I’ve been a Ringcentral customer for over 5 years for my business voip (1800 number, voicemail). The pricing was a bit high at $45 per month, but the feature set was generous at the time. Last summer, these asshats sent me an email about them being an awesome company and a bunch of bullshit, ending on the news that they were moving me to a more expensive plan. I ended up paying something like $85/month. WTF! The cost of VOIP is going down, not up. I knew I could get the same service from other companies like Grasshopper or Evoice for less than $15/month. This amounts to a difference of about $900 per year.
These greedy bastards are capitalizing on the fact that we are lazy and will not take action. I decided today (8 months later) that I was done with Ringcentral. I’m moving to eVoice. Moving a phone number is a tedious task. You have to print, fill, sign and scan forms to request the transfer. Than the company you leave will drag their feet and try to convince you to stay.
An Interesting Business Lesson
I think Ringcentral are assholes. However this little stunt of doubling their pricing on old customers was probably very profitable. Most of their business customers are too busy to deal with something as small as that. Yet they probably nearly doubled their monthly ARPU on their legacy users and they must have lost less than 5% of their user. They probably have several thousands of users with now jacked up pricing. This move quite possibly may have doubled their profit, at basically zero cost. This is very interesting if you have some kind of subscription business where the customers are businesses.
One could possibly acquire a subscription business at a X multiple of profit, jack up the pricing, and then quickly sell back the business for the same multiple of the now doubled profit…Thus doubling the initial investment. I recently bought a business and quickly sold it off for double the price paid and I must say that I liked it. Maybe there is a valid business flipping strategy here.