Premium service in broadband

You want faster speed? Than you pay for it! This seems to be the motto of BigAir, an Australian Internet service provider, which is offering 10Mbps broadband service to some of its residential customers. The catch 22 is that this service costs over "16 times as much as most basic ADSL services, priced at US$380 per month with downloads capped at 100GB."

Okay, who would like to download that much per month in the first place. However, while it is okay to pay more for premium service in a tiered-service, there is the question, how long can they sustain the offer. Sooner or later, competition will come in with a cheaper offer, trying to attract those premium customers.

Moreover, 10 Mbps is not that much. With the advancement of technology, this might be something pretty slow in the near future - what will happen than is that you have some customers that signed up for a longer contract and which are unhappy, since they cannot migrate to a faster and probably cheaper service with the competition. Would I say that this is a sustainable business model? Nope, I wouldn't. Short-term, yes, long-term - no.

(By Asia Business Consulting)