[JA] Re: E-mail was meant to be free
- From: George H Lunt <glunt@xxxxxxxx>
- To: juno_accmail@xxxxxxxxxxxxx
- Date: Wed, 15 Aug 2001 18:56:24 -0700
On Wed, 15 Aug 2001 thepccat@xxxxxxxx writes:
>
> [1] Where can I apply to get back some of the $100 they spent
> winning this account ;-)?
Hi PC Cat, and All,
Ha, ha... have to pry it out of the hands of some newspaper, radio and
magazine media types I'd guess. Never saw hardly any of the couple
hundred million they spent on advertising myself.
> [2] What evidence do you have that they will collapse like a house
> of cards in a week due to huge loss in subscriber numbers? More likely
> many people will drag out the credit cards or checkbooks and become
> subscribers. Remember the "huge loss of subscribers" which took
> place when Juno placed de facto limits on Internet usage in order to
clear
> out the "heavy users?" That purge sure hurt Juno ;-).
Evidence? Now you put me on the spot. I would have just gone with
"common sense", but I can see from the rest of that paragraph that you're
serious. Not sure who suggested a "huge loss of subscribers" from the
changes when they began implementing "the big squeeze" back in December,
but as Juno had said they were only aiming to curtail the usage of the 5%
of heavy users, I wouldn't have thought the "number of subscribers" would
drop more significantly than that, would you?
But what the heck, let's do take a look at a couple of the numbers, shall
we? In the December annual/quarterly report, Juno reported 4.0 million
"active" subscribers which they define as ALL premium service customers,
plus those using either of the free services, e-mail or the Internet
service. And just for the record they also state that 90% of these users
had web access. Which I guess means 10% just used the e-mail service.
Anyway, back to our 5% of heavy users. That's 4.0 million active
subscribers less 5% equals 3.8 million. Checking the level of
subscribers we find just 3.3 million... huh? Down 17.5%! But then maybe
you don't think 700,000 fewer active subscribers is significant... I
don't know.
And how many of those 3.3 million remaining rushed to their checkbooks to
save their surfing experience... that would be December billable
customers, 842,000, June billable customer, 884,000... so that's 42,000
new billable subscribers with a loss of 700,000 subscribers.
But boy was Juno ever right about those 5% of users spending all their
dough. Operating costs for the 3.16 (4.0m less 842k) million free riders
in December cost them $10.9 million ($3.45), while the remaining 2.42
(3.3m less 884k) million free riders only spent $3.95 million ($1.63
each).
I think we have to assume that most of the 400,000 free e-mail'ers
(remember, 10% of 4 million active subscribers in December) have probably
stuck around, why would they leave if Juno cut back the Free Internet
Service? They weren't using it anyway... but how many will if they have
to pay $9.95 a month for their e-mail? Of all the numbers that might be
a surprise, I think this one may be the biggest unknown.
Of the 2 million active free "web surfing" subscribers left in June
(2.42m active subs less the 400,000 e-mail only'ers) how many do you
actually think will rush for their wallets? Personally, I think many
already have other access and keep their Juno accounts "just because".
Juno has already driven off the serious surfers, retaining only 42,000 of
700,000... and as the remaining users are extremely "light users",
remember, Juno ran off 17.5% of its users, but experienced a 64%
reduction in telecommunications costs ($10.9 to $3.95 million) have had
their access time curtailed WITHOUT rushing for their wallets, I think is
a pretty good indicator they're not going to... not en masse, that's for
sure. It also indicates to me that many of those who use Juno to access
the web, do so more on a lark, using the service primarily for e-mail...
which is by far, cheaper for Juno. And I also think Juno has irritated
the heck out of many and I don't think they'll respond well to the "pay
up or get the heck out" message coming down the road.
Might as well throw that this is another reason I think Juno may continue
to supply free e-mail. It's the ONLY way I see them saving these numbers.
If they cut the free e-mail, I see many of the free e-mailers heading
down the road. And while you could make an argument for not switching
horses in mid-stream, I think there will be plenty of Juno surfers
willing to brave the icy waters... unless they can "fallback" to just
free e-mail.
And finally (aren't you glad), I just see a huge difference in telling
somebody, "OK, we're going to cut back on your free surfing, but we're
still going to let you keep your free e-mail accounts" which is what they
said in December, and soon it's going to be "It's either $9.95 a month
(per account mind you) or we're blowing all your accounts to
smithereens". Some will, of course, go for their spiel and why not?
They're far from the worst ISP in the world... and pretty darn cheap...
they, and Netzero, as United Online, will make a great "also ran". But
#2? Don't make me laugh. I just don't think the hoards are going to
materialize at the new paid subscriber window.
George Lunt ..... so. cal.
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