Telecom is launching something – I’m not really sure what it is, but apparently it will be some sort of Business Oriented Internet plan/ISP – where you get bundled internet access, hosting and things like Xero.
Business broadband plans will be “slightly differently priced” …
I read that as “more expensive”, but gee I’d pay anything for half decent NZ internet access – maybe even set up a business specifically to get it to my home.
and the services they encompass will also be different, she says. “There will be some guarantees about helpdesk and support.”
Good. Indeed I do not know why more businesses don’t follow Trade Me’s example and set up 0900 (paid) customer service lines. When I want help, I want a really competent human to immediately answer the phone 24/7.
The business Internet service will register domain names for customers and offer to develop and host their websites. It will also provide managed e-mail services suitable for businesses and online backup.
Hang on – why on earth would we want to get Telecom to provide those services?
Domain names, well maybe. But develop websites? Telecom outsourced their own unmitigated disaster of a website, so why would we not use any number of the excellent NZ design and development shops?
As for hosting, well let’s see what Xero themselves do…
Currently Xero is being hosted at Rackspace, in Houston Texas. (Follow that first link for all sorts of other fun stuff about Xero.com’s presence.)
Now – and this is really important for any Telecom employees involved in this effort – go to that Rackspace site. When you get there for the first time a popup appears – a real live person is actually offering to chat with you.
Close that down and browse the site – it is all about “fanatical support”. View the video testomonials, check out the offers and go ahead – order up a server and try them for real (or maybe just call some of their customers)
That’s the standard to aim for – fanatical customer service, 24/7. That’s what you’d need to offer for this service in order to make a difference, and sadly you’d need to do it at prices that are competitive with getting services straight from the USA. (and that’s not a lot).
So – overall – it is good that Telecom is targeting small businesses, and I hope that they’ll stick to investing in providing reliable, speedy access to the internet and not get diverted into competing away from their core.
Lance Wiggs 
Not to hijack your post, but I was a little surprised that Rod is hosting offshore after all the rhetoric about NZ’s infrastructure.
I don’t disagree with the decision as it’ll be economical, scalable and relatively quick, but I would have thought a SaaS offering would have tried to cluster hosts closest to the point of demand to reduce the latency (USA being some distance from NZ and the UK).
I’ve said it before though, you have to be willing to gamble if you host in NZ given the high overage charges. A Slashdot/Digg/media story about your website could financially cripple you.
There are good kiwi providers that provide hosting in multiple countries, rimuhosting for one example.
LikeLike
Bwooce – thanks for the comment
However – can any of the local hosting providers come close to the service level and price offered by Rackspace?
To me hosting is a scale game – you need access to cheap reliable electricity, cheap and redundant connections to the internet, cheap reliable boxes and great customer service staff. And you also have to be able to build it all on the cheap and quickly. Scale matters – the more customers you have, the cheaper everything is.
We fail on four (internet access, cheap boxes, cheap building and scale) out of six of those.
So why not leave it to those with the natural advantage – and keep the real value of Xero, which is in the design and development, along with the sales team(s) in NZ and close to market respectively?
LikeLike
It seems Ben (at Diversity – the trackback below) is involved with the offering. As he says, let’s wait and see. (Why the pre-announcement though?)
I still fail to see the unfulfilled need here – and I am failing to see how Telecom is the natural provider to fill that need if it does exist.
Perhaps Ben has put together a Silverstripe backed solution with a host of uber-cool NZ design firms providing services. That would be cool – but this is Telecom right?
LikeLike
C’mon Lance, Telecom is free to do whatever it likes, it is a private business. Telecom is answerable to its shareholders only and not what the public thinks.
Lance said…
Now – and this is really important for any Telecom employees involved in this effort – go to that Rackspace site. When you get there for the first time a popup appears – a real live person is actually offering to chat with you.
Are you sure about this? Is it a real live person at the other end from Rackspace or it is a software agent (SA)? Do you have any confirmation that it is a live person? I believe that it is the latter, ie, an automated help desk software agent, similar to the familiar Microsoft Office Assistants, nicknamed Clippy (paper clip) for Microsoft application. Clippy is a learning software agent which has a knowledge-base to infer conclusions from when it has a dialog with users. Automated software agent like clippy has a Natural Language capability, ie, why some people have mistaken live online software agents for humans, because their response back to users are in human form natural language (well close as possible to).
LikeLike
Hi Lance.
I do agree with the business economics decision to host offshore. I just can’t reconcile it with Rod’s arguments to enhance the local infrastructure. Hosting offshore supports the counter-argument that international bandwidth is sufficient to offer business services to NZ customers. It might not be great, but it is at the proper “good enough” economic compromise level.
My main point is that for SaaS the one thing you can’t fix is network latency. This directly impacts the User eXperience, and it’s all about the speed of light, electrons through copper, and the number of interconnecting switches (more the latter than the former…). The more rich Web 2.0 features used generally result in more round-trips, and the latency gets more and more noticeable. Faster servers and better connectivity can’t touch this.
I have these sorts of UX concerns with Cashboard. Hosted in the US, using RubyOnRails, it isn’t as snappy as it could be. The only fix I can see to this “Tyranny of Distance” is to manually or automatically distribute content closer to users. A PaaS provider could facilitate this…
Compare some real data. My TelstraClear box ping roundtrip time is (right now) 200ms to xero.com. It is less than 20ms to kiwiblog.co.nz (Inspire peer with TC, who knew?). TradeMe is about 20ms too.
Multiple round-trips at 200ms gives visible delay to the user and I’ve not taken into account the time the server needs to process a request. The sort of round-trips I’m talking about is a dynamic request for some javascript, that when run locally (onload() etc) requests more content. Pretty typical AJAX stuff. Take 200ms for the js, plus 200ms for the content, and you have a noticeable delay. Chain a few more of those and you have an unacceptable delay. You wouldn’t even notice if that delay was 20ms+20ms, it would just pop.
You can improve designs to take this latency into account, and we might find that Australians and NZers become experts in efficient SaaS delivery because of this. I think that hosting locally is far easier than this kind of tuning though.
Back on topic, when are we going to get more details about what TNZ will be offering? The linkage with Xero is intriguing, will it be a Flickr type deal or something with more meat?
LikeLike
Hosting sensitive accounting data offshore where there is (essentially) no rule of law governing data acquisition by the US Government…? Uh oh.
I’ll take Rod seriously when he hosts onshore and stops thinking that Telecom has anything significant to contribute to the NZ Internet.
LikeLike
Hmmm – I was convinced that Xero was hosted by Revera here in NZ – http://www.revera.co.nz. I wonder if they moved offshore recently, or perhaps I was just mistaken?
LikeLike
Stuart
You may be right for NZ traffic. Perhaps someone could check from there – I’m in Perth right now.
Stu – sadly Telecom does have something significant to contribute to the Internet – they basically own all the infrastructure. Far better to have them as part of the solution than start again.
It does make me wonder at the US traffic security though – especially their laws which seem to be pretty permissive round capturing traffic that flows into and out of the country. Still – we are in a survellance society and should get used to it.
Lance
LikeLike
Well, the situation is this: Telecom have operated a short-sighted strategy (capture the customer, feed them marketing, incrementally patch and fix) for 20 years. This latest initiative shows no difference.
I’d guess that they will be running business-level access on the same ADSL as a business can get now and just charge differently. But that’s not a supported service, so what use is it to a business? Sure you could move to the fibre product, but that’s oversold and not available everywhere.
So the question is: if you own the infrastructure and you still can’t genuinely perform (in terms of providing quality, reliable products), of exactly what relevance are you, long-term?
The answer going forward is for more enterprises to own more of the infrastructure and for more of that infrastructure to either be publicly-owned in perpetuity and/or open access.
LikeLike