Should you be restructuring your telecommunications?

Should you be restructuring your communications?

A month or so I decided to bite the bullet and fix my family and (small) business telecommunications.   I thought I’d outline what I did here and follow it with some reflections which I’m hoping to research further.   Currently they’re not particularly well informed.   But everyone has to start somewhere!

My telecommunications needs are a bit complicated.   David Maouf and various other literati might spend four months a year in Tuscany, but I spend a tad short of three months a year in Canberra and the rest of the time in Melbourne.   The family moves to Canberra where all our kids surviving grandparents live during school holidays.   It all works very well and I can conduct all my work activities via phone and e-mail from my Mum’s dining room table.

Mum’s house is on a farm out past Hall ACT. Far enough away from an exchange to make ADSL unavailable but within sight of the Black Mountain tower.   So wireless broadband seemed like the best option. I picked a package which was pretty pricey – $59.95 per month for one Gig of traffic a month at 512K from Telstra (Telstra counts the traffic both ways which tends to halve its apparent value compared with packages that only meter downloads).   ‘Unwired’ doesn’t go to Canberra and so their slightly lower prices weren’t an option.

However there were benefits to net out of the total cost. First was a 50% discount for the first year of the contract for various relatively innocuous tie ins with Telstra.   They also cut the price of the modem I think it was from $230 to $130.   In addition we could do without one of the lines we’d put in, so the net cost was pretty low, with huge improvement in service.

Back in Melbourne we had two phone lines through Telstra and our long distance calls through an obscure long distance carrier – Zintel which also provides 1300 numbers for the business and has good service and cheap rates.   One of the lines had an additional number on it (you can tell it’s ringing from a funny ring). So I knew which business the call was from.   There was an answering machine on each line and a separate number to which the additional number was diverted to provide an answering service when unattended or otherwise engaged.     So apart from our mobiles which I’ll leave out of this, we had two lines out and three lines in.

We’re now paying less than half the cost of all this but have three lines out and three lines in.   We have one Telstra line into the house with a 1.5 Meg ADSL service from TPG attached.   In exchange for paying monthly rental on a second telephone line – nearly $30 a month I think, we paid an additional $10 per month for a VoIP server and another $199 for a VoIP router from TPG.   That router has two VoIP jacks coming out of it.   So in addition to the Telstra line in and out there are two VoIP lines out on which we ring most numbers in Australia for an unlimited time for 9.9 cents a call. International calls are also very cheap. Remember you don’t need to leave your computer on.   The router is the only thing that stays on.   It’s your conduit to the outside world. The phones we use are normal phones, now not plugged into the wall, but into the back of the router.
Meanwhile the router also has four network ports and a WiFi aerial.     I use one of the network ports for my computer and the WiFi aerial seems to work for multiple computers. We’ve run two simultaneously along with my own computer attached to the router by cable, and VoIP calls running at the same time. I expect more would run, but I don’t know.

I kind of knew that WiFi was available on the router, but had bought some WiFi stuff before and backed off when I couldn’t install it easily I took it back to the shop.   In this case it was all pretty daunting, but ultimately easy to set up once an hour or so was set aside and I rang TPG’s techos who won’t tell you where they are, but have Filipino accents and laugh when you ask what the weather is like in Manilla.

Why am I telling you all this?   Well I find it of some interest and maybe I can induce you to reduce your telecommunications costs with VoIP which is not quite as good as the normal phone network, but pretty damn close most of the time. (And when it’s not you just call back on the normal line).

But I’ve now got ‘hands on’ experience of the ease with which bandwidth can be converted into multiple phone lines and the incredible convenience of WiFi. My daughter and son now do their research surfing the net lying on the couch I can ‘search inside the book’ on Amazon in my armchair in my lounge.   Much better than sitting at attention at my desk.

When tuning my WiFi, I discovered around five other WiFi networks within range – some unsecured.   Our own network was unsecured for a couple of weeks and some free riding probably got done on our download limit, but we’ve got plenty of excess capacity there, so no damage was done. I’ve now ‘secured’ the network so the risks of free riding blowing our download limit have been largely removed in the future.

But get this!   If our ADSL capacity is enough to handle three computers and a couple of phone calls at the same time and currently not use more than about 4 Gigs a month then we could provide all the telecommunications needs of four or five neighbours, perhaps ten at zero marginal cost.   (If VoIP works on 256 K ADSL then 1.5 Meg will run six VoIP lines simultaneously which, if they were set up a la a PABX would provide the funtionality for more than six telephone lines (provided they weren’t all used at once).
We’re currently paid up for around 25 Gigs per month. We’re not yet on ADSL 2 but when we are, speed rises by a factor of about 16 and download limits quadrouple for a doubling of cost – to $130 – would purchase 100 Gigs per month or four times what we have now.

So with the right hardware and software, we could supply maybe 40 local houses with free telephony once they’d bought WiFi compatible systems and that’s just from existing retail offerings of TPG. Our neighbours could by-pass the local loop completely as they would be connected to our router with WiFi.   If this were a new block of flats Telstra would (I think) Charge something like $170 to connect any local loop and perhaps it’s more to install it, less than the typical cost of a VoIP router – though we paid a little more.

Our VoIP supplier (TPG) doesn’t provide us with VoIP numbers for incoming calls incomming calls are all to one of our Telstra numbers.   That creates an incoming call bottle neck. If someone has rung on one of our lines and we’re on the Telstra line, anyone else ringing in gets diverted to an answering machine.   However it doesn’t happen much because we ring out on the VoIP lines.

But I went with TPG for convenience and because they only lock us in for 6 months.   If I’m not happy with this arrangement, other VoIP suppliers like Engin enable you to rent a VoIP incoming call number from your favourite capital city.   (Peach Home Loans’ General Manager is now able to give Brisbane clients, a Brisbane number to ring which makes a difference commercially, even though he doesn’t even live in Queensland. But I digress).

All of which leads me to wonder if we shouldn’t be trying to use these possibilities to really slash the cost of telecommunications for many homes.   There’s a lot of talk about ‘distributed’ power generation in electricity the idea that today’s consumers (households) may end up being exporters to the grid at least during the daytime, as they pump solar energy as electricity from their roofs painted with low cost paints converting some of the sunlight into electricity.

In telecommunications, blocks of flats and self organising body corporates could build WiFi networks which would be utilised by locals at costs far lower than they currently pay.

In fact Australia already has a well developed nationwide WiFi network the mobile phone network.   But it seems that the technology it uses is more suited to larger more centralised investment than WiFi and judging from the prices in what is a relatively competitive industry, it seems like a much more expensive technology (Still the price of SMS is a joke which I imagine has virtually nothing to do with marginal cost). Likewise wireless broadband.

But WiFi that seems to have very different economics sufficiently so that whole townships are being set up to provide their inhabitants with free WiFi access. Like Milton Keynes in the UK and Fredericton in Canada. I don’t know if telephones have been introduced to these systems yet, but the latter article makes clear what seems obvious – that there shouldn’t be a problem in doing so.
I’d welcome anyone’s thoughts on any of this.   If I’m wrong where am I wrong?   If I’m right why hasn’t what I’m suggesting happened? I think the answer to this is partly inertia, partly the difficulty that we have in making technical progress when whole systems need to be changed.   (It is for instance ridiculous that most houses are not built with some kind of network perhaps a WiFi one in which lights, burglar alarms and central heating and cooling are integrated so that lights and air conditioning turn on when you go into rooms and off when you leave them for any length of time.

But in the absence of the product being widespread, there’s little demand for it, and in the absence of the demand for it it isn’t widespread.   But it would save money, resources etc.   (I’m not necessarily recommending intervention here by the way, though I expect a government ‘strategy’ or two without any regulation wouldn’t go astray.)

The other part of the answer is that I’m pretty sure some of the incumbent broadband suppliers supply it on condition that broadband capacity is not ‘on-sold’ like this.   If that’s the case there may be a case for access regulation. And it was stupid to sell Telstra at least in the form that we did.

But none of this seems to be a very satisfying answer to why nothing much is happening.   Couldn’t a smallish telco put in the instrastructure to supply developments of blocks of flats with WiFi telecommunications packages?   Wouldn’t a low cost housing trust want to do it for housing commission flats?   Wouldn’t a charity like the Brotherhood of St Lawrence try to get collectives together to do this and agitate if there were institutional obstacles.

I’d be interested in your thoughts.