New Site Goes Live

[jamcamuk]

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Originally posted by MarkR
Hello,



There is a cost of £??.?? (inc VAT). Please note that payment for service migration must be made using a credit or debit card.


HTH,

Mark

yes this a error on our data base it will be updated.. thank you for letting me know

James

[mcol]

the business pricing is remarkably cheap, but there's no mention of contention ratios.

Without that information I wouldn't even consider buying. In fact I'd make the assumption (rightly or wrongly) that it was just domestic ADSL with a few extra pop boxes.

The site's nice and professional looking though.

regards

[judehk]

Very nice looking site.

One thought is, have you done a cost/benefit on offering free setup + modem versus charging the £70.

When you charge £70 your conversation ratio is likely to plummet. Pulling figures out of thin air, I would guess the conversion ratio with free setup etc would be 250:1 and without would be 750:1. That means you need an extra 500 visitors per sale. Not sure where your traffic is coming from but its pretty tough to get free traffic for commercial sites from search engines (ie Google) now. If you are paying £0.15 per click that means you pay an extra £75 per sale when you charge for a setup.

This is totally dependent on the conversion ratios and cost per click, but I think it is the right way to look at the problem. I'm thinking of setting up my own ISP and have been chewing on this issue for a while....

Anyone have any thoughts on this..

[watcher]

Smaller players aren't going to beat the big players on price - they don't command the same scale of economies, plus some of the big players have their own infrastructure in place.

So, your're going to have to bring some other value that the big players don't offer and would be uneconomical for them to do so.

Understandably, easier said than done - which is why the basic cost of entry for VISPs is relatively cheap - its a hard model to make profitable.

Service differentiation, as in the physical business world, will be the key to success.

[KieronD]

Originally posted by judehk
This is totally dependent on the conversion ratios and cost per click, but I think it is the right way to look at the problem. I'm thinking of setting up my own ISP and have been chewing on this issue for a while....

Anyone have any thoughts on this..

Well I run my own dial-up VISP as well as a Broadband VISP. The dial-up VISP does OK but nothing fantastic. More and more people are migrating to Broadband so therefore the only customers that I seem to have are people who use the service when their Broadband goes offline.

As for the Broadband VISP the problem is the same as above. Although the monthly subscriptions were reasonable they charge for connection and a modem. In this climate this just won't work when competing against the big ISP's who have vast marketing budgets available to acquire customers. I marketed the Broadband VISP like mad for about 3 months and got zero customers. This was with very targetted ppc traffic. All I seemed to get was emails asking me why I charged connection fee when Freeserve/BT/Tiscali/AOL everybody else didn't.

So I have now binned it and promote the big broadband players with much better results.

Kieron

[watcher]

And of course, with Tiscali you get residual income - its a very powerful proposotion.

[judehk]

Cant see a reason why small players cant compete on price if they are well capitalised. A modem is around £40, plus a customer aquistion cost of about £25 per customer could be covered by the profit on a customer account over a period of about a year given a selling price of £23 pm. Accounts that stay with you for over 15 months would earn you a profit.

Big issue is obviously covering the negative cashflow at startup - I think you would need about £50k to make it work (not sure whether this excludes small players - but would definitely exclude me as the missus would bury me alive)

Tks for sharing your experience Kieron..

[watcher]

judehk,

It's not only the cost of the modem to cover to compete with the likes of Tiscali - it's the connection fee as well. That takes the subsidy to over £100. Even if you do that, your're only just competing - you lack a brand so given the choice between a well known brand for the same price and service as an unknown, smaller entrant, Joe Public is most likely going to opt for the well known brand - so I you will have to undercut the big players by a hefty amount unless you are bringing something else to the table.

I've been thinking around this subject for many months myself - but I always come to the same conclusion and now like Kieron I promote Tiscali.

Sorry to jamcamuk, I've put a bit of a negative spin on this. I hope I'm wrong and wish you well with your venture.

[judehk]

I'm pretty sure Tiscali and Hauka vISP's have no setup fee (BT's vISP however does) - at £23 I think you would temp people away from BTYahoo at £30 (just a theory however, havent tested that one at all...)