Are you asking why we aren't offering 20Mb?
If so, the answer is simple: We've had no call for it, to date.
If we were getting regular requests for it, we would develop the product and offer it.
No two ISPs determine their pricing in the same way. We run a very lean business with no fat and offer clients fibre connectivity at very low contention ratios for decent prices. Other companies that have major overheads - or who are locked into draconian bandwidth contracts - have to to reflect that in their prices.
Imagine if you will company A buys raw IP from Gateway at R4K per Mb delivered to the company's network rack in Teraco. They have all their servers (they are small so the servers were about R500K to be amortised over 2 years so depreciation per month is +/-R21K - if the servers are being leased, cost would be about R60K per month) at Teraco and pay Teraco R10K per month for the rack. They then need to get the IP out of there into their wireless network and pay R5k per antenna on the roof per month. They have a 17GHz link over the road that cost them R70K to install. It's being amortised over 2 years, so that's +/-R3K a month in depreciation. From Teraco they bounce over the road to the tall building next to Newlands. Another R10K for a couple of antennas, more radios, more depreciaton (I'm sure you get the idea by now). From there the signal bounces here, there and everywhere. Fortunately, the more remote the site, the cheaper the rental, so they would only end up paying about R1700 a month by the time they get to Simonsberg. All those costs need to be added into the ISP's cost price per Mb. Suddenly that 1Mb that's costing R4K at Teraco might cost R6K at Simonsberg or Helderberg. Let's say the contention ratio is 5:1, so the contended cost price will then be R1200 per Mb. Let's say the ISP makes a gross profit of 35%. His retail price may then be R1620 per Mb. Imagine how that would change if the ISP were buying IP at R1K per Mb instead of R4K per Mb. The more bandwidth you purchase, the cheaper it becomes.
Imagine if you will company B buys raw IP from AfricaINX at R1.5K per Mb delivered to the meet me room in Teraco. They are a flash bunch have all their servers in a data centre in the CBD and pay Dark Fibre Africa R5 per meter per month for fibre to their data centre. They then need to get the IP out of the data centre into their wireless network and pay stupid amounts per antenna per month in the CBD. From there they bounce here, there and everywhere again. Of course this lot have an image to keep up, so it's expensive office rental, huge monthly car payments, expense accounts etc.
Company C may have spent capital on a data centre in the suburbs and may have taken the hit and run their own fibre back to Teraco. Their business model would be different to A and B.
These are just two and a bit scenarios. There are as many scenarios as there are companies offering wireless services.
I've not only answered all your question, but also provided you with a small insight into the industry. Would you mind answering my question and telling all of us who the WISP is who ISP # 5 is ?
If so, the answer is simple: We've had no call for it, to date.
If we were getting regular requests for it, we would develop the product and offer it.
No two ISPs determine their pricing in the same way. We run a very lean business with no fat and offer clients fibre connectivity at very low contention ratios for decent prices. Other companies that have major overheads - or who are locked into draconian bandwidth contracts - have to to reflect that in their prices.
Imagine if you will company A buys raw IP from Gateway at R4K per Mb delivered to the company's network rack in Teraco. They have all their servers (they are small so the servers were about R500K to be amortised over 2 years so depreciation per month is +/-R21K - if the servers are being leased, cost would be about R60K per month) at Teraco and pay Teraco R10K per month for the rack. They then need to get the IP out of there into their wireless network and pay R5k per antenna on the roof per month. They have a 17GHz link over the road that cost them R70K to install. It's being amortised over 2 years, so that's +/-R3K a month in depreciation. From Teraco they bounce over the road to the tall building next to Newlands. Another R10K for a couple of antennas, more radios, more depreciaton (I'm sure you get the idea by now). From there the signal bounces here, there and everywhere. Fortunately, the more remote the site, the cheaper the rental, so they would only end up paying about R1700 a month by the time they get to Simonsberg. All those costs need to be added into the ISP's cost price per Mb. Suddenly that 1Mb that's costing R4K at Teraco might cost R6K at Simonsberg or Helderberg. Let's say the contention ratio is 5:1, so the contended cost price will then be R1200 per Mb. Let's say the ISP makes a gross profit of 35%. His retail price may then be R1620 per Mb. Imagine how that would change if the ISP were buying IP at R1K per Mb instead of R4K per Mb. The more bandwidth you purchase, the cheaper it becomes.
Imagine if you will company B buys raw IP from AfricaINX at R1.5K per Mb delivered to the meet me room in Teraco. They are a flash bunch have all their servers in a data centre in the CBD and pay Dark Fibre Africa R5 per meter per month for fibre to their data centre. They then need to get the IP out of the data centre into their wireless network and pay stupid amounts per antenna per month in the CBD. From there they bounce here, there and everywhere again. Of course this lot have an image to keep up, so it's expensive office rental, huge monthly car payments, expense accounts etc.
Company C may have spent capital on a data centre in the suburbs and may have taken the hit and run their own fibre back to Teraco. Their business model would be different to A and B.
These are just two and a bit scenarios. There are as many scenarios as there are companies offering wireless services.
I've not only answered all your question, but also provided you with a small insight into the industry. Would you mind answering my question and telling all of us who the WISP is who ISP # 5 is ?
