Thursday, January 15, 2009

Prepaid is Dead, redux.

I just saw this in the news today:

Boost sees $50 unlimited plan battling Leap, Metro

Unlimited calling and texting for US$50/month. It's a race to the bottom with all-you-can-eat plans.

If you're charging per minute, per sms, per byte, the question is "why?". Save yourself a lot of money and quit billing for the core service! That Intec Billing Engine you're thinking of buying? Get rid of it, or use it for something other than charging for calls.


Determinist said...

You've been saying this for years. While I think that ultimately, it will be the final result, there is probably a decade of money to be made in charging services.

We can bet a dollar on it... game?

Jason Pollock said...

As with any software, there will always be money to be made. Just look at Cobol. There's still money to be made there too.

Real Time Charging and SMS are cash cows. That doesn't mean they are growing markets! For proof, you only have to ask yourself:

"Has anyone sold any real time billing systems in Europe and/or North America in the past 5 years? Tier 1 providers? Tier 2, Tier 3?"

I think you'll find that the only sales have been to new Tier 3 entrants, and forced upgrades to existing services.

All other sales have been to third world countries where they are only just installing mobile systems. Lots of growth, not a lot of profit.

Relying on your cash cow to provide a future for your business will just result in your business becoming irrelevant.

When you find yourself in possession of a product that is a cash cow, you milk it. You don't put any more money into it, you take money _out_.

Real Time Charging and SMS are both such services.