Dean Bubley points to a story in the UK about mobile contract defaults and the likelihood of it becoming a bigger problem in 2009. I can draw a comparison to the VoIP industry as well. Here’s why.
For the companies that provide a free ATA (Vonage, Packet8, Earthlink, etc.) in exchange for a contract commitment, that device carries a cost, plus the shipping and handling. Since they are rarely ever returned, they can’t be recycled to another user. Let’s figure they cost on a wholesale basis about $40.00 or so. Add in another $20 for shipping and handling and the company is at $60.00 of invested cost before they pay back. Figuring 12 months of service as the norm, that means if the customer goes disconnect within that time frame that cost has never been recovered. Sure the companies will say they allocate for bad debt, but I suspect thats a number which is going to be going up in 2009.
As a result, I think better options abound. ATA less SIP devices are one. Softphones are a second and most of all, having customers BYOD (Bring Your Own Device) which is something that Broadvoice has been doing for a while, as have many other VoIP companies.