Reviewing Minimum Spend on Startup and Developer Accounts

 

By Simon Woodhead

Startup accounts

It is twelve months since we increased our wholesale minimum spend on Startup accounts from £100 to £250 per month and time to review it again. 

Our rationale for the increase last year was that for proper wholesale business, this amount should be easily affordable and we now have more suitable service options where it isn’t, or isn’t likely to be. Over the year we’ve dramatically reduced call charges and we want to be able to continue on that trajectory. The alternative is to charge you to access numbering, to charge you for 999, to charge you for trunk balances etc. etc. all of which when compared to competitors add up to more than our minimum before you’ve actually consumed anything. Instead, we give you super-keen utility-based pricing on the components you need, protected by a minimum spend that can be achieved by any mix of our wholesale services, from termination through to connectivity. That feels fair to me!

We signalled last year that amongst other wholesale operators who work this way, £500 a month was a more typical level. That remains the level that feels about right and the reality is that the overhead in servicing an account is unaffected by the size of the invoice, but rather the level of support required. The sad reality is that a support ticket for a customer spending 50p a month costs as much to process as for a customer spending £100k a month; the further sad reality is that generally the customer spending 50p will open far more support tickets. On that basis, it would be really easy to conclude that we should set a minimum spend of something like £5,000 a month and service fewer accounts more profitably. That is the sane commercial interpretation of it and indeed we deal with carriers in the marketplace that have a £50k a month minimum spend for similar reasons.

However, every large customer was at one time small and we’re hugely grateful to the number of small customers we have that we literally never hear from in a support context. We built our business on servicing those who knew what they were doing (our definition of wholesale) and we have absolutely no wish to punish their loyalty and competence. But we do absolutely need to avoid providing retail support at wholesale prices, either to your customers or the army of people jumping ship elsewhere and wanting to cut out a middle-man who was adding value they don’t want to pay for; the minimum spend achieves that somewhat.

So, having made our case for increasing it to £500, we’re actually not going to! It will remain at £250 for the next twelve months for all Startup accounts despite the efforts we’re expending in order to make call costs at this entry level competitive with other operators’ higher tiers!

But we’re going to go a stage further, as we genuinely want all accounts to develop, particularly in these times which are either a huge opportunity or simply awful, depending on how your business is focused. Previously we have waived our 1p minimum spend for those of you committing to £1k per month of minimum spend. Today we’re reducing that to £500, i.e. for those committing to a new 12 month minimum spend of £500 per month, we will waive the 1p minimum call charge. We hope this’ll help those of you with traffic elsewhere, often at higher prices or lower quality. Please speak to Frazer or his team to put this in place.

Developer accounts

Developer accounts are not for production use. We’ve been very clear about that and it is even in our MSA. Thus they don’t support porting and should not be used to provide services to end users. Sadly, one problem we’ve always had is people ignoring that.

In trying to combat that abuse we’ve done a few things, one of which was last year’s £50 minimum spend, fully refundable to those upgrading to Startup in a reasonable time period. With hindsight, whilst that flushed out a few scrotes, it was a mistake and overcomplicates things to the detriment of the very people the Developer account is intended for – those new customers wanting to integrate with our API and try things out, or the army of community friends who want to use Simwood in presentations and demos.

So, effective July 1st, the minimum spend is being waived for Developer accounts and so they will be free! You will still be charged for any components such as chargeable numbering, and need to maintain a balance for call charges but there’ll be no uplift. 

The reason for this change being notified and not effective immediately is to put those who may be abusing this account on notice. Effective July 1st, every call in and out of a developer account will have a whisper played to all parties reminding them that this is a non-production developer account. We hope this’ll do the trick.

Absent abuse, we can manually vary any of the limits on the developer account including disabling this message. We’ll do so for people we know and, entirely at our discretion, for those with a valid technical argument for doing so. For 99% of test scenarios however, this quiet message will not impede legitimate use of the account for development and testing purposes.

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So no minimum spend increase, waiving the minimum spend for developers, and making the removal of the 1p minimum call charge more accessible. All while calls are 97% cheaper than elsewhere and you’re not paying sneaky fees for things like 999 or numbering!