by
dane » Tue Aug 13, 2013 9:18 pm
Before voice was launched, we offered "dry pair" Fusion service without voice for $50.00. That's a savings of a couple dollars versus the offering today of $39.95 plus typical local, state and federal taxes and fees.
But it came with some challenges for us. Here are a few of them that come to mind right now:
If we "hot cut" your existing pair while porting in your telephone number, you are on proven copper. 50% of new Sonic.net customers come over from AT&T this way, and they have a seamless experience, a quality copper pair and high reliability. If you are provisioning a new "dry" pair, you're getting the available copper, which may be fine - or may not be.
If we hot cut the existing pair, we almost never need to make a visit to install the service, saving the customer the installation truck roll fee. Based upon our current actual cost for this, that's about $75 in savings we can pass on, so the extra couple dollars per month in taxes and fees would be weighed against this.
If there's no dial tone on a pair, field techs sometimes mistake it for available and will take the pair and use it for another customer.
...but, in California, if a carrier's equipment is "capable of providing 911 service", we have an obligation to provide it. The current Fusion product's infrastructure can deliver dialtone and emergency 911 capability, so we must provide at least that capability. This necessitates allocation of a telephone number, 911 database integration, all the e911 inter-tie, etc. A surprising amount of the cost of providing voice goes into 911 for us, and it's not something we could likely "save". (There's one way around this: we could deploy "dumb" cards that only did data, so the network wouldn't be capable for dry pair customers. But this requires totally different hardware in every CO, allocation to that hardware, etc - and then you could never in future turn ON voice for someone who wanted to add it.)
That's all I can think of right at this moment, as to why we retired the former $50 offering. Clearly, we could have kept it in some form, but our model has been moving more and more toward a "include everything, all circuits configured the same" model. This is a key point I suppose: a single product eases our sales, marketing and support burdens and allows us to reduce our costs. As sales, support and field installation is a huge share of the overhead in our products, simplification results in lower costs.
We had two paths to choose: ala carte, where we'd sell raw access for one low price, then nickle and dime all the various features, allowing customers to chose from the card whatever they specifically wanted. Maybe phone would be an extra $20 - even though it costs far less to add it on - shell, usenet, vpn, email, etc could also be unbundled.
But the complexity of going this route is huge, so we went totally the other direction: everything is bundled and included. Some people use less of one thing or another, and the costs and revenue are all blended. When more customers sign up and revenue increases, if margins go up with throw in more "free" stuff for everyone. We've got a roadmap that hopefully will bring more and more useful capabilities to the Fusion platform for all of you, as the customer base continues to grow.
