From ISPs and WISPs to networks in libraries, businesses, and universities, Internet use is on the rise. Yet, as the demand for Internet access continues to grow around the world, so do both the opportunities and challenges for service providers. Just as quickly as your user-base grows, the obstacles facing providers begin to emerge.From competition to unhappy customers, the venture that once seemed certain to succeed can quickly test the will of even the most battle-hardened and tech savvy business owners and network administrators. However, for all types of Internet providers, there are ways to make the process smoother.
For All Providers…
1. Set Boundaries from the Start – When starting up a new service, don’t let your users run wide open. You may be OK without putting rate caps on users when you have only 10 users sharing a 10 meg link, but when you get to 100 users sharing a 10 meg link, you’ll need to put rate caps on them all. The problem with waiting is that your original users will become accustomed to higher speeds and will not be happy with sharing as your business expands – unless you enforce some reasonable restrictions up front.
2. Keep Your Network from Locking Up — Many Internet providers believe that if they set maximum rate caps for their users that their network is safe from locking up due to congestion. However, if you are oversold on your contention ratios, you will lock up and simple rate limits are not enough. Don’t make this mistake.
This may sound obvious, but let me spell it out. We often run into operators with 500 users on a 20-meg link. They then offer two rate plans — 1 meg up and down for consumers and 5 megs up and down for businesses. Next, they put rate caps on each type of user to ensure they don’t exceed their allotted amount. Somehow, this is supposed to exonerate the operator from being oversold. This is all well and good, but if you do the math, 500 users on a 20 meg link will overwhelm your link at some point and nobody will be able to get anywhere close to their “promised amount.”
If you are oversold, you will need something more than rate limits to prevent lockups. At some point, you will need to go with a layer-7 shaper such as Packeteer or Allot NetEnforcer. Or, you can use a NetEqualizer. Your only other option is to keep adding bandwidth.
3. Good Tech Support Is a Must — Don’t put all your faith into the local guru who set up your network. There are many good technical people out there and there are many more that will make a mess of your business. This can create some really tough decisions. I like to use this analogy:
I’m not a concert pianist – not even close – so I can’t tell the guy that hacks away playing Beatles tunes in the piano bar at my local pub from a Julliard trained pianist. Since I can’t play a lick, they all amaze me. Well, the same holds true for non-technical business owners hiring network techs or developers. They all seem amazingly smart when in fact they may run you into the ground. The only way to tell is to find somebody with a really good track record of making things work for people. So, ask around.
The good ones have no vested interest in making a custom dynasty of your business (another thing to watch out for). It’s like the doctor who needs the patient to stay sick. You don’t want that. Poor or misguided tech support may be the single largest cause for failed ISPs or issues with selling your business.
4. Don’t Overspend – ISPs and WISPs, remember that on the open market your business is likely only to be valued at three quarters of your revenue, so don’t delude yourself and overspend on equipment and borrowing thinking that a white night will come along. If your revenue is $500,000 per year, you will be in good shape if you get $400,000 for your business. And this may just cover your debt. Yes, there are exceptions and you might get a bit more, but don’t expect two-times your revenue. It’s just not going to happen, so plan your expenses accordingly.
For network administrators in both public and private companies and institutions, funding is not always a given. Budget cuts and funding reallocation can leave administrators in a bind. So, be judicious when planning and managing your network. Take things like recurring costs and licensing fees into consideration when making purchases. Over time, these expenses can add up.
5. Optimize Your Bandwidth — A NetEqualizer bandwidth controller will allow you to increase your user base by between 10 to 30 percent without having to purchase additional resources. This allows you to increase the amount of people you can put into your infrastructure without an expensive build out. Yet, a purchase like this can be a difficult decision. It’s best to think in the long term. A NetEqualizer is a one-time cost that will pay for itself in about 4 months. On the other hand, purchasing additional bandwidth keeps adding up month after month.
For Commercial ISPs and WISPs…
6. Make Sure You Have a User-Base to Grow Into — For ISPs and WISPs, perhaps 500 households before you start building out. Yes, you can do it for less, but 500 is sort of a magic number where you can pay yourself and perhaps some hired help so you can be profitable and take a day off. WISPs and ISPs with 100 customers are great, but, at that size, they will remain a hobby that you may not be able to unload a couple of years down the road.
7. Be the Reliable Alternative — If you are in a dense metro area, and have the resources, you can offer Internet connections to hotel and business customers with pay-as-you-go services. Many hotels and businesses have unreliable connections, or none at all. Obviously you’ll need real estate across the street, but once secured, you can point a directional antenna into the building and give your signal a recognizable name so your users will connect. Then, offer them the connection for a daily fee. For many users, paying a small daily fee for reliable service will be worth it – especially if the hotel or business offers sub par Internet service, none at all, or a connection for an exorbitant price.
8. Make Payment As Easy As Possible — When a customer is delinquent on paying their bill, make sure you have a way to direct them to a payment site. Don’t just shut off their service and wait for them to call. For small operators, you don’t need to automate the payment cycle, just send them to a static page telling them how to pay their bill. For larger operators (3,000-plus users), the expense of automated bill payment may be worth the extra cost, but with a smaller set of customers, a static redirection to a page with instructions and a phone number will suffice.
9. Look for a Competitive Credit Card Processor — Your bank will likely provide a service for you, but they are generally a middle man in this transaction. There are credit card processing agencies that sell their services direct and may be more cost effective. These are no-brainer dollars that add up each month in savings.
10. Cross Market — Don’t be shy about it. Once you have a captive audience, there are all kinds of cross marketing ideas you can do for extra revenue. Done tastefully, your users won’t mind. This could be a special with the local car dealer running coupons for them. Or for something like a pizza place. There is unlimited potential here, and if you’re not taking advantage of it, you’re missing out on easy revenue.
Obviously, these 10 tips won’t apply to every Internet provider, but it’s almost a given that at least some of these issues will emerge over time. While there’s no guarantee that any network will operate perfectly, these tips should help steer Internet providers and network administrators in the right direction.
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