Friday, March 16, 2007

Verizon Dangles Bait. Will Fish Bite?


Verizon is dangling financial bait in front of returning or new customers. Consumers who have chosen to use cable phones, computer phones or wireless phones for their primary lines can now add the reliability and security of a Verizon landline to their household for $9.99 a month for a year. Win back programs are a staple of the competitive communications business, so the mere fact of a win back offer isn't surprising. Even the promotional price, though quite promotional, is unheard of.

The key element here is that Verizon is signaling that it has had enough of competitor poaching, and is prepared to halt the erosion, even at the price of destroying its POTS line margins. The prize now is shifting to lines in service. Broadband may be foundational, but a customer relationship is key to upselling other services. If that is POTS, so be it. The worse thing at this point is stranded assets, not margin off a POTS line, necessarily.

2 comments:

Anonymous said...

Verizon's efforts to unleash a ridiculous monthly price for land lines will damage many of its' competitors. Is Verizon about to become a monopoly? I think so.

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Anonymous said...

Wow, that is very low. They are going to try to demolish all high speed internet service providers. Verzon sucks at customer service though. We will see what happens.

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