Thank you Elliot, A compelling piece I must admit, in which in short you tell us that Tucows will supply all their re-sellers need to be succesfull, all they need to do is be nice to the customers.
Of course every company, large, medium, small has their own plan, their own course and their own methods. For some registrations way heavily, for others they do not weigh in at much more than an add-on, But in the end it is not just the email add-on, and (not mentioned but readable between the lines) the hosting that you are now going to supply, in the end I think it is a cumulative result of all those little changed over the past years. Almost to many to mention but a few: the change of the discount procedure for mirrors, favoring first the bigger mirrors (hits and sites) and then the bigger registrars, then making it an exlcusive club. Making a statement that you would never get on "our" turf is something one should stick to, if not then one better have a more then compelling reason to do so and one should announce this way in advance as a matter of courtesy, to those that were there when you weren't what you are now, after all it is the early resellers that shaped the company as the resellers all keep on shaping Tucows and it's profitiblity. The circus with the certificates is all to recent, and sorry I have no other name for that, remembering that we have to explain this to our customers. The referral page another example and now this latest endeavour, where I do not mention the retraction of certain plans by Tucows because of the huge backlash it received from resellers. What seems to be forgotten is that in exchange for those (at first) favourable conditions (referral, discount, support) we have always been loyal, we being all your resellers. We have always seen this as a business agreement that on the one hand gave us the favourable conditions, with some exciting add-ons and on the other hand gave you a guaranteed good price for your domains. While changing the terms, as described in part above, you did not change the pricing policy, you expect(ed) us to still pay more then the market in exchange for less and less. The latest service add-on (email&hosting) is NOT for free, it has to be paid for and steep at that. Considering that if one runs imap 5 Mb of disk space is a decent day work. Zipping up the files ? Then why on earth use Imap. So again we have to pay for a service that several of your resellers do not appreciate, (ok we don't have to buy and I can tell you I really don't need them either, I can and already am selling hosting for far better prices then you are coming up with now, and an expertise on topic to support it)most don't need and a lot already sell. Which brings me back to that what you deny, you are levelling the playing field, making sure that "every tom dick & harry) can become a re-seller, all it takes is a few hundred dollar and you can even sell hosting. (250 downpayment, and another 200 to buy help setting it up) To me that is nothing more then supporting a HUGE (compared to my little company) conglomerate, in effect the largest registrar in the world to becoming a new V-word. Being a mirror, yes for me the mirror and OpenSRS are sill inter-related, is still something I am proud of, I appreciate Scott's ramblings about the family and the extreme hard work he puts in to keep it going in changing times. OpenSRS now for has become a normal, standard business deal, which I will have to judge on merits and as was said before, is only a back-end to a lot of middleware, something we worked on for quite some time, and in the light of that business deal I will have to look elsewhere more and more to get more out of it for my company. I know they all have less of a conciousness then Tucows does, though looking back that is not really backed up all the time by the course it is sailing but more by the people manning the sails, but that is something if known in advance, one can deal with. There are many ways to protect my customers from 3d parties, including the registrar. There remains a possibility to form our own group with other resellers to become and Inc (or Ltd) and become an accredited registrar. I was extrememly disspointed by this action and that sounded well through in my email, I hope to discuss this matter in Amsterdam should you so desire, but for now, after reading more reactions and thinking it over, I will move on with life and work, just in a slightly different matter, that I am sure would not even be noticed by Tucows, but to me makes all the difference. I will remain a mirror, not just because Scott owes me diner anyway :) and I still love being a mirror and not in the least because I just sold some add-space on my mirrors and I have to honour my word. I just don't like the path openSRS is going on now, and I will watch from aside to see it get back, or slide further, making sure it has as little impact on my work as possible. Thank you for taking the time to answer, thanks for taking the time to read. Kind regards Abel Wisman -----Original Message----- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]] On Behalf Of Elliot Noss Sent: 28 November 2002 22:25 To: discuss Subject: what we think To all: INTRODUCTION ============= I wanted to send an email message to all of you reviewing my thoughts on our relationship, your businesses and the future. Normally I like to talk in terms of "we" in my communication. Today I will often speak in the first person quite purposely. I note that our customers form such a heterogeneous group that it is difficult and dangerous to generalize, but I will do so to some extent here. It is the similarities, not the differences that are important. I apologize for the length. I have included headings to allow for easier skimming. What I will try and do in this message will be to provide context. I think it is important that you all understand the way we see you, what we think makes you successful, your place in our world, our view of our place in yours and how we think we can best help. To be clear upfront, help means help you win the battle for customers, to run and build successful businesses and to do it all in a way that can be enjoyed. First, let me thank you all for being involved with us. You are an amazing group of people who are in the main intelligent, thoughtful, know how to run a business and have a strong positive ethic. This last point is most brought home to me whenever we take the high road on an issue and you, as a group respond positively and in an appreciative fashion. I get the opportunity to interact with many of you and nothing makes me prouder than when you tell me what a great group of people we have. Believe me, it happens often, and it never fails to warm me. WHO YOU ARE =========== Often when describing who our customers are to third-parties I will conveniently say "small and medium-sized ISPs and web hosting companies". While this captures the two largest groups of customers, it doesn't describe nearly half of you. You are an incredibly heterogeneous group. You are located in over 110 countries around the World, can provide marketing and customer service in just about every conceivable language and have a great appreciation of your users issues. You innovate and problem-solve. The definition of a reseller that I find most accurate is "companies building recurring revenue streams over the IP network by providing Internet Services". What I most like about this definition is it captures the important fact that the services that are provided is a dynamic and changing set. This is extremely important in understanding what I view as our role as a supplier. GROWTH IN INTERNET SERVICES ============================ Going forward, I forsee huge growth in the market for Internet services. People's interaction with the Internet is on the cusp of exploding. I expect the number of personal web pages to increase dramatically. I expect personalized email to increase dramatically (spurred on by the recent moves by Yahoo, Hotmail and othersto limit free service). I expect the number and use of domain names to increase dramatically. All of these trends bode well. In addition, I expect a whole new raft of services to emerge. I cannot tell you if it will be music subscriptions, IP telephony or something none of us have yet conceived of, but I do expect a continuing stream of innovation. It has always been the case in the Internet economy, and IMHO, we are barely at the beginning. It is also extremely important to understand that in my view todays Internet Services become tomorrow's commodities. As an ISP in Toronto in 1995 the key differentiators were i) no busy signals ii) being able to provide good scripting for Trumpet Winsock iii) having a great library of init strings for those lovely 14.4 modems. The value of all of these things was gone within a couple of years. All of us in the Internet Services business have watched today's innovation become tomorrow's commodity. The only constants are innovation and the fact that these innovations make most users feel stupid. That is why customer service is, IMHO, the key to a successful Internet Services business. The provision of any technical service is about solving problems, not brand and not feature comparisons (think about how people sell hosting today and this point is especially stark, they sell it like it was a database circa 1993). There can be no bigger problem than "I don't get this!". Solve it, and keep solving it, and you have a customer for life. LONG-TERM OUR CUSTOMERS CAN AND SHOULD WIN ============================================ I believe that you all make up potentially the most powerful distribution network in the Internet economy. You each touch thousands of end-users who look to you for the most important Internet Services today. You have an ongoing financial relationship with your end-users and provide first-touch customer service. These last two characteristics combine to give you a unique ability to sell additional services to your end-users. In my view retail Internet Services businesses are about attracting and retaining customers. Marketing and customer service. This view comes from my years of doing it and years of supplying into it and watching who has won and who has lost. The biggest fallacy, IMHO, is that customer service for Internet Services is viewed as a commodity. Customer service is incredibly differentiable. Customer service is best served in small increments. It is not amenable to scale. Systems that help support customer service benefit from scale, but they are much less important than effort and attention. They also tend to be too far removed from understanding the real problem when employed by large companies. If you want to convince yourself of this point think about the customer service that you provide or that you believe many of the folks on this list provide. Now think of the customer service provided by telcos or cablecos or AOL or............ WHO OUR CUSTOMERS WILL BEAT ============================ It is clear to me that the competition here, in the near term, will be AOL, Microsoft and Yahoo. The good news is they have little to no idea they are competing with you, and even if they did they would neither fear nor respect you. This is always an advantage when competing, believe me. It should also give you confidence in that two of the three are known for poor customer service and the third has never provided any. WHY OUR CUSTOMERS WILL BEAT THEM ================================= I believe our most successful customers are those that focus on attracting and retaining customers. Thus, marketing and customer service. I know many of you have different businesses and business models, so please do not take any of this to be exhaustive. I generalize quite conciously here. Great customer service leads to high customer retention ratios ("CRR"). Great customer service leads to a higher degree of word-of-mouth customer acquisition and word-of-mouth customer acquisition costs nothing. The more of this you have the lower your customer acquisition cost ("CAC"). One thing I know for sure, any Internet service retailer that has a relatively low CAC and a relatively high CRR will be very successful. This is easy. If you manage to these two variables, either explicitly or implicitly, and you do well at them you will win. By being closer to your customers you will provide better customer service. This may be because of unique language needs. It may be because of unique usage needs. It may be because of persoanl relationships. There are countless reasons. I do know that the closer you are to your customers, the better you will appreciate their problems, the more you are able to solve them. This is simply innovation existing at the edge of the network. This is the beauty of the Internet. WHAT WE DO, WHAT YOU DO ======================== So here is the meat of the issue. If you are in agreement with the general thesis above than the below will hold together well for you. What we do is manage data for you and simplify complex business processes while providing a high-level of customer service around the tools we provide. We provide tools that are hopefully infrastructure or building blocks as parts of Internet services, but not "finished goods" in and of themselves. For instance, it is extremely difficult, bordering on impossible for an end-user to become a reseller for their own purposes unless their volumes are very high and their level of technical sophistication or access to same is also very high. Virtually all of our wholesale domain registration competitors offer "plug-and-play" solutions where they often take the credit card and provide end-user customer service. This makes no sense to me, for us, if you play it back against the thesis above. I am unclear as to what value-add those resellers could really provide to their customers in the long run. Therefore I am unclear as to what they could provide as business partners for us in the long run. There are many elements of your businesses that can and should be thought of as repititive, best centralized and therefore prone to outsourcing. This obviously applies to many elements of domain registration like base renewal messaging functionality or implementing a new registry protocol. Why should 5,000 people do this when it can be done once and generalized. That is efficiency. I love to think about spam filters like this. Spam filters are not about brilliant technology, but are about keeping a constantly evolving set of rules fresh and updated. 5,000 companies need not do this. Imagine a service built on Spam Assassin rules as a base and supplemented by the experiences of the 30-40 million end users that we collectively reach. Now that is magic. We should enter areas where we can provide value based upon the above-noted premises (manage data and simplify complex business processes) as well as where we can bring scale to pricing or regulatory issues. This does NOT mean we will neglect important innovation or functionality in our core domain services. It does mean that we need to do everything we can to help you all maximize your customer relationships and build long-term businesses for yourselves. That is what we do. You in turn provide your end-users with the highest level of service possible. Internet services are not dial-tone. They are complex and becoming moreso. End-users interaction with the Internet is not simplifying, but is instead becoming more complex. Complexity requires service. It needs love and care and you all can provide that. This is why the markets for web services have NOT been dominated by large telcos and cablecos, but are instead all empirically extremely competitive markets. I will expand a bit in the next section on what this means and what it doesn't. To me, the most important point is you have the opportunity to be extremely close to your customers and to know what their specific issues are. This means you have the greatest ability to address them. Remember that today most users (individuals and businesses) have multiple suppliers of Internet Services. You need to be the one that is thought of as the "problem solver". Sometimes this may seem thankless, in fact often it is thankless, but it is also the role that makes you indispensible. This is what guarantees not just your survival, but your success. "MARKETING" and "CUSTOMER SERVICE" VS "TECHNOLOGY" =================================================== I want to direct special attention to a point that I felt was implicit in a few of the initial comments about our new email service which seemed to imply that I felt that your role was to answer the phones, smile and be nice. I spent many words above talking about marketing and customer service. Let me be as clear as I can be. I do NOT in any way suggest that this obviates the need for technical skill on your part. It does not "level the playing field" for any "Tom, Dick or Harry" to offer services. Many of our competitors do this with their "insert logo here" offerings. We are not really looking for those folks as long-term customers. I would strongly argue that the points I make above infer a PREMIUM on technical proficiency. Let me be more specific. It is the case with Internet services that things that are magical today become commodities or irrelevant tomorrow (see the Trumpet Winsock example above). Things are innovative in these marketplaces ever so briefly. You guys have to be the ones running at the front of the pack. It is the case that there has been virtually NO significant innovation in the marketing of domains or web hosting in the last 24 months. There has certainly been some evolution, but nothing that looks like revolution. This is astonishing. To me, if Tucows is removing the need for you to run a mail server and operate spam filters, for instance, that time can now be spent working on the following: - what other services can I include in a standard domain name or hosting package that provides more value to end users? - what tools can I create that will incent my customers to make more use of their domain name/email box/website (because usage is the greatest determinant of renewal)? - what tools can I employ to help me interact more with my customers so I can better understand their problems? - what tools can I employ to either make my direct marketing more effective or to allow me to get started with some direct marketing (think here about measuring conversion and numerous other variables and think about Overture and Google and local and....)? - what tools can I push out to my customers that will reduce my customer service costs and increase my customer satisfaction? and there is of course much more. Any of you who say "I don't need to do any of that or don't want to do any of that" are fooling yourselves. That is where the winners and the losers will be determined. There will be elements of the above that we can and will assist with, but again it will be in the form of tools (think about useful data that will make some of the above tasks easier) that you will need to supplement. We need you to deal with local language, local marketing, currency and taking payments, helping us understand and respond to local issues (and this is local as opposed to global not national or regional). These are all non-trivial. I really want all of you to be able to look at a new service like email and say "great, I can offload this burden and spend more of my time innovating and differentiating". I know that I am both a purist and an optimist, but such is my curse. DISCUSS-LIST AND NEED FOR ALTERNATIVE CHANNELS =============================================== I do want to talk a bit about discuss-list and other means of communication. First, I am perhaps the luckiest CEO in the World in that I am able to see every day what my customers are thinking about in real-time. This is a huge benefit. I appreciate that any list has its share of lurkers and folks who are very vocal. This is simply a filter that need be placed on the data. The list is an invaluable resource to me and the rest of the folks here, as well as to all of you IMHO. That being said, it is now a much broader community than simply OpenSRS resellers. Most every competitor, competitors customers, suppliers, registries, regulators, press, analyst and other folks interested in DNS issues now either subscribes to the list or reads it in archive form. That can make communication a little bit more challenging for us. We need to find a way to keep the list the vibrant community and resource for our customers that it is, while finding a way to discuss other issues in a more discrete environment. With email, we engaged in surveys, held focus groups at a few different stages and had a number of one-on-one discussions. We plan to do much more "offlist" communications going forward. This is not to replace the list, but to supplement it. If you EVER want to be more involved or more aware of any issues I encourage you to speak to an account rep to and let them know you want to do focus groups or simply to have a dialogue. CONCLUSION ============ I want to stress that the comments above are truly macro comments. We have thousands of customers so I have no choice but to generalize. There are of course exceptions. This is akin to someone being a great golfer with an unconventional style. Please take these comments in that spirit. They are macro not micro. Many, if not most of you are able to do work you enjoy on your own terms. You are able to help many people, employ others and make a good living while doing it. Anyone in this situation is indeed very lucky. I know I feel lucky. There is no question in my mind that an entity providing a full suite of web services to a few thousand people is a viable business and can support a nice life. I believe, we believe, that you can win the battle for the hearts, minds and wallets of end-users. Our role is to bring some of the elements of scale to you so you can compete on a more even footing. I am very excited about the future. I have seen extremely positive signs in the last little while that lead me to believe you will all be able to expect an even higher level of service and innovation than you have received to date. Remember that while Tucows has been around a long time as a business, OpenSRS and Internet services are still relatively new (a couple months away from celebrating its third birthday).We all truly believe that our business is simply an extension of yours. By thinking about the health of your business we are taking care of ours. While I know all of you will not agree with the above, I hope it will at least help you understand our thinking. As always, please pile on with comments. Thanks again for being part of us. Regards Elliot Noss Tucows inc. 416-538-5494
