Costs versus Adoption rates - Impact on VoIP Service Providers

While at VON this past Sept - I was part of a very interesting discussion around the costs that the SP needs to bear to supply technologies, and comparing the cost to the adoption rate of the technology. There main point of the conversation brought to the table by Greg Cook is that the adoption rate of the technology is not consistent with the cost and pricing models that are employed by the SP. Following this argument, the real reason there are not numerous SPs making real money at VoIP-based offering is not so much that the technology is not wanted, or not of good quality, but more that the pricing/scaling models are out of whack with the adoption rates. The point that the diagram is making, using collaboration as the offering, is that 50% of the total cost is going into an offering that is only being adopted by 10% of the subscriber base. In order for a model like this to work, a tiered approach to the pricing model would have to be developed. Without that tiered pricing model, the business case has no foundation. What is happening more and more is the bundling of services at a flat rate, and unless that flat rate covers the costs appropriately, then it can be seen as nothing more than a market-grabbing exercise. There better be a strong cash foundation to a company that employs such models.

Adam "voiploser" Uzelac