Ask LH: What Are Off-Net Plans?

Ask LH: What Are Off-Net Plans?

Hey Lifehacker dudes! I have been looking at some new internet plans and I have come across some “off-net” plans (specifically with TPG). I was wondering: what exactly is “off-net”, and why is it so much cheaper than normal? Thanks, Net Of Confusion

Picture by Brad Hinton

Dear NOC,

In simple terms, there are two ways in which internet service providers (ISPs) can provide an ADSL internet connection. Firstly, they can install their own equipment in telephone exchanges and provide a direct service to the customer. Secondly, they can purchase wholesale access to an existing ADSL network and then resell it to others.

Outside of Telstra and Optus (which both entirely run their own networks), most large ISPs operate on a mixture of their own equipment and reselling services purchased wholesale from others. (Smaller ISPs generally rely entirely on purchasing wholesale access.) TPG describes its plans which are based on wholesale Telstra services as “off-net”, to distinguish them from those which utilise its own network. It’s not a label widely used elsewhere.

Whatever the label, the consequence of this approach is that the pricing for off-net services is different, though I’d question your statement that it’s cheaper. For its own network using ADSL2+, TPG charges $29.99 a month for a 50GB plan, $39.99 for 150GB, $49.99 for 500GB, or $59.99 for an “unlimited” service. Its cheapest off-net plan costs $49.99 and has a 50GB limit. Even on a slower ADSL1 off-net plan, $39.99 gets 100GB, which is less than the equivalent ADSL2+ plan. In other words: TPG’s own network plans are cheaper. This tends to be the case across all providers that offer a mix of options: it’s harder to make a profit when your single biggest cost is wholesale access from a large telco.

Of course, it’s not much help knowing that if you’re in an area where TPG only offers “off-net” plans. However, at that point, you probably should widen your search to include other ISPs anyway (since you’ll be getting the same basic connection from many of them).

If you do have the choice between purchasing a provider’s own service and the one it offers “off-net”, I’d always go for the former, because in the event of a service issue, it makes things simpler. A problem with your connection could be caused by your PC or router, or by issues on the line or in the exchange. If you’re using an off-net plan, you’ll never be in direct contact with the organisation running it, which can make getting resolution much slower. In the case of TPG, it’s fair to say that many Lifehacker readers have been highly critical of its customer service, so you don’t want to add in extra complications unless there’s a very compelling price reason.

Cheers Lifehacker

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  • Its quite possible, depending on his location that the “Off-Net” TPG plan works out cheaper than Telstra own Bigpond plans.

    I live in Rural Zone 2; and Telstra are the only ISP who operate a ADSL2 DSLAM in my local exchange. As a result, my options for ADSL2 are limited to only Telstra and whose who re-sell Telstra wholesale. In my case, when I signed up for service, it worked out that iPrimus greatly outperformed Telstra, and other ISPs, in term’s of value for money.

    I do think that in some ways, this scenario isn’t strictly a negative (though in many ways it isn’t positive at all).

    For example, as I know that regardless which ISP I’m serviced by, I will still be using Telstra’s infrastructure and will be connected to the same hardware. This being the case, it means I’m less dubious of cheaper ISPs (such as Dodo), as the only variables between ISPs are pricing and customer service levels. Assuming Telstra do their job properly when they connect me, customer service shouldn’t be of a big concern if I don’t have to use it.

    • There is a significant difference between providers, even on resold Telstra DSLAMS. The connection between the exchange/backhaul, and the wider internet is managed by your ISP, and budget providers such as Dodo will perform significantly differently to premium providers such as Internode.

    • Remember that going direct through the DSLAM owner often has some benefits.

      If we imagine a fictional large telco who I have never been associated with… When they place a DSLAM in an exchange, they might reserve 50% of that DSLAM’s capacity for their Business Broadband product. They might then reserve 25% for their own consumer products, and then sell the remaining 25% to off net reseller plans such as these. Because this fictional large telco has a terrible rep for being expensive and a nightmare to deal with… often, the 25% reserved for their own direct consumer products will be quite lightly utilized, while the 25% reserved for their partners will be absolutely hammered with very high contention rates.

      This situation is of course entire hypothetical, but if you can afford the business broadband product from fictional telco’s – it’s usually miles better. And the direct vendor reserved segment usually also has a better quality of service.

  • The connections, the “backhauls”, from the exchanges and cabinets all over the country into the city NOC’s are NOT duplicated for each ISP,

    For example, take the Telstra DSL network..

    There’s over 7000 telstra DSLAM sites across the country ! It wouldn’t do to duplicate the backhauls for each (large) ISP.

    Generally the backhaul back to the capital city is provided by the owner of the DSLAM!

    The various ISP’s then connect to the Telstra DSL network at a few POI (Point of Interconnect) in the a state capital (S,M,B,P) or a few.

    The ISP’s may have to pay for the size of their interconnect, which may affect throughput at peak times,

    and they then connect their customers to the internet in various ways, so you can get performance and reliability differences between ISP’s.

  • Different Telstra resold services will perform differently and customer service with TPG isn’t much fun.

    I would suggest you have a look at Exetel’s “wide coverage” plans as well. The always have enough bandwidth to cover peak times.

  • “or $59.99 for an “unlimited” service. ”

    Minor point, but there’s no need for quotation marks around the unlimited on the TPG plan – I’m on it and there are no download limits, shaping, quotas, nothing – you can download as much as you like/can at full speed with no financial penalty.

    • couldn’t agree with Scotty more here…i’m on TPG’s unlimited plan and it’s just as advertised…I would love to be on the NBN but not if it means having shitty download limts again.

  • I am quite interested about this idea of backhauls affecting a broadband connection’s speed (Leon/Greg). I always thought a connection would be identical, as long as it was using the same copper wire infrastructure, and the same DSLAM at the exchange.

    For example, if a TPG ADSL2+ connection starts at an exchange at 24Mbps from its DSLAM unit, and an Internode ADSL2+ connection starts at an exchange at 24Mbps from its DSLAM unit, and they’re both theoretically running on the identical Telstra network copper wire, then wouldn’t the speed be the same at the customer’s residence?

    This goes the same for ADSL connections that are being resold wholesale from Telstra ports. If I am on an 8,000kbps speed connection with iiNet, and I change it to iPrimus, wouldn’t the speed be identical? I’m using the same modem, the same copper wire, and the same Telstra wholesale ADSL1 port at the phone exchange…

    It sounds like you guys are saying how an individual ISP (Internet Service Provider) controls a backhaul also affects a connection’s speed. What does the broadband provider need to do in order to ensure a fast, stable connection? If the ISP doesn’t pay as much money (to Telstra?) as another ISP, does this mean Telstra won’t put as much effort into the service? What actions are being taken/not being taken that result in a difference in connection speed? Can you be specific?

    Jesse, Compare Broadband

  • I am thoroughly confused!!

    I am on the edge of the CBD with Optus on a seniors plan, which is great.
    Moving to outer suburbs soon, only Telstra can give me a service except for these “off-net”
    providers, any hints please. I am only a small user of the net.

    • I am confused too! If you’ve got kids, it’s better to live in a cardboard box as long as it has good internet at a sustainable cost. …..I think we’ll have to move house to a location with good, “cheap”, internet, as wireless broadband is unsustainable, and that’s all we’ve got.
      Doesn’t seem to be any more recent comments here than your’s, have you noticed?

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