But a small (for now) start-up is taking on the Big 5 .
Ottawa Gal, who recently brought p2pnet readers news of the Bell Sympatico P2P Black List, came across TekSavvy, founded in 1998, while she was working on her story. So she thought it’d be a good idea to have a word or two with TekSavvy president and CEO Rocky Gaudrault.
Says Ottawa Gal:
“IMHO, this is definitely something for Canadians to look at as a reasonable alternate internet service provider whose business plan, business ethics, and pricing plans includes customer input for their long term survival,” going on:
“I’ve been following many topics in the DSLreports Teksavvy forum, and in it I found some issues that raises eye-brows in relation to what Bell-Sympatico is doing to its users and how it affects Teksavvy. So it seemed logical to approach them with this Q&A.” >>>
Ottawa Gal: What got you into the ISP business?
Rocky: We started as a Internet Development firm and due to the ups and downs of the development world tried to find alternative means of income that would stabilize the monthly income. In came DSL!
Ottawa Gal: How is the business doing, and is it what you expected?
Rocky: We’re doing very well. Through our efforts, we’ve been in Bell’s top performers list and have been ranked as North America’s top on DSLReports Good-bad-ugly board for some time now. As far as expectations, it’s hard to say as the business plan we’d developed with DSL in it predicted much of this growth. Hehehe. However, I was gunning much higher than expected! Didn’t think we’d actually hit the mark!
Ottawa Gal: What do they think about file sharing and file sharers?
‘Rocky: This is a loaded question. From an ISP perspective it’s a loose, loose. You have people who download/exchange for the right reasons; the problem is with those who don’t. What you have to consider is data has a finite cost, so someone downloading movies for free. Well, not quite. We’re actually paying for it in the end. To add insult to injury we then have to spend on the HR needed to receive and pass on copyright infringements and such. In Canada they currently have no leg to stand on, so as far as due diligence, we simply figure out who the individual is and pass the message on.
Ottawa Gal: Do you or will you ever cap, throttle or impose a limit on ‘unlimited’ accounts?
Rocky: We don’t plan to remove unlimited accounts but have just recently put plans to correct the high downloading as of the New Year. The pay per play strategy will have to become a more mainstream reality as, with people understanding how to exchange files and also with the increase in both streaming and online activities/speeds. You can’t help but have a correction.
Ottawa Gal: Bell-Sympatico forced you to remove the log-in only accounts. What do you think of this? Will they come back? Will you fight this?
Rocky: Bell Sympatico didn’t specifically/officially force our hand on this. The discussion came about with a few of the Bell management and the end result was to hold off on the login-only services we know how Sympatico will deal with abusive accounts. Our goal, in the end, isn’t to harm Bell, and if the login does so, we’ll pull it and work with them to reinstate it with mutually acceptable conditions. In the end, all DSL wholesalers are part of the Bell family in some shape or form as, if it weren’t for them, the consumer would not even have an option! The cable companies have made it abundantly clear that they’ll resist things to the end on letting others in. They’ve placed a rate template for wholesalers, through the CRTC, that doesn’t make sense, so DSL is the only way.
Ottawa Gal: Yes, I have seen the Cable tariffs on the CRTC’s web site. It’s an outrageous cost. They are pricing out any competition and making sure there is no competition on their cable via whole-sellers. Would this have been an avenue that you would have reviewed from a business standpoint? Do you foresee the CRTC ever doing anything about these costs in the near future?
Rocky: If there CRTC would have made it a viable option, yes, we would have looked at it very seriously. It would be nice to offer options to the client base but, unfortunately, as it stands, it’s not feasible just yet. One can only assume the CRTC will only sit by so long before they force changes as it’s not much of an option right now. The only option currently that makes financial sense is to resell them (we’d make 25% on each account), but then we’d have no control over the quality or much of the policies. Which is something we’re not willing to hand over?
Ottawa Gal: To what extent will the larger Telco, Bell-Sympatico, go to prevent access to their customers they deem ‘Network Abusers’? Will they go as far as to not activate them on the Dslam, hence preventing any other whole-seller from servicing them? Or will they just ban them from their own Sympatico service?
Rocky: The current/version 1 of this attempt at biting back has been to stop their service and remove them from the WTN (Working Telephone Number) List. From there they’ve also removed their address from the qualification database. As it stands they’ve taken a hard line to stop and give themselves a change to think about what they want to do next. On the flip side, their current thoughts have been, if these people are abusive on us, they’ll be abuse on all the DSL providers, so in their minds, they’re doing us a favour, and for what it’s worth, there is a little worth to this, as they will for sure cost whoever they go to next!
What Bell might not consider is the potential value of that customer as far as a referral or ally. Many of these heavier users are often tech heads that gladly help others and in many cases will be first to refer or spread the good word about performing or worth ISPs.
What’s happening is users of Sympatico that are abusive are getting their network access shut off but through login service with us and other ISPs they’re getting back online.’ ‘Bell is now fighting back by trying to find means to shut that address off completely.
So with ‘finding any means’ to shut a user off completely, including if that means refusing you, as the competition, to service them, how does this affect you? What do you think of Bell-Sympatico dictating to you whom you can and can’t offer DSL services to?
Rocky: The plan on this is to work with Bell (see the last half of #6). They’re trying to come up with various solutions to allow both Bell and wholesalers (which shouldn’t be seen as competitors. A Bell sale or a wholesale sale, is still Bell income) to work together on protecting both network and non-abusers from having to deal with abusive users. Those who go beyond the levels of reasonable. The question however remains on that level, what is reasonable? From the looks of it they’ve placed that mark to be somewhere between 200GB and 300GB (we still don’t have the official word, but on DSLR these seems to be the general consensus).
Ottawa Gal: Do you plan on fighting what is forced upon you?
Rocky: Not sure just yet. As mentioned above, we’ve made this far and been successful for various reasons unrelated to Bell, but one things for sure, we couldn’t have been here without their allowing us in! We’re not big on legal anythings and, to date, have always been able to work things out with Bell. We don’t expect this to change. They’re all a bunch of great people working there. The problem is it’s somewhat of a dysfunctional family of sorts (left hand/right hand). We suspect the retail side took a stance without considering the wholesale side (which is often the case).
Ottawa Gal: I have also noticed your user base to be very militant in their support for you, the little guy (like the militant Mac users vs. Dos machine users). How do you react to this?
Rocky: Hehehe. We have an awesome client base! We’ve gone out of our way to try and bring on savvy employees to be able to talk shop with anyone of our clients, knowledgeable or not, so with DSLR being as tech savvy as they come (no pun intended), we grew to interact and work them. There’s no greater group to both my brother and I than the DSLR gang! They let us know when things are or aren’t working. We respect one another and as a result both owners feel very comfortable spending their time there. It’s productive for both Marc and I to hear what the techs want and grouped the constructive criticisms allows us to draw happy mediums on just about everything!
Ottawa Gal: Would you attribute this strong client base to your openness? I mean, every change or idea you have you seem to post it online for all to see and comment on. Do you see this as a contributing factor? I have never seen an ISP do this, and to show their business direction prior to implementation.
Rocky: I think it definitely doesn’t hurt anything. As much as many people treat business as a type of poker game (don’t show your cards), if you do it well enough so that copying you becomes very difficult, then showing your cards isn’t all that big a deal. In order to copy us, you almost have to literally be us. What shines through on TekSavvy is our personality, so even if someone tries to ride our coattail, if they don’t have the same personality, they won’t get the same results. We’re genuine in everything we do, so it makes it easy to discuss things. You don’t have to worry about what you said from one person to the next!
Ottawa Gal: You apparently have the best pricing so far in Quebec and Ontario. Do you foresee almost doubling the cost as the big Telco’s are doing?
Rocky: These questions come just ahead of a few changes coming in the New Year. In order to keep with the new speeds and usage (also heavy users), the unlimited side will get a significant increase, but the Premium side will as a response become much more flexible. So long as we take it in paces and allow the pricing to go in line with the usage, there won’t be a doubling of prices. We’re unique in what/how we do business as we’ve designed a two tiered system, a Premium/Capped and an Unlimited network. We’ve just recently changed from a 100GB cap to now a much more favorable 200GB and changed the per overage rate to $0.25 (completely unheard of in the industry) with a $10/100GB block usage. This will allow the Premium network to grow with the usage and remove much of the larger bandwidth speed issues. On the flip side we’re changing the Unlimited by increasing it by $10/month.
We’re now changing the mentality of how we do things. Instead of having both networks exists separately, we’re now making them work together for the client. Unless you know for sure that you will use more than 300GB/month, you go premium, which is a much better network and one that has better long term viability.
Ottawa Gal: What areas do you service, and is there a cost differences in servicing these area’s?
Rocky: We currently service Ontario, Quebec, Alberta and British Columbia. ON/QC is serviced through Bell and AB/BC is serviced through Telus. With the help of our friends at Peer1, they’ve managed to create a solution that’s made our transit almost the same in either Province. There are however some pricing differences between the two incumbent (Bell/Telus) territories. Bell has a 256K and 5Meg residential product that we’re selling, while Telus has a 3Meg and 6Meg product.
Ottawa Gal: I see you now service B.C. and Alberta, how do you find it working with another big Telco? Is it more or less the same as dealing with Bell-Sympatico?
Rocky: We don’t actually deal with Bell Sympatico. We deal with the Bell Carrier Services Group of Bell. They’re mandate and roles are completely independent of the Retail (Sympatico) side. In fact, the better we do, the more secure their jobs are, so oddly enough, they want us to beat one and all (including Sympatico in some cases).
There are some pretty major differences at present time between both Bell and Telus when it comes to wholesale DSL You can tell Telus just recently opened the doors to competition as much of the automated functions and procedures that we currently enjoy with Bell aren’t there just yet with Telus.
Ottawa Gal: Any future expansion plans? If so, where?
Rocky: We’re in the middle of finalizing options for possibly heading out to the East Coast currently, so don’t be surprised to see us out there before next summer! From there the debate is do we do the prairies or not . Both MTS and SaskTel pricing aren’t very favorable at the moment.
Ottawa Gal: As an ISP, can you give us some insight into the headaches you experience with the big Telco’s?
Rocky: LOL. Glad you didn’t ask our Tech Support Manager that question! The problem with monopolies is, if you want to play, you play on their terms. As a result, services like DSL have MTTRs of 48hrs, which sometimes gets pushed or reset, sometimes causing 3 or 4 day delays for repairs. We also sometimes don’t get all the maintenance notices, so certain geographies or Central Office might go down, through no control or knowledge of our own. We’re almost never down so considering we’re dealing with 80 to 100 bell tickets at any given time during the day, we’re spending a great deal of HR just for Bell.
Ottawa Gal: I see that you are active daily and at all hours of the day in your forum. Do you ever sleep at all <grin>?
Rocky: Hehehehe. My wife forces me to plug into the wall once a week!
Ottawa Gal: Can the CRTC or Industry Canada mediate or be involved with what Bell-Sympatico is forcing upon you?
Rocky: I’m sure they can, but it will require ISPs to complain. On this particular topic. Would they want to? You complain or sue Bell for essentially protecting you against abusers. You win your battle, spend a lot of money to have to keep paying money after you get the abusive client as they become negative income for having them. :-/
Ottawa Gal: What do you think of the fact that Canada has no regulatory body overseeing ISP’s?
Rocky: Hmm Not sure I’d say that. The CRTC and Competition Tribunal are both working together to try and make things fair for one and all.
Ottawa Gal: Do you think that Bell Canada having ‘five members of the panel, three are current or past directors or employees of Bell, including panel chair, former BCE CEO and Chair Lynton (Red) Wilson’, sitting on the panel (http://mhgoldberg.com/blog/ and http://www.ic.gc.ca/epic/site/cprp-gepmc.nsf/en/h_00001e.html) Canadian competitiveness consultation) of the Competition Policy Review Panel is fair? Do you think this is too much influence towards one single company?
Rocky: I’m assuming this is the same as the TPR (Telecom Policy Review), if not, you have a similar issue there. Problem with Bell is there everywhere. Who can you find that will both understand the industry but not have enough exposure to have been touched by them? The only thing we can do is hold them accountable for their actions.
Ottawa Gal: Many Sympatico and non-Sympatico users are saying this is an abuse and injustice with what Bell is pulling here. What are your thoughts?
Rocky: I’m ignorant of what Sympatico’s currently done to get to this point (shutting people off). If they’ve simply, out of the blue, just turned them off, then I’d say it was of poor taste. As far as what I’ve read so far, they’ve sent letters to notify those who were deemed to be abusive to tell them to lower their usage or be shut off. In trying to keep with Rogers/Videotron/etc. with the increase in speeds came the issue of sufficient backbone coverage in various geographies. Not an easy task to calculate when you’ve tripled the speeds.
Ottawa Gal: Do you think this throttle or invisible download cap by bell at any time of the day may have been influenced by the American industry and lobby groups (ie. RIAA, MPAA and so forth)?
Rocky: No clue. Everything I’ve seen to date with Bell would hint no, as it’s about dollars and cents and if the investors see a bottom-line issue, that’s where they’ll go, and the bottom line would be on the data (a finite cost), not what the RIAA or MPAA think. Again, this is a guess.
Ottawa Gal: How do you think this impacts progress of Internet in Canada?
I think this isn’t all that bad. What you have to consider is, all these countries that are throwing up higher speeds are also putting in blind or soft caps to protect themselves, and as a result ticking off clients. At one point or another Broadband internet will have to align itself with the cost of Data, otherwise there will always be this yoyo game.
Ottawa Gal: How do you react to ‘Network Abusers’ jumping ship from Sympatico to Teksavvy? Is it really too much of a burden to carry them?
Rocky: Believe this has been touched on a few questions up. In brief, we’d just recently adjusted both rates and caps to allow these individuals in and to allow us both (TSI and new/current customers) to grow together.
Ottawa Gal: How do you feel about this ‘David versus Goliath’ ISP issue unfolding, and how do you think the market will react to this?
Rocky: Hehehe. That’s a funny analogy. In this case, David is working with Goliath to make things feasible for both to exist. No stone throwing!
Ottawa Gal: In relation to Dr Michael Geist‘s topic, ‘The Impact of Music Downloads and P2P File-Sharing on the Purchase of Music: A Study for Industry Canada stated it’s a ‘loose-loose’ scenario on an individual basis, but later on you stated that these tend to be the tech savvy users who may bring significant revenue to off-set the costs as a whole (ref: ‘What Bell might not consider is the potential value of that customer as far as a referral or ally. Many of these heavier users are often tech heads that gladly help others and in many cases will be first to refer or spread the good word about performing or worth ISPs.’.
Do you see a correlation in the Industry Canada Study right down to the ISP level on file-sharing or P2P?
Rocky: Wow! You would think, by title alone, that the government would have looked at all aspects, when speaking of impact. There’s definitely some serious collateral damage in this case as, as much as there may be an affect on CD/DVD sales in the music industry, they’re (music industry) putting all of the ‘delivery costs’ back on the ISPs. So, as a result, they save on stocking fees, regular delivery charges through the postal system, marketing materials, never mind the physical CD/DVDs! Their entire cost structure to sell to the marketplace has been substituted with digitize/upload – wait for sale.
So, to your question. No, there isn’t a correlation to this study down to the ISP. If things were to be ‘fair’, then the ISPs would have to charge back to those selling the materials. An all but impossible job, so the ISP is then forced to up rates to accommodate for higher data load. A portion the government and decision makers probably aren’t considering when looking at this side of things. So, in essence, those downloading CDs/DVDs are indirectly paying for some of the music costs by virtue of having to pay a higher fee for their internet access.
… there’s definitely a few missing pieces to this problem!
Ottawa Gal: I want to thank you for the time given for this Q&A and insight into the industry and with what’s happening with one of Canada’s largest Internet Service Providers (Sympatico), and how it affects the small guys and users. I’ll let your wife plug you in now before she assimilates you . It’s been a pleasure and quite the interesting read for myself (as the non-technical user) to have this insight. Thank you.
Rocky: Not a problem, and thank you for the opportunity! I look forward to future discussions on this and other data related maters as the future of the internet will rely very heavily on how we approach the next years to come. Net Neutrality principals are nice, but only if it math’s out on all sides!
9. The Good, Bad, and Ugly board of ISP’s; http://www.dslreports.com/gbu
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