Web Intact
Well-Known Member
OK - this is to erase some of the words that have been put in my mouth, dispel the myths that have propagated from that, and also to try and explain why our original business model is beginning to fail, leading to capping:
Myth #1:
People who complain get throttled
Not so - anyone 3Gb over their associated package (what they pay and the new packages) have been throttled.
Myth #2:
GWI Gauteng splits the Local/International traffic between IS & Verizon
Nope - only P2P is sent via IS, all the rest is through Verizon.
Myth #3:
GWI has been expanding while not making a profit = zero business sense
Part 1: A warped summarisation of the info I have supplied here. In a nutshell, there was a certain amount of cash available in the beginning to build the network. If we didn't expand, we couldn't grow the client base. If we didn't grow the client base, we wouldn't have been able to expand - chicken & egg... It didn't materialise suddenly - money had to be put in, and that money is long gone.
Part 2:
Our upstream provider was originally IS, and we ran all areas off aggregated ADSL lines through IS' uncapped service enabling us to resell uncapped. The quality & reliability was not very good, and we chopped & changed between a few upstream ISP's without ever really improving matters. Eventually we changed to Verizon, at a much higher price per Mb, but still sold the uncapped service. As the network grew, we connected more areas directly to the Verizon backbone.
As word of the improved quality spread, more & more people started taking up the uncapped service and hammering it like there was no tomorrow...
We could have run like that for a long time with the light users subsidising the heavy users, but eventually that house of cards started collapsing, and the subsidised users eventually closed the gap with their excessive consumption, forcing us to slow that down by implimenting the capped service.
Myth #4:
GWI is capping their clients so they can squeeze as much profit out of their clients as possible.
GWI should take a leaf out of companies in the USA's book and learn how to make a profit from uncapped services
It's kind of true in a way, except that it's not just to maximise profit and fill our pockets, but rather to get back to a profit-making business. As i mentioned, the heavy users on the Verizon backbone have turned the slim margin we made on VZN to a negative one.
Comparing broadband companies in the USA to SA is nuts - it's common knowledge in SA that the broadband food chain begins with and is defined by Telkom, unless you want to use satellite like IS and live with the high latency and lower reliability.
Telkom's stake in the undersea cable enables them to set the price that dictates the pricing to the end users. It's out of anyone's control to change that right now, and models of light users subsidising heavy users are the only way to get cheap prices, as long as the light users way outnumber the heavy users...
Myth #5:
I have also heard that only about 2% of the subscribers use more than 3gb a month. Correct me if im wrong.
Again the result of broken telephone relaying of information...
I did state here a few pages back that 2% of the subscribers used 40% of the bandwidth... the math problem put forward makes a bit of sense, but it's still the main cost to GWI that's causing us to slip into the red...
Hope this info helps a little... you know I'll be back, so keep posting as you do....
Myth #1:
People who complain get throttled
Not so - anyone 3Gb over their associated package (what they pay and the new packages) have been throttled.
Myth #2:
GWI Gauteng splits the Local/International traffic between IS & Verizon
Nope - only P2P is sent via IS, all the rest is through Verizon.
Myth #3:
GWI has been expanding while not making a profit = zero business sense
Part 1: A warped summarisation of the info I have supplied here. In a nutshell, there was a certain amount of cash available in the beginning to build the network. If we didn't expand, we couldn't grow the client base. If we didn't grow the client base, we wouldn't have been able to expand - chicken & egg... It didn't materialise suddenly - money had to be put in, and that money is long gone.
Part 2:
Our upstream provider was originally IS, and we ran all areas off aggregated ADSL lines through IS' uncapped service enabling us to resell uncapped. The quality & reliability was not very good, and we chopped & changed between a few upstream ISP's without ever really improving matters. Eventually we changed to Verizon, at a much higher price per Mb, but still sold the uncapped service. As the network grew, we connected more areas directly to the Verizon backbone.
As word of the improved quality spread, more & more people started taking up the uncapped service and hammering it like there was no tomorrow...
We could have run like that for a long time with the light users subsidising the heavy users, but eventually that house of cards started collapsing, and the subsidised users eventually closed the gap with their excessive consumption, forcing us to slow that down by implimenting the capped service.
Myth #4:
GWI is capping their clients so they can squeeze as much profit out of their clients as possible.
GWI should take a leaf out of companies in the USA's book and learn how to make a profit from uncapped services
It's kind of true in a way, except that it's not just to maximise profit and fill our pockets, but rather to get back to a profit-making business. As i mentioned, the heavy users on the Verizon backbone have turned the slim margin we made on VZN to a negative one.
Comparing broadband companies in the USA to SA is nuts - it's common knowledge in SA that the broadband food chain begins with and is defined by Telkom, unless you want to use satellite like IS and live with the high latency and lower reliability.
Telkom's stake in the undersea cable enables them to set the price that dictates the pricing to the end users. It's out of anyone's control to change that right now, and models of light users subsidising heavy users are the only way to get cheap prices, as long as the light users way outnumber the heavy users...
Myth #5:
I have also heard that only about 2% of the subscribers use more than 3gb a month. Correct me if im wrong.
Again the result of broken telephone relaying of information...
I did state here a few pages back that 2% of the subscribers used 40% of the bandwidth... the math problem put forward makes a bit of sense, but it's still the main cost to GWI that's causing us to slip into the red...
Hope this info helps a little... you know I'll be back, so keep posting as you do....
Last edited:
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@ daffy - I like your sense of humour!