Telkom profits

[rpm]

Hi guys

If one looks at the amount of profit Telkom is making, as well as the salary packages for their execs, it simply highlights the fact that they have no excuse for not upgrading the service. You can simply not justify such high profits coupled with very bad services.

A good read at http://www.itweb.co.za/sections/financial/2003/0308051119.asp?O=FPT

Regards,

RPM
rpm@myadsl.co.za

[Jerrek]

Well it sure looks like an extremely profitable company...

"However, his was not the largest package. American Anthony Lewis, who quit as CFO in March, received R15.35 million and COO Shawn McKenzie, also American, was paid R10.76 million."

Is that normal? Because it sure ain't normal here. My boss was Vice President for AT&T and I don't think they paid more than $500,000 a year.

[Dangerous]

exactly my point. whenever someone argued with me about adsl being "cheap" (RELATIVE TO DIALUP COSTS) i'de just tell them to
look at their last financial statements.

[SandMan]

Shocking [xx(]

[ASnogarD]

I tried to put up a comment , twisting the story to gain some exposure for this forum, but hit a technical problem 'there was a problem with your feedback' :(

Try add comments to these types of new if the facitlity is available to do so, and add the URL of myadsl while you are at it.

[pdos]

The heart of the problems we experience are not technical at all, they are the consequence of Telkom managerial policy.

Telkom's problem is that ADSL would cannabilise their very profitable diginet service by siphoning off their business customers. So they have instituted restrictions that make it unattractive to business users (3 G cap, timeouts, forced logon every 24 hours, dynamic ip address, restricted international bandwidth).

What we see as problems are actually deliberate policy decisions to discourage business users from migrating from higher cost diginet to ADSL.

Of course this is completely unacceptable and is only possible because they possess an unbreakable microsoftian monopoly. (we can start an off-topic thread on the dictionary definition of microsoftian)

Technical problems they actually try hard to fix. (my experience of their tech support staff has been good) Policy decisions are unlikely to change unless they are subjected to very considerable pressure.

Our problem is to find means of applying that pressure.

[ASnogarD]

I think if Telkom merely lifted the 3 gig limit it would sort out many of the problems, I know I could live with it. The other 'anti-migration measures' will suffice to make ADSL not attractive to current Diginet users - lack of guarenteed speed and dynamic IP is enough to put off high end diginet users.

[thibos]

[}:)]

________________
Hola Seven

[pdos]

A business colleague of mine immediately told me that he could never consider migrating to ADSL because of the 3 G cap.

This is what Telkom intended so I am afraid it is there to stay.

Perhaps a better proposal would be to ask for separate caps on uploads and downloads as well as a higher cap on local traffic which should be metered independently of international traffic.

This would protect their diginet service from significant encroachment while making the ADSL service more acceptable to us.

I understand the emotional need to express our bitterness but finally we need to address this in practical terms that might be more acceptable to the microsoftian monopoly that regulates our communication.

[Merlin2003]

I don't agree with you there. I believe that Telkom's intentions were to roll out a decent ADSL, and that they have factored in the possible migration from leased line and ISDN. The cap was a soft cap to start with, and had things been different, I believe it would have stayed that way. The fundamental aspect of a variable IP would have made the distinction between ADSL and other services. The capping, albeit soft at the time may have contributed to making that disctinction as well.

Many telco's use some form of volume capping in their offering, the actual size of that cap is what's being the issue here. I was told by both Steven White and M_web, that this will change in the future where a tiered volume cap will be offered and priced accordingly. I understand that this may take some time to implement as the complexity to manage individual capping is more than what is currently applied.

However, as we all know, marketing plan looks brilliant on paper and turns out quite different when implemented. I'm not trying to make any excuses here for Telkom, because they are flatly denying that they have screwed up and instead of addressing the problems, they are comming up with 'reasons' why it's so crap and putting certain restrictions in place without due notification.

Following are the reasons:

1) Bandwidth is not guaranteed

This one covers just about any problem we may have and from a legal perspective, we can't do anything about it.

2) 3GB Volume capping

This has been there since inception and again, legally, we have no case

3) International bandwidth is very expensive.

This is used in the same sentence as 1). We should ask them to explain how they derive at this point. How much does it cost? If i look at out premiums compared to other Telco's, we are paying about 4 times as much. Is that not sufficient premium to cover the additional expense of international comms?

4) The server is congested

On this point we could argue that Telkom should be responsible for ensuring that this condition does not occur. Even though they can use 1) to try and get out of it, I still think that any ISP has the responsibility of not overselling their capacity.

5) You have been capped

We all know the result of being capped. Yet, do we know what this condition actually mean? Has Telkom ever explained this to anyone's satisfaction? M-Web has said that the cap will degrade your service to just under 64KBits/second. Bah, that's the normal service.

My belief is that the volume cap is not the major issue, but rather the port capping/deprioritising, congestion, overselling, crappy modems and overall bad service. You already have a solution to your volume cap, get another account. But does it help? NO, because we still sitting with the fundamental problems of the network not being up to it, and Telkom's emergency ruling of applying port capping to get themselves out of this mess.

The reason why I stated up front that Telkom is not doing this deliberately and there are no conspiracy theories, is because they stuffed up big time and it's evident in the way they responded that they did not anticipate these issues up front. That is why they are introducing and changing these restictions ad-hoc without due notification.

History:

Soft volume cap when they launched, not enforced
Volume cap based on international traffic only
Volume cap based on out OR in traffic
Latest - Volume cap on the aggregate of both in and out
Somewhere in between these actions they just threw in port capping/deprioritising.

These are symptoms of a dam springing a leak and Telkom are just patching the holes.

It's called <b>crisis management</b>

What Telkom should have done, and I think the writing was on the wall in early February this year, was to <b>STOP</b>.

<b>NO MORE subscribers until we've solved the network congestion problem without having to apply port prioritisation. That is the point we should be driving at, not capping. You have accepted this service knowing that there was a 3GB cap. It's a non-event, it's not negotiable.</b>

[pdos]

It is always dangerous to argue about someone else's intentions but as it so happens I have had some direct experience of Telkom's intentions. Some years agon I was involved in discussions the then head of Telkom's data services (he is now CEO of a very profitable company)

The dominant thrust of that discussion was at all costs they were going to maintain their monopoly against encroachments from the private sector. Similarly they would not let one service encroach on another, more profitable service. I discovered from that (and subsequent discussions) their corporate culture was one of business success through monopoly maintenance. The very concept of succeeding by competitively offering better products and services seemed alien to them.

Yes, I agree that there are elements within that large organisation who sincerely wish to offer a decent service and I have talked to them. But they are hamstrung by restrictive policy decisions from on high.

You argue that we accepted the service knowing there was a 3 G cap. True, but what alternative was there when confronted by a microsoftian monopolist? And why should we continue to accept it when experience shows it to be inadequate? Why should we not negotiate for a better alternative?

The main thrust of my argument was simply that we should temper our demands to the reality of the situation.

Yes, I agree they are experiencing many problems rolling out the service but I have also been deeply impressed by the promptness, willingness and enthusiasm with which they addressed my problems. At the engineering level they are really trying hard. Given some time and understanding they will solve these problems, learning as they go long.

I must repeat my main assertion, the problem is really one of bad policy decisions at higher levels designed to maintain a microsoftian monopoly.

To the engineering guys at Telkom ADSL I give an unqualified vote of confidence, they are trying to do a good job under difficult circumstances.

[rpm]

Hi Merlin and Pdos

Thanks for the informative postings.

I agree that they are trying to put out fires, but unfortunately all the measures they put in place are against the user. I see from the responses that they are pushing for more accounts to be sold, but this is a joke unless they can guarantee a specific user-to-international bandwidth ratio. If not, it simply means more profit to them and the situation of last weakened, where I had a speed of 5 kbits/s at 2 am in the morning, will deteriorate even further. Logically (and possibly legally) nothing keeps them from making only 1 k international bandwidth available to all the users. This must change. We must have some sort of guarantee. It is clear that Telkom has the money to improve these services…why not do it? I think the answer is that they do not have to. Why not make a killing, show high profits, let the stock climb, and collect those million rand bonuses?

Unfortunately for them ADSL is usually bought by users that are knowledgeable about IT related issues, and are far above average intelligence levels. With this kind of market one has to be more careful ripping them off. It might just cause some problems :-)

Regards,

RPM
rpm@myadsl.co.za

[herbs]

Pretty Std fare in RSA, remeber they do not have to make use of their own services, they plug straight into an intl link or they use their cell phones all day[;)]

[pdos]

I have to agree with you.

One ADSL support guy in CT told me that 25 Mbit international bandwidth was available for 5000 ADSL users.

I can't vouch for these numbers (and don't even know if they are plausible), but, if true, would surely explain the atrocious response time for international access.

I was also assured that they were giving the matter their attention.

So I am hoping, waiting and praying :)

[rpm]

Hi Pdos

I think the number has already exceeded 10 000 users with 25 M international bandwidth. And one must appreciate the fact that many schools and small companies have installed ADSL which means that tens of PC are requesting information from one ‘user account’. No wonder they changed their campaign from ‘super fast’ to ‘always on’. Have you guys noticed that?

Regards,

RPM
rpm@myadsl.co.za

[pdos]

As usual the truth is worse than one suspects. I am well on my way to becoming a depressed, downhearted, despondent cynic. ADSL was meant to bring joy into my life!

[pdos]

But let's look on the positive side of things.
That's 10,000 voices to bring increased pressure to bear on Telkom.
Now how can we get them to be active members of this forum?