Internet service providers (ISPs) who own their own infrastructure will finish ahead of their business competitors, due to the ability to provide cheaper and better quality services, a Sydney company claimed last week.
Enet21, a five-week-old virtual internet service provider (VISP), claims the outright ownership of its infrastructure has allowed it to avoid the costs usually associated with being a middleman between the user and a carrier and pass on the savings to its customers.
'By owning our equipment and housing it on the carrier's premises, we enable Enet21 customers to dial direct to the carrier thus enabling us to charge less for the service,' Enet21's managing director, Julian Carter, explained.
The company claims to have achieved instant success among corporate and government clients by providing 'high-quality Internet access' cheaper than its carrier - connect.com.
According to Carter, Enet21 charges users $900 a month for unlimited access and unlimited traffic. By comparison, connect.com users pay $1000 for the same service, while ISPs using connect.com's infrastructure are likely to pay even more.
Carter believes 'third-party' arrangements often result in users experiencing drop-offs, busy signals and slow connections giving those who own their infrastructure an additional advantage.
'Our ratio of users to the modem is around 7-10 users to one modem whereas the smaller ISPs have a higher ratio adding to the level of drop-offs and slow connections,' Carter explained. 'We keep our ratio down to 7:1 and that ensures a quality service.'
But despite potential savings, the majority of approximately 650 ISPs in Australia still provide services to customers by leasing equipment and lines from carriers.
However, industry analysts predict the advantages of infrastructure ownership and customer demand will drive more ISPs towards the VISP model.