Very good post!

Also note, more and more people are getting disgusted with the telco for all manner of reasons.

And the long term trends look to be an abandonment (by and large) of pots lines. Out here, he's got his cell phone, she's got hers etc. They use wireless internet and cell phones exclusively. No wires at all. It's been pretty interesting to watch it get started.

This is another reason why I just can't get my arms around voip. People don't really need it. 10 years ago? You bet. 10 years from today? I don't see it. Not enough of it to make money at. Especially when you conceder that voip services on everyone else's (including mine) look to be the only way for the average clec to survive now.

(509) 982-2181                                   Equipment sales
(408) 907-6910 (Vonage)                    Consulting services
42846865 (icq)                                    And I run my own wisp! (net meeting)

----- Original Message ----- From: "Rob Kohli" <[EMAIL PROTECTED]>
Sent: Thursday, September 15, 2005 2:15 PM
Subject: RE: [WISP] How to compete (was) 30Mbps for $179/mo

Well said

Robert Kohli
Back Mountain Broadband

-----Original Message-----
Zack Kneisley
Sent: Thursday, September 15, 2005 5:07 PM
Subject: [WISP] How to compete (was) 30Mbps for $179/mo

I read just about every post on the this list, but usually don't have a lot
of time to respond, as I'm sure a lot of WISPS and ISPS do. This topic
brings up a very old subject, and I feel the urge to chime in for the
benefit of my fellow ISPS WISPS friends and competition alike. It sometimes
seems every time we get ahead, we take a step backwards on our ability to be
competitive in their business, although it really all comes down to the
wonderful fees  and taxes we have been paying to the Telco's for years to
build out their infrastructure and help them make their cost of customer
acquisitions easy to write off and go in the hole with, we can still compete
against what seems to be impossible financial odds (what I could do with
even just a couple hundred thousand dollars to spare). We can all still find
a way to benefit from change. Here is an example of one of these challenges
we all face.

Although ads for 30Mbps for $179 seem like the end of our businesses,
thankfully some of the things that the Telco's do, are able to be
capitalized upon, here is just one example of one such change.

Just recently, Verizon Online, mind you, a separate company than Verizon the
ILEC, began to offer their DSL for $14.95 a month.
Because Verizon Online also does have to pay Verizon Telco for the DSL
portion of the connection (notice the automatic referrer on the link, just
type in, I was shocked at this move. Knowing their (Verizon
Online's) price break on the wholesale DSL prices are only slightly better
than our DSL wholesale prices, (5-10% difference because of active circuit
count) I proceeded to check our DSL wholesale prices.

I was amazed to find that our DSL wholesale prices also changed. After
calling our wholesale rep, she confirmed this change. Now, instead of only
making about 12% profit margin (after adding in our required ATM local loop)
on our accounts, we went up to over 100% profit on existing accounts.

Now, yes, this is great news, but in contrast, theses customers now want a
better deal (the ones that pay attention to advertisements anyway) we are
now in the process of moving these customers to wireless to get our profit
margin back and get them on our infrastructure.

Staying on topic, our wholesale agreement also lets us have access to
Verizon's new fiber service, and lets us provide this to our customers as
well. Because our area hasn't had this service built out, and probably won't
for sometime, I haven't seen a request for this service. The only problem
would be that providing bandwidth that this service offers would be
unfeasible because of our current available bandwidth.

Trying not to sound pro-telco, any ISP can contract with Verizon to
wholesale their DSL or fiber service, but you have to provide the bandwidth
and customer support etc. Even though highly integrated, Verizon Online is
just another ISP that wholesales through Verizon Telco, as any ISP in
Verizon ILEC territory can also. They can compete with me only in customer
acquisition costs (going in the hole with a free modem, first 3 months at
19.95 etc.), they still can't and never will with their support and customer

Just to summarize, to be competitive, you have see the whole picture and
realize that with the right business strategy, us as independent WISPS and
ISPS CAN compete with the big boys and still make enough money to employ
locals and support the local economy where we live. No, it doesn't seem fair
sometimes, but nothing in life comes easy if you truly earn it. Hard work,
long hours, heavy thinking and making yourself the janitor and CEO are
needed perquisites to any successful business. We have lower overhead and
can be more efficient than the big boys and can provide better support. This
is what sets us apart, and makes us who we are. We are the local economy.

We are the true backbone of America; we make lives productive, and provide
livelihoods to our neighbors. Embrace change and adjust according, or do
nothing and fail, and fail our friends, employees and neighbors.


WISPCON VIII - Dallas Tx - October 9-11, 2005

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