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Choosing an Internet Service Provider

With the Internet becoming increasingly important for home and business users it's critical to choose an Internet provider that offers a reliable service that suits your budget.

Like mobile phone plans, Internet plans are complex and if you can get them wrong you can be lumbered with an expensive bill. There's a few things to look for when choosing an Internet provider.

Know what you need

Before entering into any Internet plan you should determine what your needs are. If you want an Internet connection just to send the odd email and do Internet banking, then a slow plan with a 400Mb capped connection will be fine. If you have teenagers downloading music a videos, then a fast plan with a 20 or 60 Gb limit will be more appropriate.

Because everyone's needs are different, you have to make the decision on what plan suits you. Keep in mind your own circumstances can change and you might have visitors stay with you who could easily exceed the limits you normally wouldn't go over.

If you have no idea what you will use, play it safe and order a typical plan. This should have at least a 1Gb data allowance and the plan should be capped. We can't emphasise how important it is to get a capped plan. The alternative is writing an open cheque to your ISP.

What price

You also have to consider your budget. Can you afford 10, 50 or 100 dollars a month? There are also upfront fees for connections and modems that could be anything between $30 and $500 for a home user unless you are prepared to commit to a 12, 18 or 24 month plan.

When budgeting for your Internet connection, be aware of excess usage fees. Most plans have a data limit and when you exceed that, some plans will charge you a rate per Mb. We've seen bills of over $25,000 so it's important to avoid these plans, we discuss capped plans below.

What type of Internet connection?

There are a number of different ways of connecting to the Internet. Dial up is largely dying as it's slower and more expensive while satellite is expensive. This leaves the broadband options as the main way of getting onto the net.

Broadband can come into your home through cable on the pay tv cables, ADSL through the telephone line and wirelessly. Wireless is a confusing issue that many people mix up with the home wireless networks. We explain the difference between wireless technologies on our different flavours of wireless page.

All of the different flavours of broadband have their advantages and disadvantages as we've discussed previously. Wireless and cable are only available in limited areas and there are only a few providers. We recommend ADSL for most users as the market is far more competitive and offers better value for money than the cable and wireless options.

Get a capped plan

The common complaint from Internet users is excessive bills. Most Australian Internet plans have limits on how much data you can use. When you pass that limit you will either be charged a rate for excess use or be "shaped" as part of a capped plan.

A capped Internet plan slows the connection down when you pass the data limit. Rather than receiving an nasty surprise when you receive your Internet bill, you have a slower connection until the end of the billing period. It can be an inconvenience, but it won't break the bank.

Some providers have a combination of caps and excess use fees. That is, they charge excess use fees up to a certain point and then cap any further costs. We recommend avoiding these as they still can give you a nasty surprise. For instance, one provider's $9.99 a month plan can be up to $69.99 a month should you over the 150Mb limit.

Another factor to consider is the capped speed. Capped speeds are usually 64Kbit, which is a little faster than an old dial up connection and is still usable for web surfing and email. Some though are only 32Kbit which we recommend you avoid.

How much data

The next step is to decide how much data you need. A typical user should be able to get away with 1Gb a month. If you have teenagers in the house the sky is the limit.

A capped plan is usually a good warning if someone in your household is using the net excessively. The slower limit will frustrate the power user while mum and dad can still use email and the web on the lower speed. It's certainly better to put up with a slow net connection than receiving a massive bill.

If you find the cap is too low, most Internet providers have no charges for moving up to a higher usage plan. So we'd recommend being conservative at first and increase your plan if you find you're regularly being capped. Check before signing up that you won't be charged a fee should you decide to move up to a higher monthly limit.

Plan speed

A big selling point for broadband is you can choose the speed to suit your budget and needs. The cheapest plans are 256Kbit, which is fine for basic websurfing and email. Most people are prepared to pay for faster speeds.

The fastest speeds currently available are 24Mbit on ADSL and 30Mbit on cable. Some of these are surprisingly affordable. But there's usually a trade off with download limits.

It's important to remember too that the faster the connection, the more you tend to download. So a limit that would be fine with 256kbit connection, might not be with a 24Mbit connection.

Connection fees

There are few broadband plans that don't have up front connection fees. These vary substantially between providers and it is important to be aware of these costs before committing to a contract.

Most connection fees include equipment. Cheaper connection fees may have cheaper modems or nothing at all. If you are planning to share a connection between computers, then a more expensive fee with a router, either wired or wireless, may be better value.

Like mobile phone plans, it's possible to get out of paying a connection fee by committing to a long contract. If you are prepared to sign up to a one or two year contract, you'll often find the connection fee will be waived.

Contract lengths

Like many other businesses Internet service providers like to customers to commit to long term plans. This helps them with their budgets and cash flows.

For the customers, these plans often have benefits like discounted rates and no upfront fees. But they do lock the customer into a minimum monthly or annual spend.

We recommend users choose plans well below their budget. Usually ISPs have no problem with customers wanting to upgrade their plans during the contract so if you find the plan doesn't meet your needs you can increase your speed or data limits without penalty.

Before entering any contract, it's important to read and understand the terms before committing to it. Understand what your costs will be and budget accordingly. If you don't understand anything, ask the ISP what it means before agreeing.


The Internet is a big, complex beast and the technology that lets you connect to it sometimes hits problems. When those problems hit, you need a helpful support line. Some of the cheaper providers skimp on support and a few even charge premium rates while you are talking to them. Choose a provider with good support who doesn't charge.


It's surprising how little ISP's market their extras. Many ISPs include spam filtering, virus scanning, five or more email addresses and other useful features. Others charge extra for such things.

We recommend choosing an Internet provider that throws in these features for free. Other features such as movies and music downloads are often not particularly good value and can be had without going through a certain ISP. Again, it's a matter of shopping around for the service that has what you want.

Bundled plans

All the telcos are currently trying to entice customers into "bundled" plans where the customer has one bill that include landlines, mobiles and Internet.

These can be good value for money but are usually insanely complex. To make it worse, telcos often don't understand the bundles they offer as consultant David Hyvatt says, "telcos think a bundle is a pricing plan, not a service package".

We recommend avoiding bundled packages unless the offer is extremely good and you've checked the details closely.

Business users

Business users have different needs. If email and the web are essential to your business, then you should invest in a business grade connection. Nothing irritates a computer technician more than a businessmen whingeing about being unable to recede critical email because their $29.99 a month Internet account is down.

More advanced business functions such as web hosting, Virtual Private Networking and remote access require features like static IP addresses and web hosting. Most cheap plans don't offer these. Both Optus and Bigpond cable also don't offer many of these features so we don't recommend cable broadband for business use.

When things go wrong

It's estimated between seven and twelve percent of telco bills are incorrect. This is true of Internet providers with 14,000 complaints about Internet providers in the last three months of 2006. So there is a chance you many find yourself in dispute with your ISP.

If you do find yourself arguing with an ISP, it's important to contact them first and try to resolve the dispute directly. It's easy to become exhausted disputing bills as ISP call centres are very good at sending you in circles. If you find you are getting nowhere, then you should contact the Telecommunication Industry Ombudsman.

If you do have a dispute, document everything and do as much in writing as possible. While some are fairly slow to take action against unpaid bills, others are very aggressive in their debt collection so we, like the TIO, recommend you pay your bill and then argue about it. We have more on arguing with a telco in our Dealing with an ISP dispute page.

More research

The best resource for finding the right plan is Broadband Choice. You can search broadband plans by location, cost, speed and download limits. Finding a plan that suits your budget is important as some plans can be very expensive.

The Internet is quickly becoming an essential service in most homes and offices. To really enjoy the benefits, you need to find a plan that meets your needs. Everyone's needs and budget are different, so you have to do some research yourself.

For the typical family, the plan we'd recommend is a 512kb plan with a minimum of 1Gb download allowance. This should cost between 40 and 70 dollars per month depending up the price.



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©Technology Publishing Australia, 2008