Internode Increase Prices, Twice

Internode BannerI use Internode as my current Internet Service Provider, they have been reliable, cost effective and I have not had a single complaint. The day before yesterday they announced that there would be changes to their plans and pricing structure. I now have a complaint.

There has not been an increase or major changes to their offerings since I have been with Internode. Indeed there has not been a price increase for six years. I can appreciate that these things change and inevitably prices always increase. However in this instance it is the percentage of increase and the way in which they have gone about it that sticks in my neck.

The reasons that have been given for the price increases are that while offered line speeds have increase, the cost of provision has not decreased. In other words users have faster speeds, download more and the cost of providing that bandwidth has increased. Internode blame the heavy use of services such as YouTube and BitTorrent for this. I am not sure what they expected users to do. These services especially video are only really available to those on faster connections!  Therefore they have hit the high speed users more than the lower end plans. I presume they use the above for justification for this. They are the ones using the bandwidth so lets charge them the most.

So the price goes up. Which as far as I am concerned is fine. I can understand that if something costs more then you need to essentially cover that cost. For me this means an added cost of about $10 AU to my bill per month. Currently I am on 8000MB/384kB connection with a limit of 20 Gig down per month. I can cop the 10 bucks on the chin. But essentially I have been delt a double blow. My bandwidth has been halved to 10 Gig per month for the same price that I am paying now. The cost to increase to my current 20 Gig limit once the changes are in effect? 10 Bucks… Do you see it? This is not a 10 dollar increase, it is a 20 dollar increase. Because that is what it will cost to maintain my current service.

This was underhanded in my opinion. If you are going to increase my plan by 20 bucks then bloody say that. Don’t halve my service! Don’t tell me that most users don’t use their limit and don’t soften it by saying that you are offering 13 new plans to better suit my budget! This is a massive increase in cost to the end user both in bandwidth and cost. I assumed that maybe it would be 5 – 10 dollars per month, I was very wrong. Internode will loose customers having done this and there are a lot that are not happy. As the Whirlpool Forums, in which users have vented their displeasure is a testament to. There are those defending them as well but more that are trying to wrap their head around exactly what Internode were thinking.

As I said Internode are excellent, I don’t have a complaint about their service. Am I leaving? No, not for the moment, but I am looking at alternatives.

With the advent of the connected world, the increase demands of bandwidth for applications and web development with software technologies such as Ajax, Java and Flash, podcasting, on-line video and gaming this was inevitable. People are using the technology, they are utilizing that which the online universe has presented to them. They are using more bandwidth, they are consuming more resources. It was not like you could not see it coming. But this is only the beginning. The Internet is being programed for users that have the bandwidth to run it, not the other way around. In my opinion the thought that if you give users a faster speed they won’t actually consume more bandwidth was an oversight. Then to slug users that are using these services with a large increase and cripple their ability to use them due to reduced bandwidth limits was wrong.

I am not impressed Internode, at your lack of foresight, your logic, your increase in price and your reduction in my service. But as I said I have been happy with your service and I will give you but few chances and no, you are not a cat and there goes one…

Internode Homepage Screenshot


Could Skype Crush the Telco’s?

SkypeAs you would probably realise I have been away for a few days. I was blown away by the news that Skype has applied for a patient that indicates that it might in the future offer free calls to any phone worldwide for free!

The patient has not received much publicity to this point, mainly because the call from objectors has not been made. That happens on the 1st of August. Prepare for war, that date is looming. The Patient’s title is “The Whole World Can Talk for Free”. Yes that’s been their slogan for a long time. But I refer to Russell Shaw’s reply:

Yes, of course I know Skype has been using this phrase in their marketing for a year now, and it appears on their home page. But why go to the point of registering it.. now? Is this basically a butt-cover to forestall similar phraseology from competitors who Skype fears may underprice them, or are there larger forces at work?

This is huge. We may be in the first stages of a major restructuring of the global communications market. That is to say nothing about the impact that this will or may have in Australia. In Australia we are ripped off supremely for phone calls and access. In addition to that we pay twice when we phone a landline using Skype; we pay for the broadband access, we pay for the call. Admittedly I would have payed for the broadband anyway but in my opinion this is a double dip.

One thing that may or may not be happening in other countries is that the major Telco in Australia (Telstra) charges everyone an access fee to a landline. Not so strange you say. What about the fact that if I choose not have a phone line and just use VoIP for my calls via my broadband connection; I still need to have a landline in order to get the broadband! So Telstra charge me for access to the line that I have to have then I have to pay for my Internet connection on top of that then I have to pay for my Skype calls to landlines and mobiles on top of that! See my point. So how might this rumour affect me should this prediction come true?

I could see the major Telstra off-setting the loss of revenue with an increased charge for access. Not only that they will charge like a wounded bull for the ignorant few that are left with no knowledge of Skype. So based on that I am not sure how this one will resolve. I am crossing my fingers…

For those of you that might doubt the power of the Skype marketing engine. Just remember that Skype have been offering free outbound calls in America for the last couple of months, what is there stopping them from extending this globally. With the right business model of course. In addition I think an inclined to agree with Shaw in that to take advantage of this you will probably have to make some form of financial commitment to some service that Skype offers. Still that given I think that it will beat the Telco’s hands down as far as value for money. We will no longer be held to ransom by these companies that insist on ripping us off blind!

In summary though I see trouble on the horizon for Telecommunication Companies that will need to drastically revise their business model in order to stay in the game. If they are not scared now they should be, this was always coming and it is on our doorstep now. I will be very interested to see what happens on the 1st of August. I am thinking that there will be a long list of objectors.

Of course this is all speculation but time will tell.