What is wrong with Per-Seat UC Pricing Models?
As discussed in Part 1 of this 4 part series, most Service Providers are paying for their UC Platforms on a per-seat basis. Here, in Part 2, are the top three reasons why Service Providers looking to sell Unified Communications should avoid platform vendors using seat-based UC pricing models.
Watch Part 2 below, where Jason Byrne and Craig Galbraith discuss the downfalls of per-seat pricing.
1. ROI Suffers with Additional UC Features
At first glance, paying a fixed rate for every seat sounds simple. UC platform vendors will often offer a low initial rate to show potential ROI for Service Providers. However, this rate is only for the bare minimum of connectivity. A true Unified Communications solution is more than just a phone on every desk. Features like recording, conferencing, video, and call center have become the standard for SMBs and Enterprises. In most cases, the price per seat increases every time a new feature is added. Service Providers can say “goodbye” to their margins with every new line item.
2. Low Volume Seats Still Cost Full Price
If 10% of a company’s employees are heavy users of UC and the rest only answer a couple of calls per day, should you still have to pay full price for 100% of the employees? With per-seat UC pricing models, this is a reality that SPs often have to face. Even communal phones which are rarely used by the business sometimes count as a “seat”. When every seat is a rigid expense, it leaves very little flexibility when it comes to the pricing SPs pass on to their own clients. This leaves the Service Provider to decide between losing out on some of their margins or explaining to an angry customer why they will be charged for a phone that barely rings.
3. Traditional Seats Are Going Extinct
Per-seat pricing models make outdated assumptions when it comes to end-users. 2.7 billion people in the global workforce (80%) do not have a dedicated desk or seat in an office (Click to Tweet). This may seem like a high percentage to those of us in the technology space but entire industries are overlooked by seat-based UC pricing models. How are SPs supposed to sell UC services to manufacturing or agriculture verticals when their costs are still tied to the concept of every employee being tied to a desk?
The shift away from seats goes beyond industry verticals. According to Pew Research, 40% of American labor force participants were born after 1981. These employees have a different relationship with technology than previous generations which is causing a transformation in workplace communication. Intuitive user experiences, multi-channel communication, and mobility are demanded by these technology natives. Being tied down to a single desk and a single desk phone is being abandoned in favor of more flexibility across devices. UC pricing models with per-seat pricing simply can not keep up.
What is the alternative to seat-based UC pricing models?
Service Providers need a more modern UC pricing model for their UC Platform in order to serve today’s evolving work environments. netsapiens offers a pricing model based on the peak number of active sessions across your network. Session-based pricing gives SPs the flexibility to serve a wide range of businesses without sacrificing ROI. Learn more about our pricing model by downloading the following report:
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Pew Research Source: https://www.pewresearch.org/fact-tank/2018/04/11/millennials-largest-generation-us-labor-force/
