In years gone by, telcos could have been forgiven for losing money on their consumer email platforms; email was not their priority, and they did not know any better. But times have changed. There is now enough evidence from competitors to know that consumers do value email and will pay for it; all you have to do is ask.
Whilst a telco’s core business is (and should be) still focussed on its infrastructure, broadband, and telephony drawcards, telcos should not be losing money on their consumer email platforms; there is a better way. To help illustrate this assertion, we’d like to share three case studies of atmail customers.
Case Study 1
The first case study is for a telco with less than 30,000 mailboxes. When they came to us, they were losing money on email, but knew they could turn this around with a little external help.
With an outdated webmail experience, their first request was for a modern, new-look webmail, to improve their end user’s email experience.
Next, with insufficient internal capability to scale their email platform as fast as their company was growing, their second request was for an externally hosted, reliable, cloud email platform.
Third, they were committed to premium antispam, to solve their spam headache and to protect their revamped platform.
Transitioning to subscription
Now more confident in their email offering, this telco introduced a simple subscription pricing model for email, which required consumers to start paying (only) $1 per month.
The result? This telco experienced less than 5 percent churn, and has now turned their email platform around from a cost centre to a profit centre. All thanks to $1 a month.
Their business team is happier, because profits are up, and they are now exploring email upsell options (including a specific SMB email package). Their technical team is happier, because they can better focus on core business and not worry about email spam issues. And their customers are happier, because the user experience is more modern, intuitive, and spam protected.
Case Study 2
The second case study is for a telco with more than 100,000 mailboxes. When they came to us, they had been losing money on consumer email, and their email software and hardware systems were approaching end of life (EOL).
Thankfully, they did not shut down their email platform. Instead, they invested in a modern, cloud-hosted, webmail experience, to give email another chance.
Transitioning to subscription
Their email pricing strategy was twofold:
- Keep high value customers on a free email package;
- Transition their remaining email customers to a subscription package circa $5 per month, at the time of a customer’s annual renewal.
The result? This telco experienced very low churn from the customers asked to pay for their email subscription at annual renewal, and they now generate healthy profits from the 30 percent of their 100,000+ email customers who have transitioned to their $5 per month model.
Case Study 3
Our third case study is a telco with circa 500,000 (on-premises) email customers. Unlike our first two case studies, the profitability strategy of this telco was to insert advertising into their webmail, rather than adopt a customer subscription model.
The result? This telco made $1 million in advertising revenue from consumer email in their first year alone; which equates to $2 per user per year. Whilst it sounds impressive, imagine how much revenue they would have generated if they had implemented a consumer email subscription option that charged $2 per user per month.
Interested in more case studies?
We invite you to contact us here if you’d like to see more customer case studies and/or learn insights from our recent global research study of telco, ISP and hosting provider email pricing.
New to atmail?
atmail is an email solutions company with 22 years of global, email expertise. You can trust us to deliver an email hosting platform that is secure, stable and scalable. We power more than 170 million mailboxes worldwide and offer modern, white-labelled, cloud hosted email with your choice of US or (GDPR compliant) EU data centres. We also offer on-premises webmail and/or mail server options.