Company Report
Last edited 6 years ago
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#115
Performance (66m)
6.0% pa
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#Bear Case
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Last edited 6 years ago

Megaport is an ISP (Internet Service Provider). Their software measures you bandwith used then makes an estimate of your future bandwidth requirement. Based on this estimate (or your manual estimate), they can throttle your internet connection to limit your bandwith (keeping surplus bandwidth). They rent you a physical connection at 1gbs, 10gbs, or other (as would any other ISP). The surplus bandwidth up to the limit of your connection can be sold to other Megaport clients. The savings COULD make Megaport cheaper than othe ISPs. If they were the same price as other ISPs, Megaport would have to offer more in order to be competitive.

Faster page loading for cloud software: It is normal for ISPs to pre-load (cache) pages from cloud service providers, and other internet web sites, to make them faster for customers to load. IT departments can also cache (remember previously downloaded pages) pages for extra speed. I do not believe Megaport are able to make this significantly faster (or would need to under any circumstance). I suspect this is marketing rather than superior technology.

Cloud service providers offer VPN (Virtual Private Network) access. This provides security and speed advantages. When you access the cloud service provider via your login a point to point connection / tunnel is made with encryption. This is not a Megaport technlogy and I suspect this to be more Mega-marketing. VPN technology allows you to login and use your cloud service providers software even if you are in geographic area not normally supported.

 

Conclusion

I believe the Megaport technology is not significantly different to that used by other ISPs. I believe that most of the technology they use is common. Bandwidth measurment and throttling do not offer significant financial benefit to customers or shareholders. Megaport appears to be less about NEW technology and more about building credibility by name dropping cloud service providers. Bare77 on the MP1 #Managment straw voiced concerns that Bevan Slattery may not have the longest term view and may sell at out at maximum hype leaving others to hold the can (this is how I read it as this supports my current thinking).

I would enjoy being proven wrong.