In reply to a post by RobertoS:

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Plusnet at £19.99 including Vat is £16.66 net + £3.33 Vat. The Openreach monthly charge to them for the 80/20 product is £9.95. Gross profit £6.71pm.

So Plusnet are rip off then? Charged customer £10.04 extra a month (a nice £180.72 profit for Plusnet in a 18 months contract)

God, I hate ISP who ripped us off.

If Openreach saying £9.95 per month then PLusnet should sold it as £9.95 a month not £19.99.

No they have to buy from BT wholesale the BT openreach prices are for ISP's like Sky and TT who have their own LLU kit in exchanges Zen orders from both as they have some exchanges enabled ,

Plusnet don't buy from Openreach - check the BT Wholesale WBC price list.

Standard EU Rental (FTTC 80Mbps Downstream, 20Mbps Upstream) N/A 11/04/2012 Month £16.00

add to this bandwith costs from BTW and other networking costs such as peering then staff wages

But they do make a heathly profit on long contracts and install fees on incoming CP Migration (BTW CP - BTW CP FTTC to FTTC) &CP Migration (Openreach CP - BTW CP FTTC to FTTC) BTW now charge £11.00 for those migrations, and there is now a 1 mth min term to cp's/isp's on qualifying FTTC migrations, and then there is WLR3 + calls calling plans they make most of their profits from this and are used to subsidise the monthly bb fees

Edited by tommy45 (Mon 02-Feb-15 21:47:55)

I think Plusnet are probably the only ISP (they have no LLU network) to pass on some savings they get to the end user with their "low cost" area pricing for their BB products are they not?

In reply to a post by adslmax:

So Plusnet are rip off then? Charged customer £10.04 extra a month (a nice £180.72 profit for Plusnet in a 18 months contract)

Mixing up Vat inclusive prices and Vat exclusive prices is not valid Max.

Businesses pay supplier price + Vat to their suppliers and charge their marked-up price + Vat to their customers. If my figures had been right the gross profit is as I posted.

Each supplier in the chain sells at (cost + markup) x Vat rate. Each pays HMRC their Output Vat minus their Input Vat. At each step in the chain. As a result, at each step in the chain a business pays HMRC the Vat on its markup, in other words it pays tax on the value (price) it has added.

That's why it is called Value Added Tax.

God, I hate ISP who ripped us off.

Think about that too Max . If amongst BT Wholesale-based ISPs Plusnet is almost the cheapest, how can they possibly be ripping us off? I suggest any ISP with a lower markup is at risk of going bust.

If Openreach saying £9.95 per month then PLusnet should sold it as £9.95 a month not £19.99.

That's even dafter! Who pays for the backhaul, as already mentioned? Who pays for the Plusnet routers, sales and support staff, office space rent and rates, heating and lighting, and so on and so on? That all comes out of the gross profit figure of the (fictional) transaction being discussed.

Not forgetting they are one of the most expensive on a Market 1 exchange.

In reply to a post by professor973:

Not forgetting they are one of the most expensive on a Market 1 exchange.

I wasn't aware of that are you sure?

My exchange is 20CN mkt 1 no LLU thought PN pricing and usage allowance was pretty good compared to many other ISP's.

I'm sure - been there and got the T-shirt. See Fuel or EE broadband or Zen line rental. I am paying £6 line rental with Pulse8, a company that have no contract tie-in even for fibre and the lowest call rates. PN near enough as expensive as BT at £38 per month on Market 1. There are better deals with no contract tie-in.

Edited by professor973 (Thu 05-Feb-15 13:24:28)

Their small print suggests that the £6 line rental is only available if you take Pulse8 XL broadband at the same time.

Still cheap for market 1 areas, but the line rental to broadband tie-in is worth noting, as some might presume you can get the £6 deal when taking broadband elsewhere.

Line rental is £13 per month if you don't take their broadband.

Quite correct, but still far cheaper line rental than just about any supplier and no 18 month contract tie-in even for fibre which includes line rental (In the small print)! £25 for BB & Line is on a par with EE which is considered cheap - After all, it's not as if we can have Broadband without line rental.

Edited by professor973 (Thu 05-Feb-15 13:36:01)

Plans are progressing to offer FTTC without line rental, i.e. no voice support at all - a work in progress.