Tiscali executes stealth LLU migrations

Thousands of ex-Pipex customers have been suffering unexplained interruptions in their broadband service in recent weeks, as their new provider Tiscali stealthily works to cut costs.

People suffering a broadband outage as a result of the work are told by customer services, recently outsourced overseas, that their line is undergoing "essential engineering work". One Reg reader was initially told the downtime was BT's fault.

Top broadband watchers Thinkbroadband.com blew away that figleaf last Monday.

In fact, Tiscali itself is performing mass migrations to its unbundled network in order to save money, as it bids this year to turn a profit for the first time ever.

Tiscali paid £210m for 570,000 customers of Pipex and its subsidiary ISPs last year. A source at one of the acquired ISP brands said the new owners have ordered a focus on customer volume rather than the quality service it has been known for.

"The logic is that we'll save more money placing customers on the Tiscali backhaul per month than we will lose from customers migrating away," he said.

"So far we've had our SMTP Servers replaced with Tiscali's Iron Ports and now we've been forced to replace our DNS Servers with Tiscali's."

He also claimed that Tiscali has indicated it wants to place a full block on peer-to-peer applications at peak times in the evening.

The tens of thousands of ex-Pipex customers affected are not being told about the move because ISPs "do network migrations all the time", a Tiscali spokeswoman said. She denied the claims that former Pipex customers will get an inferior service on Tiscali's network - a natural worry given its reputation for strict bandwidth-throttling and data allowances.

When done right, unbundled lines offer some of the fastest and most reliable ADSL service in the market. O2's Be and Sky's LLU broadband offering are often praised.

Tiscali provides broadband for some of the lowest prices around, however, and as a result service is inevitably restricted to cut costs. Pipex traffic will now be throttled (or "managed", according to taste) by Tiscali's Cisco P-Cube bandwidth-throttling hardware in its central infrastructure.

Tiscali rejected concerns. "Pipex (including Nildram and F2S) was using traffic-shaping technology also, and we will be applying the same profiles they had in place prior to migration," the spokeswoman said.

The Cisco gear has caused Tiscali users problems in the last two weeks because of a botched software update that cut off iTunes and other popular internet services. Tiscali's broadband support forum suggests many are still suffering very slow speeds.

She said they would be offered cheaper "Tiscali-type" services later this year. The mass migrations are being done to offer people better line speeds and reliability as well as to save Tiscali money, she insisted, and speed complaints have dropped. So why not tell them about it?

An Ofcom spokeswoman said it's unlikely Tiscali would be contravening any regulations if the quality of the connection does drop. If it is changing the service described in Pipex's broadband contracts, it must give customers 30 days' notice and allow them to switch away. However, such agreements are typically carefully-worded so that line speed and data allowances are not guaranteed.

Tiscali is currently the only ISP with its own LLU infrastructure as well as customers served via BT's IPstream and DataStream wholesale products. The primary goal of the mass migration programme is to cut out IPstream provision, which is the most costly for the firm. If Tiscali hasn't unbundled the local exchange they will be shifted to DataStream service.

Earlier this week, the man in charge of Tiscali's Italian parent company said that profit is his number one priority for 2008. He also hinted that a sell-off of its UK broadband business is likely in the next two years. ®