| I think Verizon's market analysis told them they'd have a few takers for their $15 DSL. Instead, they got a flood of new subscribers--too many for them to even handle adequately. I think their only analysis for FiOS subscriptions is a cost/benefit analysis: they figure right now that the only acceptable return on investment for each subscriber is at least $40. The thing is, they also say they're going to drop support for copper, leaving only FiOS connections even if all you have is phone service (though they don't really say when they'll reach this stage). At this point, $15 vs. $0 might sound like a good return on investment--something is better than nothing. What they're betting is that the triple-play (or at least the double-play) will bring in everyone eventually. I think it's a mistake--a financial mistake--to ignore a large portion of your potential subscriber base in the hopes of forcing a larger return. Nobody who really wants broadband is going to go for a 768/128 connection; nobody who doesn't really care about the speed of their Internet connection versus the money in their pocket is going to go for $40 Internet, or even $30--most people's lives do not revolve around Internet access; and a lot of people are satisfied with OTA TV and a trip to the video store, or Netflix. Having no economy tier is losing Verizon potential subscribers and potential revenue. The first rule of marketing is still "make 'em a customer first, then sell 'em more stuff". |
