More on the ABS Internet Activity Statistics

The old adage referred to in my earlier post on these statistics was the "lies, damned lies and statistics" line. The point being that popularity wasn't just based on subscriber numbers but also on downloads.

The other interesting thing to do is to compare the ABS stats to other data sources.

This release is the first time in a while that the stats have actually given a distribution of all the ISPs by size. The interesting thing is to compare this to the number of service providers that are members of the TIO that claim to be ISPs or TISPs (the latter meaning they provide telephone and Internet services - like Telstra).

The chart below shows that the ABS numbers are well below the total number of merely ISPs let alone those service providers who are either ISPs or TISPs.

The chart might suggest significant under-counting by the ABS. Another comparison we can do is between the ABS fixed broadband number and the total fixed broadband services on either Optus HFC network or Telstra's HFC or copper network. The latter appear in Telstra's results as part of their retail SIOs with HFC, as the fixed BB wholesale, the ULL and the SSS numbers.

The closeness between the two data series is probably not really a good thing as the Telstra+Optus data leaves out Transact and others. But still - the gap is not terribly massive.

Understanding DSL is a little bit harder as you need to estimate how much of Telstra's Fixed BB SIOs are DSL and how many cable. I've used the crude approach of subtracting the Optus HFC number from the ABS total cable and fibre number to get a Telstra retail estimate. The Optus data is their on-net and off-net DSL base. The Telstra and Optus numbers are stacked, the ABS line is their total DSL.

A similar analysis can be done of broadband mobile wireless. Once again the Optus number is stacked on the Telstra one, while the ABS line is total market. The remainder is essentially Vodafone, resellers (except Virgin which is consolidated in the Optus number I believe) and the vividwireless base.

Finally the narrowband data can be compared, as it is below using the same approach.

Adding other providers is problematic as some don't release a lot of data, but I will expand the data set. I might not republish till after the ABS releases the December 2011 data in about April next year.

Novae Meridianae Demetae Dexter delenda est

Open letter to "asmith"

Interesting responses to my itNews column.

The very first response I got was by way of a feedback e-mail (to itNews) from the man at Harvey Norman, Gary Wheelhose, that read;

Hi David
Just a quick note and thanks for the feedback re the presentation last week. It's always good for us to do those events as the feedback afterwards is so valuable. I use social personally for my own service issues - two recent ones with telcos and one with BMW - so I think i know what works for the customer too.
Enjoyed your article and thanks again!
Gary

The comments section on the website scored one from a customer who actually said his provider (one notorious for high TIO stats) was getting better.

This was followed by one from someone in the telco industry. I think the name "asmith" is anonymous but I'm not sure. If it is the author is probably in breach of his own company's media policy. It read

The author of this article knows full well that the numbers reported by the TIO are fictitious and the number of real actual complaints that have any investigation by the TIO is less than 20,000 per annum. Using these numbers to justify the position is a very shaky foundation.

This has been picked up by almost every submission regarding the TIO and ACMA inquiries and also by independent academic research.

Yet for reasons unbeknown to the public but well acquainted within the Telecommunications industry, Mr Havyatt continue to bag Telcos without supporting evidence or true cause.

The new CA code will make things worse for consumers. Amongst many other things, it proposes no service delivery during cooling off periods, etc.

Do you think people want to wait 21 days for their DSL service to be connected?

Come on David, there's two sides to this story, and you know it. The populist route of Telco bashing is wearing thin.

I've placed a long comment on the itNews site. What I want to address here is the accusation that there is some reason why I would want to "bag telcos" - and that that reason would be well known to people in the industry.

I can only think the reason suggested is that I feel I have been thwarted in my more recent career aspirations. This is not only offensive, but just like the comment itself comes from within a heavily filtered world.

I went to the trouble of including the CHOICE presentation, the comment from David Jaffe, and the history of "telespeak" to try to provide some basis for my comments. In my post here I added the link to the submission I made to the ACMA to try to more fully explain why the market alone isn't a solution.

In case "asmith" or anyone else from a telco is listening I'll add to that theoretical piece.

Consumers who are constrained from making the “rational” decision expected of them in theory because of a lack of necessary information are said to exhibit “bounded rationality”. In a recent theoretical work Bounded Rationality and Industrial Organisation, Ran Spiegler modelled a market in which firms were able to induce bounded rationality by “obfuscation”.

His conclusion was that increasing competition (by increasing the number of firms) either retained or increased (depending on other assumptions) the economic surplus retained by the firms. In the best case the firms were making an excess profit of half what a monopolist would obtain.

I really hope "asmith" takes up my offer on itNews and gets in touch with me. I don't think I am engaging in telco bashing - I think instead I'm identifying why the industry solution of "let us compete" is not a sufficient response to those who say "regulate".

Let's be clear I think direct regulation of customer service would be WORSE than what we have. But the industry needs to do something different.

Novae Meridianae Demetae Dexter delenda est

It just doesn't follow

My Friday collection of brief links included one about comments made about the NBN. This elicited a comment from Ian noting he wasn't sure if my reference was sarcasm but that the AFP argument was ludicrous.

For the record, it was, and I agree with the assessment.

But these sort of things abound. Let's also look at the review of the TIO I also mentioned on Friday.

In announcing the review Minister Conroy said;

The recently released TIO statistics show that complaints to the Ombudsman remain at very high levels and this is not acceptable. While I acknowledge the hard work the TIO does to deliver consumers with quick and effective solutions, I want to ensure it has the appropriate tools to deal with complaints.

This got written up by one online journal as;

In a statement, Conroy said he had called for the review, because the number of complaints received by the TIO was unacceptably high.

This doesn't follow. It is at the very least not an accurate description of the Minister's release. If it is a restatement following a discussion, it still doesn't follow.

Why would a high level of utilisation of a service ever imply something wrong with the service? Surely the correct focus is on the providers, as the ACMA is doing with its Reconnecting the Customer project.

Meanwhile Lucy Battersby has done a really good job of looking at the cause and implications of Telstra's move to "per minute" billing.

The item points out that Telstra justified moving fixed line from per second to thirty second blocks two yrars ago to harmonize with mobile billing. But now they are taking both to per minute claiming it puts them in line with "industry standards".

Optus "followed suit" on the per second to thirty second move - claiming the move was to make price comparisons easier.

Telstra goes on to say that of course most customers won't be affected because they are on some kind of bucket plan and don't use the whole bucket.

Unfortunately Chris Zinn from CHOICE decides to hone in on the flagfall charges rather than asking the really obvious question. Since all of the price moves have been justified as simplifying things for customers, including price comparison, why not simply agree an industry standard measure and have everyone stick to it? It really isn't much different to agreeing to measure weight in kilograms and distance in kilometres. Standardisation of units of measure is an important institution that makes markets work!

I know the answer will be about competition and innovation. But it doesn't follow. As the providers own rhetoric shows consumers can't price compare plans using different charging bases.


Novae Meridianae Demetae Dexter delenda est

I told you so ...

Writing in itNews in November I discussed disquiet with the TIO.

I concluded;

It seems abundantly clear that the industry that created the scheme either needs to exercise its responsibility to review it in such a way that all the criticisms are resolved, or the Federal Government will need to include the future of Ombudsman arrangements under its forthcoming Convergence Review.

The Government didn't include it in that review but has today commenced a separate review of the scheme.

This is mighty odd given that the TIO Board has commissioned KPMG to undertake its own - much overdue - review. They just seem to have neglected to tell anybody.

(Note: I was a member of the Board of the TIO from 13 Dec 2000 to 12 Dec 2003).




Novae Meridianae Demetae Dexter delenda est