost real-time stock prices from a datacentre 25km away, and backing up my important documents & photos to a server in New York. If I chose to bring up Yahoo! Messenger or Skype I could talk in real-time to any of the several hundred people I know spread all over the world, at almost no cost.

My desktop (see the notes on Flickr)

My business is almost entirely virtual with the two partners meeting in person no more than once a week, yet we are in communication almost 24x7. Our source code & intranet lives in multiple locations including Washington, USA, and I'm not even sure where our email lives nowadays except that it's somewhere in the US.

15 years ago I would have had, at best, access to regular stock price updates via a phone broker or teletext. Most likely I would have relied on a newspaper to publish the daily closing prices. Talking to anyone overseas on the phone was seen, at least in my family, as an expensive special occasion only activity. Almost none of the technology we rely on today to run the business existed 15 years ago. In fact our whole industry didn't even exist 15 years ago. :)

Its pretty fucking amazing how far we've come. But its still early days as I'm still waiting for my hoverboard.

Keep in mind this is from the perspective of a very small startup with absolutely no buying power so I hope this is useful to other small companies who may be after basic HTTP delivery (i.e. serving static objects like JS/CSS/images, as opposed to streaming video).

Besides price, features such as geographical footprint, gzip and the ability to set appropriate cache control headers are likely to be key factors in CDN vendor selection. Not every business needs global coverage and there are some CDNs which only cover US & Europe which may be more economical. Some CDN providers explicitly charge more for Asia coverage (including Oceania).

Points 6 & 7, regarding the support model & transparency of status. If you're a very small customer you're more than likely going to end up buying CDN services through a reseller as very few CDNs will sell direct at small volume. In this case you need to understand exactly how support issues will be escalated - are you able to open tickets directly with the underlying CDN vendor, or do you have to escalate through your reseller's NOC?

If you follow point 4 and compare speeds from various locations you will more than likely discover irregularities in every CDN network. You might want to use that data to open a conversation with the CDN provider to establish how responsive their NOC/support is as you don't want to find out during a real outage that the promised support is non-responsive.

In actual experience we discovered regional nodes that were down for hours (and not failed out of rotation), as well as nodes with consistently poor performance, and even nodes that were "in production" but never in rotation (resulting in no local presence for that region). I won't name names as these may well have been corrected but I should say that as we're currently using EdgeCast (via a reseller) that these issues were *not* seen on EdgeCast.

The good news for small CDN customers is that there's an increasing number of CDN services available on a PAYG basis. EdgeCast is available via GoGrid CDN, HighWinds via VPS.NET, Internap via SoftLayer, and LimeLight via RackSpace Cloud (though this is lacking Origin Pull). This is not meant to be an exhaustive list, nor any sort of endorsement, but just a few off the top of my head that have published PAYG pricing. You can find a complete list here but keep in mind that a significant number of CDN providers focus on delivering video and it can be quite an arduous process to whittle down suitable options.

As I see it the problem boils down to folks not having specific & up-to-date domain knowledge. Whilst its fun in some cases to read a bunch of review sites & blogs and learn about all of the factors relevant to your purchase of a camera or a new laptop, its not practical nor necessarily enjoyable to do that for every purchase you'll ever make.

Hunch could help to solve this problem as it allows users to essentially build expert systems. Users can build decision trees that guide other users through a series of questions before arriving at some conclusion. e.g. if you're buying a camera it might ask you what your budget is, how important size & weight are to you, etc.

However there are two problems I see with using Hunch for this purpose. The first is trust - I don't know if the users creating Q&A are actually knowledgeable in the specific fields. Obviously this makes their recommendations questionable. Secondly even if they are experts I don't know whether they're in a position to keep their knowledge & recommendations up to date. For something like a camera or a laptop this is pretty important given how frequently new products appear.

Both issues are solvable - users already go to specific review sites like Digital Photography Review. They trust DPReview know how to evaluate camera performance, and as they're constantly posting reviews they know that the folks behind it are up to date.

What's missing is a simple way to digest all of their reviews into purchasing advice. DPReview has a buying guide but it is essentially a feature search which isn't all that useful if you're not already knowledgeable about how the features affect usage, nor does it factor in their own reviews of actual performance.

To give another example a question I am regularly asked is "What ISP should I use?". I'll usually recommend a few ISP plans based on my understanding of how many GBs/month they're likely to use, what they intend to use it for, and available service in their location. For someone who's big on gaming and/or cares a lot about speed & performance I'm going to recommend premium ISPs such as Internode or iiNet, whereas someone who doesn't care so much about their pings & speed or reliability but cares more about value for money I would recommend to Exetel or TPG.

This stems from my understanding of how these ISPs run their networks through direct experience and the experiences of technical friends that I trust, as well as knowing people who work in said companies. There are aspects of the service beyond price such as redundancy & performance that are not immediately obvious to the average consumer but with just a few questions & knowledge of the industry one can reduce over 200 ISPs & several thousand plans to just a few options worth considering.

It would be awesome if someone were to offer a Hunch like service as a white label / embeddable service. Sites like DPReview could use it to build a friendlier filtering mechanism which asks the appropriate questions, then whittles the myriad of brand & model choices down to just a handful of realistic options, factoring in their review data.

Interviews with Girl Talk, Danger Mouse, dudes from the MPAA & IFPI, and The Pirate Bay, as well as Lawrence Lessig (Creative Commons). And some interesting and amusing sections on the Nigerian movie industry (Nollywood!) and Brazil's Tecno Brega scene. If you have any interest in culture & the influence of copyright its worth the 58 minutes.

FWIW I donated 5 EUR after watching it. :)

I was looking at the sugar industry today for investment purposes (ok, I'm procrastinating fixing an annoying bug ;). Its not an industry I know anything about so I found it interesting that Bundaberg Sugar and Bundy Rum are both foreign owned.

Bundaberg Sugar was sold first to Tate & Lyle PLC (the makers of Splenda amongst other products) in 1991, and then to Finasucre (a Belgian company with global sugar investments) in 2000.

Bundy Rum is now owned by Diageo, the world's largest beer, wine & spirits producer. They own well known brands such as Guinness, Johnnie Walker, Baileys and many others.

Both still operate in Australia so at least they still employ locals.

Fans of Bundaberg Ginger Beer will be happy that its still Aussie owned ... at least as far as I can tell. :) Its brewed by Bundaberg Brewed Drinks Pty Ltd.

The Bureau of Infrastructure, Transport, and Regional Economics collates on time performance statistics for the Australian domestic market. As with all statistics the correctness of the data is a little questionable (Qantas and JetStar submit flight stats via ACARS whilst the others submit their own mix of hand-recorded data) but its all we've got.

The definitions are as follows:

A flight departure/arrival is counted as "on time" if it departs the gate within 15 minutes of the scheduled departure/arrival time shown in the carriers' schedule. Neither diverted nor cancelled flights count as on time.

A flight is regarded as a cancellation if it is cancelled or rescheduled less than 7 days prior to its scheduled departure time.

The cynic in me would logically conclude that once a flight is delayed beyond its 15 minute buffer the airline should totally burn the flight to maintain the on time performance of same sector flights since the metric does not account for total time delay, just whether the flight is delayed or not.

Eyeballing the (PDF warning) August & September 2009 stats it isn't immediately clear that any of the airlines are better or worse for the Sydney<->Melbourne route. Flight arrival delays vary between 72.9% and 83.3%, and cancellations reach as high as 5.8%. Qantas and Virgin Blue appear to be the best performers on this sector though it should be noted that Jetstar is not fairly represented since they fly mostly into Avalon (which isn't anywhere near Melbourne so I guess it is fair in that respect :).

At an aggregate level (i.e. across all sectors) Qantas and Virgin Blue appear to be the picks for best overall on time arrival performance. Virgin Blue has historically had a poorer cancellation record but as the difference is just 1% I would caution reading too much into the aggregate figures since performance can vary quite greatly by sector.

In relation to my experience yesterday with Tiger Airways I think one important factor is the number of flights each airline is running on each sector. Qantas & Virgin Blue are each running over 800 flights in each direction on the Sydney<->Melbourne route, compared to around 120 flights for Tiger Airways. Assuming they all run similar loads it would seem that Qantas & Virgin Blue would more likely have capacity to absorb passenger loads caused by a mechanical failure or other incident.

Overall it seems to me that as a budget holidayer doing Sydney<->Melbourne I'd be best off trying to pick up a special on Qantas or Virgin Blue. Looking 3 Saturdays out from now there are sub-$100 tickets on both. I'd only consider Tiger or Jetstar if their tickets were under $50 and their flight times were better suited to my schedule.

To start with, announce the options available to would be passengers on your cancelled flights - don't make them stand in line for hours just to find out they have to fill in some forms. For your delayed flights - announce accurate information about re-scheduled flights. When you tell your passengers that their flight is delayed for 3 hours then 2 hours later you tell them it'll be another 3 hours, its hard to know what to believe. The academic reference here is the story of the boy who cried wolf.

Now the whole story ...

I was scheduled on Tiger Airways 2pm flight from Melbourne to Sydney today. Checked in just after 1pm as they are apparently quite strict about their 45 minute cut-off. There was a bit of a line up but it moved quickly with 4-5 check-in desks open, no dramas. We began boarding just after 1:30pm and I was quite impressed by the efficiency of it all - it looked like we were going to take off dead on 2pm.

Now I had heard several stories of appalling Tiger Airways travel experiences so I was, at this point, pleasantly surprised that we appeared to be taking off on-time with absolutely no incidents. At 1:50pm the captain announced there were engine issues which they hoped would be resolved by a "reset". I have to say as a computer guy its a little worrying that they are hoping to resolve an issue with an aircraft engine with a . Anyway we were to be off in 10 minutes, sweet!

Just after 2pm we see the ground staff start wheeling the staircase towards the plane ... the staircase we'd used to board the craft. Uh oh. We're told that the reset had failed and we were being re-scheduled to take off in 2-3 hours. Ok, whatever, mechanical failures happen.

I find a power point and setup the laptop & 3G USB dongle and start poking around for on-time performance statistics to try and get an understanding of how frequent these issues are - I'll post about that tomorrow.

It is announced that our flight will be re-scheduled for 4pm takeoff. Then its 5pm. Then 5.30pm. And finally 8pm. When the announcement of the 8pm takeoff occurs there is an almighty groan from the now full-to-the-brim terminal. They also announce that we'll get meal vouchers for our trouble - woo!

Now as they have re-scheduled my flight 4 times now, and I've become aware that Tiger only operates 7 aircraft in Australia and I don't see them magically producing spare planes any time soon I opt to start investigating alternatives. I end up buying a Qantas fare for their 7:45pm flight which is how I eventually got home.

After I'd sorted out my Qantas ticket and checked-in I re-visited the Tiger terminal. It is 6.15pm and there would've been several hundred people packed into the check-in area. You see Tiger had opted to cancel their 6:45pm and 8pm flights in order to accommodate the stranded 2pm and 3pm flights' customers. But I guess they didn't have time to notify any of these customers, say by SMS, so there's maybe 300 irate customers trying to figure out what a cancelled evening flight means exactly.

Out of interest I decide to line up to collect my meal voucher, and also to see if there is a way to "un-checkin" from my now 8pm scheduled flight. I stood in queue for 45 minutes watching the poor Tiger ground staff explain to each customer that their options were a) to accept a full refund of their ticket price, OR b) to accept re-imbursement for overnight accommodation and re-scheduling onto a Monday flight.

These options aren't rocket science so I can't understand why they didn't just announce them. In the 45 minutes I was there I heard it explained at least 10 times to individual customers, but not one public announcement. Tiger process fail.

When I got my meal voucher I discover its for $5. And its only valid at the cafe inside the departure lounge so I would have to go through the security check for the 3rd time this arvo to claim my $5 prize. LOL :D I opted for a souvenir instead.

The same staff member who awarded my meal voucher explained that I had to physically be at the check-in desk to un-checkin. I wasn't willing to un-checkin at 7pm just in case my alternate Qantas flight also ran into troubles so I do apologise to all the passengers in Terminal 4 who had to hear my name read out 30 times before TT674 finally took off. I tried to avoid it but Tiger doesn't like to make anything easy, apparently.

All in all it was a very interesting experience for someone who really enjoys understanding how systems work. The parallels with systems failures in other industries such as IT/web are uncanny. The lack of spare capacity available to Tiger was not apparent to me and I discovered it in the same manner a web user would when a highly trafficked website falls over because of a server failure. Keeping spare capacity costs and that aspect of a quality service is usually not appreciated until an incident occurs.

PS: I'm really not suggesting that everyone should avoid Tiger Airways. Tiger has an important role to play as a budget airline in generating competition in the domestic airline market. It's also important for customers to recognise that cheap isn't everything - there are quality factors which are not always immediately apparent which may be worth considering.

Many of the books shared common themes around organisation, accountability, hiring & firing rigorously, identifying values & fostering culture around that, as well as the usual discussions around product, marketing, sales & overall business strategy.

Of all the books I have read, none have been as succinct as How To Castrate A Bull by Dave Hitz. Dave is one of the founders of NetApp and talks through the different stages of NetApp's life and the importance of context in relation to business strategy & management.

Notice how the strategy keeps flipping, from broad to narrow to broad. As an early start-up, you think broadly about what problems you can solve. After you've gained experience with some early customers, you choose just one group to focus on -- a very narrow strategy. After you've succeeded there and have more resources to invest, you broaden out again.

"Don't cross the street by yourself," you tell your four-year-old son, but a few years later you say, "It's okay to cross the street by yourself." It's not that the early strategy was wrong and then you fixed it; the point is that different stages of development require different strategies, and often the appropriate strategy at one stage is the opposite of the strategy for the previous stage.

This recognition is important when it's time to drive change through an organization. People often resist change, and I think part of the resistance comes from a feeling that if it's necessary to do something different, then they must have been doing something wrong before. People don't like to admit that they were wrong. Never mind worrying whether things were all screwed up before -- it's much healthier to focus on what strategy is best for now.

At just 175 pages How To Castrate A Bull provides great time economy. Dave condenses topics that fill entire chapters in other texts to just a handful of pages, yet conveys his message clearly by providing solid examples from NetApp's history.

Thanks to Joz & Kat for getting it for me for my birthday, my first ever present from my Amazon wishlist. =D

It cost $20.10 to send it back to Queensland via Registered Post including insurance for the full $950 with a minimum delivery time of 3 days and no online tracking. Yet when the vendor sent it to me, it cost them $12 via Australian Air Express which delivered it overnight, and provided online tracking.

I called AAE to find out if it were feasible to use their services as an individual and the response was that I'd be wanting to send at least one parcel a week to make it economical.

Australia Post has its Express Post Platinum service which does offer online tracking but doesn't offer the option of purchasing extra insurance.

Does anyone know if there is a consumer oriented postal/courier service that can offer quick-ish delivery times, online tracking & optional insurance at a reasonable price?

It seems there's a gap between the Express Post services + Registered Post delivery times & lack of tracking.

PIPE has a history of shaking things up in the Aussie telco industry. The average tech consumer may know of them for their peering exchanges but just as significant, if not more so, is their dark fibre network. This is used by ISPs to connect their various DSLAM networks, meaning that if you're an iiNet, Internode or TPG user (think ADSL2+) you're more than likely traversing some PIPE fibre somewhere. (Its probably true of many other ISPs too, these are just 3 of the larger ISPs that come to mind when I think of owned & operated DSLAM networks.)

In a 2005 iiNet presentation there's a breakdown of the cost difference between using Telstra's DSL network and iiNet rolling their own:

Those costs roughly hold true to today. Here's an excerpt from from Slide 14 of iiNet's 2009 annual presentation.

The gross cost is essentially iiNet's cost to connect a customer to their network which would include fees paid to Telstra for access to their copper network & exchanges, as well as the cost of linking each exchange back to their core network (via services like PIPE's dark fibre).

That little bit of background was to illustrate PIPE's effect on the Australian ISP industry thus far -- they've helped to move the cost of a 1.5 Mbps service @ $55/month to something 10-15x faster at a cost of $20/month.

With the PPC-1 project they are having a similarly large impact on the other component of internet service - transmission to/from the broader (global) internet.

Less than two weeks ago Southern Cross Cables announced price drops on their services.

Prices for circuits to the US, from both Australia and New Zealand, have just been reduced by 15% bringing reductions over the last 18 months to more than 50%. "These reductions are made possible by our ongoing implementation of cost effective capacity expansions and that's great for high speed broadband".

Of course their price drops were entirely due to their improved efficiencies and little to do with PPC-1 coming online. =)

What this all means for the average internet consumer is increased value in internet plans over time. I use the term "value" here rather than "savings" as its unlikely that users will see a direct decrease in their internet costs but more than likely there will be increases in quotas offered at each price point, and for some of the less performant ISPs you should see better performance as they can now afford to buy more capacity. ;)

For example I was subscribed to RSYNCpalace.com's New York 100GB plan at $16.95/month and if you go to their front page right now they're offering a 15% discount to new customers for the life of the account. I emailed them and they applied the discount to my existing account, though they also stated that they don't normally do this.

As another example I have subscribed to a premium USENET service for $15/month for the past 2 years only to discover today that they offer the same service at $10/month to new customers only. I've obviously cancelled my account and will sign up again with a different name next month.

I can understand why businesses do this since the vast majority of their customers will never discover the specials, and of the small number who do an even smaller number will actually leave in a fit of rage. Upon discovering the special prices they're more likely to just re-sign up since they can now get the service they're already used to at a lower price, just as I did.

The question that's been gnawing at my brain is what could be a better model?

I guess the goals are, in a nutshell:

1. reduce churn: existing customers should feel they are valued and have a reduced incentive to shop around
2. pricing model should have flexibility to attract new customers without counteracting goal #1

If a company has setup fees they could waive these. No detriment to existing customers who have already paid their dues, and a small incentive for new customers to sign up right now. However when the company's services is heavily commoditised as it is for USENET services, and there are no setup fees, what incentives could be offered to new customers without making existing users feel like they are being gouged?

I've tossed around the idea that existing customers could be given discounts based on tenure, i.e. maybe after 6 months you get an ongoing 5% discount, rising to 10% after a year. That helps to discourage existing users from leaving but doesn't help to entice new customers to sign up. You could perhaps offer new customers their first month at a discount, reverting to the usual discount schedule after month one. But my gut says this is violating the KISS principle for little overall gain.

Then again, pricing model complexity is exactly what all of the telcos & banks have opted for so maybe bashing customers into confusion is the way to go.

Anyone have any bright ideas?

I called 13 24 84, went through the IVR menus, and thankfully wasn't put on hold. The rep verified my identity using my full name, DOB, a single recent transaction on the account (note the ease with which one could provide these details if my account were indeed already compromised), and a secret question.

The rep claimed that Citibank had reason to believe that my card data had been swiped and used to produce replica cards. I find that hard to believe given that I've very rarely actually used the physical card with most transactions being online. But whatever.

Fail #2 - Although the rep was unable to provide details on exactly why they believe my account had been compromised Citibank was going ahead with blocking & cancelling the current account, and re-issuing a new card + number. This is really inconvenient given the number of auto-direct-debits I have setup and that the new card would not arrive for 7-10 days. I asked if there were particular merchants they considered risky but she could only say that "the system as a whole has identified your account as possibly compromised". Useless.

She did however question if I recognised two transactions - one from GoDaddy and another from PayPal, neither of which should look suspicious given the frequency of transactions from those "merchants" on my account, none of which I have ever raised issue with.

Fail sub-total - 17 minutes on the phone, no card to use for a week, and when the new card arrives I have to go and update a bunch of billing accounts. And no reason to believe that my card was actually compromised, nor that they won't call me again a week from now to say that I'll be re-issued with yet another card.

My gut says that either their own systems were compromised, or one of the merchant systems were compromised, and they are unwilling to share the truth.