The key sentence being:
**From 6th August 2012 our standard 9 cent text rate will apply to all 2degrees to 2degrees texts.
Fair enough: 2c is an attractive rate but not really one to make profit on, and 9c is still a good rate anyway. With the continuing massive shift towards Mobile Data and WIFI Offload (where you use wifi instead of the carriers mobile network), the use of Apps to communicate means that texting will be going the way of Voice over the next 3 years.
That you get 300 texts bundled in when you make a $30 topup means that most people will never see a charge for texting anyway.
While the 'topup and get' offer remains, and this is the rub for me.
My grumpy moment comes from how I learned of the change. A tweet, from someone I happened to have connected to. Hardly the most common channel of communication.
2Degrees of course are entitled to make changes; they need to make money after all, and it's covered in their T's and C's:
"Notices and Changes to this Agreement and our Plans
(a) We may change this Agreement and/or vary any Service at any time.
(b) Changes will be published on www.2degreesmobile.co.nz. Please check www.2degreesmobile.co.nz regularly for updates as continuing to use the Services after changes have been published will mean that you agree to this Agreement as amended.
(c) We will give you at least 10 working days prior notice, and where possible we will try and give you 30 days prior notice, if any changes we make materially increase our charges or materially reduce the elements of a Service you are using or change this Agreement so that it has a material detrimental effect on you. We will notify you of these changes by publishing them on www.2degreesmobile.co.nz."
Good on them for stating what their policy is, and how they will do it.
Of course, publishing price changes to the website and classing that as 'giving me notice' is a bit on the nose; if any other service provider like Telecom, Vodafone or TelstraClear, bank, power company or Council took that approach they would feel customer wrath pretty quickly.
I'm guessing there's a bulk email to the customer base coming in the next 5 days (I hope so) from 2Degrees, where they standup and state 'we've changed the price, and it's gone up'. I really hope that 'we published on the website' doesn't become a way of working, because it's a pretty naff way of treating your customer.
I'm fully expecting that the bundle pricing will change again and continue to become less generous; that's a common market strategy (low prices to attract, end the offer and replace with one that's not so good and hope switching inertia does the rest) I've seen and executed before.
The consolidation and change in the NZ telco industry has only just started; more price changes are coming across the board, and not always downward.
EDIT: Forgot to add, I am a 2Degrees subscriber for voice and data, hence my personal interest!
Last week brought the surprise announcement, forced by the power of Twitter (some folks generating themselves some activity) that Vodafone was in talks with Telstra, to acquire TelstraClear. I found the coverage at National Business Review fairly balanced, with the a different take on the move coming from The Dominion Post. I certainly won't forget the events of that Tuesday - confirmation of the many rumours that swirl the industry, combined with interesting timing of calls and texts before and afterwards.
Regardless of what happens, the move signals the beginning of another consolidation round, where the biggest companies move to acquire some of the smaller ones (directly or indirectly in the industry), and so seek to gain some advantage for the next 5 years and make some money. Certainly the ISP landscape has fragmented, and the small ones are busy trying to create ways of standing out from the crowd, although most of the activity is price related rather than much genuine improvement over what's on offer. The most interesting recent move was Maxnet and their "Global Mode" feature, trying to overcome the technology around geolocation preventing users from accessing foreign content, with BBC iPlayer standing out in my mind. That barely got off the ground before being shuttered, and I was left wondering at the overally legality of offering a commercial service that actively assisted in circumventing media rights barriers.. guess we'll never know.
Consolidation happens where a market has too many competitors, and the opportunity for new sales is replaced with one company taking the customer's of the other. The NZ broadband is in this place now, with many players all contesting for the same customer base - there aren't that many new broadband sales to be had - using the levers of price, or increased elements inside a bundle ("$99 for 1TB of Internet data, knock your socks off!!!"). This creates a lot of choice, but as the growth comes from ever decreasing prices, or ever increasing costs for no new revenue - well, something has got to give. Inevitably this leads to Merger & Acquisition, where one company acquires or merges with another, pools it's new resources (technology, infrastructure, people, plant), combines it's increased customer base and seeks to gain new revenue from somewhere else.
I'm often amazed at how much speculation there has been around the future of 2Degrees, and that acquisition is almost certainly it's future - that's a pretty damning pronouncement on the future of a business and the energy that has gone into creating it. Yet fundamentally even the 2D folks know they can't keep spending money indefinetly trying to keep up with Telecom and Vodafone, on pricing that is dropping every 6 months. The cost of new technology is not dropping - it keeps going up - and the cost of your overheads (people, plant, machinery) does'nt go down either.
TelstraClear was born from an earlier amalgam of TelstraSaturn, which was born from Telstra acquiring Saturn. Vodafone acquired iHug a few years ago. Quicksilver was acquired by Woosh. Kordia acquired Orcon. Orcon acquired Bizo. On it goes. For a small country, NZ technology sees a fair share of acquisition and merger activity, and is going to see a lot more in the next 3 years, as the industry grapples with a world where - almost - everybody has to use the same fibre network to deliver voice, internet and entertainment, but where the innovation disappears from the plumbing and is replaced with the quality of the call centre, the capability of the consulting staff, the physical reach of regional offices and local people, and how to generate new revenues to stay in business.
Fundamentally, NZ will still have about 4,5m people. The global economy and the debt levels of the western world will still loom over everything we do. Numpties will continue to operate in whatever government is in charge and create fleeting, media sensation. People will still complain that Internet is too expensive, and that it should be just a monthly charge so they don't have to worry about unexpected big bills - or even regulate their own activity, consuming as much as they possibly can. Big NZ companies will be accused of gouging customers and making too much money. New entrants will enter the market again and seek to undercut the big players, winning a little business by virtue of being someone new and not encumbered with the investments of the past.
And in another 5 years, we will look on in amazement when the next consolidation round occurs.
SILICON VALLEY (The Borowitz Report) – A new social network is about to alter the playing field of the social media world, and it’s called PhoneBook.
According to its creators, who invented the network in their dorm room at Berkeley, PhoneBook is the game-changer that will leave Facebook, Twitter and Foursquare in a cloud of dust.
“With PhoneBook, you have a book that has a list of all your friends in the city, plus everyone else who lives there,” says Danny Fruber, one of PhoneBook’s creators.
“When you want to chat with a friend, you look them up in PhoneBook, and find their unique PhoneBook number,” Fruber explains. “Then you enter that number into your phone and it connects you directly to them.”
Another breakout utility of PhoneBook allows the user to arrange face-to-face meetings with his or her friends at restaurants, bars, and other “places,” as Fruber calls them.
“You will be sitting right across from your friend and seeing them in 3-D,” he said. “It’s like Skype, only without the headset.”
PhoneBook will enable friends to play many games as well, such as charades, cards, and a game Fruber believes will be a breakout: Farm.
“In Farm, you have an actual farm where you raise real crops and livestock,” he says. “It’s hard work, but it’s more fun than Mafia, where you actually get killed.”
Original article posted at Borowitz Report. This guys stuff is funny....
And I added the picture from the latest Simpsons episode, 'How I Wet Your Mother'. Sharp as a sharp thing
For some time now, I've been working through in my mind how the NZ market will change as a result of UFB. In this case, UFB being used as a proxy word for a high-quality, widely available and reliable carriage network for data service - Voice, Video, Internet, Connection - and not the grand project being sponsored by Government. The closest to this definition NZ has had is the TelstraClear cable network in Kapiti, Wellington and Christchurch (not exactly 'widely' available), and to a lesser degree the fibre network FX Networks have been aggressively pushing out until recently (mainly supplied to high value Business and Wholesale customers, with some residential connections).
I've been doing this, because top of my mind is how the service experience will change for all consumers. The old concept of a phone 'master socket' on which sat your telephone, and possibly a broadband connection in another room near the computer, becomes one where everyone will have at least ONE router-like device - complete with detached power brick of a sort - to which your phone and other widgets must connect. I recently wrote an article about this in November, when I had the opportunity to upgrade the electrical wiring in the house, and chose instead to go the wireless route. Much of the comment I got was how useless wireless is for streaming 1080p content, which I find funny as even as recently as 3 years ago it would not have been easy to get even 100mbps around the house before 802.11n came out. For the 100mbps trial I was on last year, equipment was required to go that fast across a wide range of devices.
All of this really got me thinking about the absolutely fundamental role CPE - Premises Equipment - plays in getting a good quality experience. CPE is a jargon term the telco industry uses for the kit you use at your place - either on loan (like T-Box, Sky Box, Cable Modems), sold or given to you (so many DSL modems) or independently purchased (Apple Extreme wifi routers). All have to connect and support what you want to do. It's here that your opinion is ultimately formed on how good or bad something is, and the level of support you get in resolution and stability.
The mobile world has been set alight by Samsung's decision to not release Android 4.0 for anything other than their most recent devices - the Galaxy S2 but not the original - for basic performance reasons. Galaxy S doesn't have the technical chops for the job - but I suspect it's more to do with the burden of future support. For those with long memories, when Apple released iOS4 for the older iPhone 3 and 3GS, the iPhone3 ran so slow it appeared to stop. It was a mistake to release for that device, but I guess folks didn't want to make a large part of the base feel unloved. Unfortunately the software was so rubbish, the base DID feel unloved.
Such is the march of technology - been here before with Windows, where each release requires a machine with 4x the power of what you have now just to look and feel ok. Except of course, for most people a PC isn't that personal, and very few people actually upgrade a PC with a new OS, preferring a new PC - something which is trickier with mobiles, which are usually tied to 2-year carrier contracts.
In a world where fibre comes from Chorus and has uniform performance - and will usually cost from $40/month before performance, CPI and other 'innovations' start increasing the monthly cost - how does a service provider differentiate themselves?
Internet pricing - well, more web things are going 'unmetered', and pricing continues to drop to the point where a monthly price approaches a flat monthly fee.
Voice pricing - how much lower can these get across fixed and mobile? people don't talk much these days - they use the Internet, and so many phones have onboard WIFI that they can auto-switch to your home wireless and not use the pricy 'mobile data' rates.
That leaves what you are going to use these cool new things for. The CPE you attach and your interaction with it and the fundamental importance not only of getting stuff out, but supporting it, debugging it and improving it.
It's what your mobile device will or already connects to via WIFI. It's what your PC, your PS3 or Xbox will connect to, it's where your computer and probably your TV will connect to. The CPE that is your 'gateway' to the world.
Orcon found this out with the 'Genius' - Geekzone has numerous threads of complaint from non-working services, to services working a different way, to disappointment at the kit not being man enough to do more. The noise appears to be going down but it's still happening. TelstraClear T-Box has taken a very long time to go from functional to mostly stable and even then there are random pockets where the experience isn't acceptable. I have no knowledge on Vodafone's 'EasyOffice' - although I expect for some it's been anything but Easy - and for many customers on UCLL in general, they probably aren't getting the best they could (See Mr Biddle's excellent article here). I still see people lodging basic comments on not knowing which type of modem to get for DSL, how to configure basic settings for wireless access as well as locking down the firewall - and it's 2012, 6 years after the NZ broadband market heated up.
CPE support - and how it works with the service providers - has to change, and it has to do so for the whole market. What this means is that support has to cover the ubergeeks - those who rip and replace software on devices with their own (a bit like car enthusiasts changing the engine of a car to get better performance - which means you're off the grid for support), to geeks (those who fiddle at the edges and go for minor enhancements here and there), to disinterested users (the bulk of the country), to completely uninterested users (for example, those still using the CDMA phone they purchased in 2003 and won't upgrade until the network is off.).
Support as the next big thing that will emerge very quickly when the first fibre connections are made, and people suddenly REALLY discover what UFB means.
And I think only Apple is even remotely in a position to be able to talk to the public at large with ready, friendly solutions.
My internet is with TelstraClear, and it comes in downstairs. The network is attached to the house at the corner closest to the street pole. which means I have limited option for upstairs internet service, where the most demand comes from. Today it's served by WIFI, with varying results.
So I had the opportunity to put in high quality wiring from downstairs to upstairs, in that some renovations are going on and the floorboards are up. What better possible time, right?
Except for the quote, which came back at about $1.2k. Seriously. From 2 electricians. 2x 75m CAT6 runs.
I could endeavour to do it myself, but I genuinely don't have the time or the useful tools to achieve that without scrapped knuckles and banged head (time in roof space is required). which forced me to stop and reconsider.
Why do I need this?
$1200 would buy a very nice set of wireless equipment - if I knew what had the best punch/performance and so on. I don't, which means either taking brand risks (Apple's gotta be good, right?) or lots of time googling different kit. The reason I ask is because nearly every widget in the house - except tellingly, my PSTN line and TV services - have wifi built-in. Every 6 months is an improvement in chip performance and technology in market.
Why do I need premises wiring?
UFB is going to bring fibre and powered IAD into everyone's house. As part of my job, I've been thinking through the inhome experience UFB brings, and how to get quality internet out there for all to use. It boils down to 3 simple things:
1. Tidy and effective termination of fibre/iad. Hope Chorus and co spend some of the $1,4bn on on this item!
2. Quality testing and recommendation of high-performance wireless gear for in premises. Caveat Emptor need not be the case - any SP worth their salt should recommend quality over cheap.
3. Services for this modern environment - which means PSTN de-coupled from the line or jackpoint. Sometimes known as VOIP, but giving ME the option to control, not the SP determining a POTS port on an IAD is acceptable.
The technology fraternity 'kindof' gets this - but what's the point if this technology is the preserve of the interested? the elements above need to be ready for the mass market, who don't care about solution elegance but that it works - and technologists frequently forget that when they spout off about something being easy or old tech. If it were easy - your mum could tell you how to do it.
So roll on wireless - roll on the reduction of trailing wiring, of endless house work, in favour of the beauty of the ethereal.. wireless...