Thursday, December 30. 2010Two Days To Go......John Linton ....too much work to be crammed in to two days. We finished almost all of the revised residential ADSL offerings for new users yesterday with the only decision left to make being what, if anything, we do about Telstra ADSL2. My view is that we should no longer offer it because the 'promised' price reductions never eventuated and I, personally, see no advantages in offering a service we buy wholesale that is higher priced to the end customer than Telstra Retail offers the same service - a ridiculous anomaly in any sensible view of commerce. However other views are that Telstra's 24 month contracts and other requirements actually render their head line pricing a 'trap' for the unthinking and there is a market for more thoughtful buyers. We will look at those views again later today and I am pretty sure that my views will not prevail. We will start finalising any 'special' offers for our current customers later today starting with the offer to our current 'naked' users to restore their telephone line to a working PSTN service at no charge to them if they sign up for a new 12 month contract. There has always been this stupidity in pricing of 'naked' ADSL services in that the cost of a 'naked' service is only two or three dollars less than an ADSL service with a working telephone line. I can't remember now how we were ever persuaded that providing a naked' service was ever a good idea in the first place but it is a really stupid concept that is hard to implement and even harder for an end user to change providers once the line has been 'crippled'. In offering our 'naked' customers the chance to change their 'crippled' line back to a full service line at no cost to them we think that will be a very good thing to do. It will be interesting to see whether our 'naked' customers agree. At least one of our carrier suppliers continues to be interested in improving their offers to us but, as always, they remain firmly grounded in acquiring 'new net add customers' which make such offers almost useless in today's marketplaces. I would have thought that it must be quite obvious by now, even to the dullest minds with a zero knowledge of the markets, that once a residential market is 'saturated' the retention of current customers becomes an overwhelming issue that dwarfs the concepts of taking customers away from other suppliers....but apparently that is not the case, or if it is I can't grasp the basis of the views they hold. I can't see a way of utilising the latest new customer acquisition offers which may just mean my mind is too tired from trying to make sense of the various inputs we have been dealing with in coming up with sensible ways to approach 2011 - maybe we're just 'punch drunk' from dealing with the ever more complex events of 2010? This article sums up the last five years of wire line/ADSL pricing issues fairly well: http://www.smh.com.au/business/behind-the-no-to-telstras-flat-30-20101229-19a8q.html You should be able to see why the past two years have been such a waste of time in most respects.There really is no place for a company like Exetel in residential marketplaces that have become so incredibly embroiled in political points scoring by people who haven't got the slightest interest in delivering value for money services but only in raping and looting to their own personal advantages. Maybe I shouldn't make any decisions today as my personal mood is severely darkened by the advice from our vet at 6.30 am that our small dog who has been an integral part of our family's life for the past 15 years may well have to be 'put down' later this morning if the tumor they found last night proves to be inoperable. I have loved dogs all my life but I have never been able to sensibly deal with these inevitable moments. Copyright © Exetel Pty Ltd 2010 Trackbacks
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Hi John,
On Monday you wrote about an idea for changing the existing out of contract customers. "Increase all ADSL2 Optus Bundled plans by $X.00 and include $10.00 worth of local and national calls and calls to Optus mobiles in the increased price. In addition offer the choice of bundling a low cost mobile plan which will provide a $10.00 discount to the current ADSL plan" Would this type of plan work against any revenue you get from your VoIP customers? ie. if I get $10 free local/national/mobile calls on my OPTUS PSTN, I would use that instead of VoIP, surely this is just moving the problem. Also if I am a customer that has already taken up the offer of an OPTUS/EXETEL mobile CAP phone (in my case two) that bonus is already built into my costs..... Another comment I would like to make. Is it possible to build a little more 'fat' into your profit, to help ride the ups and downs so you don't have to make so many changes throughout the year? Currently your customers spend weeks deciding which ISP to sign up with only to find that the deals have changed within days of signing up, and then having to re-evaluate the worth of the deal. I think people like to 'set and forget'. I know you like to pass on your savings straight away to your customers, but recently there have been too many examples of a price decrease or download increase which is followed the next month by price rises. This is a very complex set of decisions, I do not envy your job here. Merry Christmas, Happy New Year. Lawrie. Comments (2)
Someone who signs for an Exetel plan does not have to 'worry about' their plan until the end of their contract.
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It is not just new customers but your existing customers, that move to new plans.
For Example, in my case I moved from one out-of-contract plan to another out-of-contract plan only two months ago. Since then the options available to existing customers has changed once, and the options to new customers has changed at least twice. I think within days of me changing from a 10G plan to a 20G plan, my downloads increased to 50G and now you need to charge me more. I did not ask for the extra 30G but as you cant cover the cost you have to increase my plan.... I know there is no conspiracy theory here, you are genuinely offering the best deal you can day by day, I think some customers would be happy that you offered the best deal month by month or even year by year. ie don't fly by the seat of your pants so much. I read your blog daily, I monitor the prices of plans weekly and get to understand why you are doing things. Not everyone see this and understands, and as such Exetel remains a mystery to them. Also you did not answer my question about lost VoIP revenue. Lawrie. Comments (2)
It would be much easier for me, Exetel and life in general if I didn't take the time early each morning to write about the issues confronting communications businesses of Exetel's size.
Perhaps I am wrong to make the assumption that what I write will be of interest to the people who read it? Losing VoIP revenue by offering free calls is a simple progression of very tough marketplaces. If we didn't offer the very best we can at all times we would lose more customers than we already do to other suppliers who choose to give those benefits to their customers. I am really, really tired now and perhaps what I write is not as clear as it should be. Comments (4)
First off, I am sorry for your personal situation with your family dog -- I know how that feels.
In terms of Exetel/Telstra ADSL2, well you know where I stand, I can't have said more than enough on that overall and many others are giving you the same or similar reasons that I've given over time. However, your push to bundle things seems to be making Exetel another Telstra or Optus in some ways ... I know that sounds tough, but you need to realize that sometimes people have little choice on their mobiles as "work" pays for them and / or requires them to use a specific network; there is also the fact that at some locations, one network is better than the others. Home and personal services may be different, but there is no guarantee that a customer can see value in the CAP plans. Also, I understand that a great many people choose cap plans over other options for all sorts of reasons, but for the low phone user, a cap plan is often too expensive in reality. Fortunately for some low volume mobile users, like myself, they can use the BUSMA plan (requiring an ABN). Like yourself, I only use mobiles when I need to and I use VoIP most of the time. It terms of customer's plan changes, forced or otherwise, it has not been uncommon for users to "gain" more un-usable features/downloads for them and get those at a lower cost, then to find the price moves upwards anyway -- just as Laurie has mentioned. And there is also the huge problem of new customers being able to get better deals than existing customers -- I wish you would be able to iron that problem out, even if it means averaging the benefits of new customers across all customers; without averaging, it will always seem unfair to existing customers whom cannot change to a better/cheaper plan without going elsewhere and coming back as a churn or as a new customer.... Comment (1)
The reality is that Telstra Retail has forever changed the residential ADSL business.
I wish things were the same as in January 2004 - but they aren't. The real question is whether a company like Exetel has any place in the residential market at all in 2011. We have just about finished the formulation of Exetel's residential ADSL offers now - most plans will beon the web site and the user facilities today or tomorrow. As expected, I lost the decision to no longer offer TW ADSL2 plans but then I was always going to. There are no longer any disparities between new user and current user pricing options (except for current 'naked' users) - that has just made everything a little more expensive - our carrier suppliers really do see new users as being more important than 'old' users - again, that's a fact of life. Comments (4)
The short contracts are still a good selling point
Comment (1)
They are.
Also the fastest telephone call and email response time and the highly qualified support personnel and the network full provisioning and.... Comments (4)
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