Marlon , why the additive pricing for additional Gigs? Why wouldn't you just charge x$ per gig, since that is essentially what you are being charged by your upstream. If someone is using an average of 161 kbps constantly for a month, that sounds a lot like a T-1. Speakeasy is doing T-1s to the Internet for $399, others are doing SDSL at $250-299 per month, so if you are in the neighborhood, that should be expected. Anothe thing to think about is tiering your pricing

4 Gigs    $49
10 Gigs  $99
50 Gigs   $299

or something like that.

John Thomas


Marlon K. Schafer (509) 982-2181 wrote:
Hi All,

OK, so now that we know who our heavy users are I have to come up with a couple of things.

First, I have to figure out how many kbps a gig of download would be. Specifically, I've got a couple of customers doing 50 gigs per month. How many kbps does it take to generate that?

We pay for our internet based on kbps.

Next, what do we do for an overage fee? Currently it's set as $5 for the first gig, $10 for the second, $20 for the third etc. At 25 gigs the customer has a $5,000,000 bill. Sure that'll run off the abusers, but I'd rather find a more reasonable way to bill them.

We have a business customer that legitimately uses 40 to 50 gig per month. We just moved them from $75 to $350 per month (matched the t-1 price they pay in another town). They don't feel abused and I feel more comfortable about their usage. We bumped them up to 60 gigs included.

I have another customer that's at 10 gigs now (our included limit is 4). We talked about an appropriate rate of increase. Under our standard levels, they'd more than double their bill. If we hit them with a couple of hundred in billing they'd go elsewhere. We would, however, like to dig a little bit deeper into their back pocket. I talked with them a bit about our need to recover costs based on their usage etc.

They said if we hit $100 to $125 they'd not have a problem with that.

On our end we have two problems. One, we pay for internet based on usage. The more they use the more we pay. Our costs were up 15% last month. The other, maybe worse issue, is that we have to increase the capacity to towers that have heavy users on them. Possibly to the point of a dedicated ap to cover just a customer or three. Now we're really talking bucks and spectrum issues etc.

My original idea was that if a person went over by a gig or two we'd ding them a few dollars as a "shot across the bow" kind of thing. Around 50 of our 400 users are going over the new 4 gig level though. Some will fix that by getting postini and dropping the spam. Some will fix that by getting the kids to turn off the file sharing programs. And some are legitimately using that much data.

In the end, we don't want to run off people if we can help it. Those at the 30 to 50 gig level will probably leave us for other services, but that's gonna be ok. They mess things up for everyone around them. Better that my competitors have customers like that than we do. For all of the rest, we need to recover our costs, and hopefully make a little extra money on them.

Soooo, my new idea is, gigs 5 through 10 would be at $5 per month. Gigs 10 through 20 at $10 per gig. Over 20, call for a price and we'll work something out that works for all of us. We really need it to naturally hit around $350 at the 50 gig level to match what we did with the first big customer.

Thougths????

Marlon
(509) 982-2181                                   Equipment sales
(408) 907-6910 (Vonage)                    Consulting services
42846865 (icq)                                    And I run my own wisp!
[EMAIL PROTECTED]
www.odessaoffice.com/wireless
www.odessaoffice.com/marlon/cam





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