Re: [nznog] CloudFlare Peering Blog

Mobile in Australia is an oligarchy. Since the collapse of ISPone there seems to be an active effort being put in by the 3 mobile carriers (Telstra, Optus, VHA) to protect their margins and make it as difficult as possible for MVNOs to start up. Prepaid plans should not be that expensive - I have had worse experiences in Germany. Your home Internet is a different story. The caps exist to support the limited resource. Unlimited has been tried and is always abused. The wholesale access charges within Australia require ISP's set limits or it's the same as everyone leaving their taps running and lights on. Cloudflare's experience with Australian bandwidth pricing will be related to the costs charged by the tier 1 carriers (Optus, Telstra and AAPT [note: AAPT may have started peering; I am a little out of the game there now]). They will be seeking direct access to eyeballs and being charged for the privilege, much the same as the issues Netflix is facing with eyeball carriers in the USA. On the cost front, the underlying delivery cost for some of these networks is higher, as they try to keep consistent pricing across all regions of Australia. People in small towns pay the same prices as people in the largest cities. The country is big and the population density is low. Contrast that to Europe, and carriers there have a much easier time making money. Despite all of this, negotiating peering (paid or otherwise) in Europe with their incumbent carriers is just as difficult and costly as in Australia :) - unless you are Cloudflare-size and have hit that critical mass of outbound content that makes you attractive to these incumbents. Macca On Mon, Nov 3, 2014 at 8:04 PM, Petri Ojala wrote:

We spend our winter in Sydney. While not directly related to the carrier bandwidth costs, my mobile charges will triple and broadband internet cost will be seven fold.

In addition to the increased costs the services will be slower and I’m getting data caps, which I don’t have in Europe. The offerings are crippled by mandatory landlines, 24-month contracts and various other requirements and fees. While one can get Telstra Cable without a minimum contract, it comes with a mandatory landline that has penalties if terminated too early. I won’t even go into details about the customer experience getting the broadband..

I think it tells a story if CloudFare pays the same amount for Australia as they do for all of Europe. I was actually thinking about buying Telstra stock simply because it’s de-facto monopoly in the country and not much light at the other end of the tunnel.

Petri

On 3 November 2014 at 10:14:21, McDonald Richards ( mcdonald.richards(a)gmail.com) wrote:

Keep in mind that this refers to "Benchmark pricing" with $10 being the benchmark for the USA.

Do your own math and draw conclusions from that extrapolation :)

Macca

On Mon, Nov 3, 2014 at 7:47 AM, Dean Pemberton wrote:

...

Interesting article from CloudFlare...

http://blog.cloudflare.com/the-relative-cost-of-bandwidth-around-the-world/

While NZ isn't mentioned I'm picking we get lumped in with Australia for which they have this to say...

"Australia

Australia is the most expensive region in which we operate, but for an interesting reason. We peer with virtually every ISP in the region except one: Telstra. Telstra, which controls approximately 50% of the market, and was traditionally the monopoly telecom provider, charges some of the highest transit pricing in the world — 20x the benchmark ($200/Mbps). Given that we are able to peer approximately half of our traffic, the effective bandwidth benchmark price is $100/Mbps.

To give you some sense of how out-of-whack Australia is, at CloudFlare we pay about as much every month for bandwidth to serve all of Europe as we do to for Australia. That’s in spite of the fact that approximately 33x the number of people live in Europe (750 million) versus Australia (22 million).

If Australians wonder why Internet and many other services are more expensive in their country than anywhere else in the world they need only look to Telstra. What's interesting is that Telstra maintains their high pricing even if only delivering traffic inside the country. Given that Australia is one large land mass with relatively concentrated population centers, it's difficult to justify the pricing based on anything other than Telstra's market power. In regions like North America where there is increasing consolidation of networks, Australia's experience with Telstra provides a cautionary tale." _______________________________________________ NZNOG mailing list NZNOG(a)list.waikato.ac.nz http://list.waikato.ac.nz/mailman/listinfo/nznog

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