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 Fewer than one in twenty consumers buy bonded. Dane Jasper brought the price of two lines bonded down from $80 to $70 but consumers just didn't bite. On the other hand, businesses are buying the double line DSL, two unlimited phone line offering. Sonic.net has now simplified their offering. Consumers get "up to 24 meg" DSL and unlimited voice with full features for ~$40. Business get double speeds and two full-featured phone lines for ~$90. Typical download speeds are 5-15 megabits for one line and 10-30 megabits for two.
Bonding two pair works, generally doubling speed at the cost of using a second copper pair, another dslam port and a fancier modem at home. The service generally performed well although there were some inside wiring problems. If you're a telco with loads of unused copper, bonding may be an attractive product. A competitor like California's Sonic.net has to pay the telco for each line and needs to charge much more, however.
Dane blogged that some customers with long loops were buying the two line service hoping for much higher speeds and were disappointed. There's no magic here. If you only get a few megabits with a single loop, even doubling the speed with bonding doesn't bring you close to 20 megabits. Customers were disappointed and cancelled service. Dane is an unusual CEO; his blog suggested those homes should probably look to his cable competitor. For businesses he's continuing to sell the two line service for $90, including a ZyXel modem. The second phone line makes that offering attractive.
Many pair bonding over moderate loop lengths is proving an attractive offering for business, generally sold as "carrier ethernet" at a price of several hundred dollars. Use 4-10 pair and speeds of 50 and even 100 megabits are obtainable to many locations. This is very attractive where running fiber is too expensive. Qwest and many others have made this a standard offering.
Apple's pared down product line is the current fashion and certainly reduces costs. Xavier Niel proved that in telecom, making the 30 euro triple play virtually his exclusive offering and doing extremely well. The streamlined operation helps Free make money at much lower prices. The telco norm is to pile on the extras. Randall Stephenson told Wall Street, "Don't look at our advertised price. That's just to bring them in. Pay attention instead to ARPU, the average revenue per user."
Bait and switch, anyone?
1994: Sonic.net was founded in a small sun room in the back of this home in Santa Rosa.
Fusion Product Changes
March 1, 2012 – 5:31 pm
Today we have made changes to our Fusion service in order to further simplify the product, to improve service delivery, and to lower costs.
Previously Fusion was a bit confusing – it’s one product, but was offered four different ways: residential single-line, residential dual-line, business single-line and business dual-line. This meant four different price points, and business users basically paid more for less: a $10 to $20 higher monthly fee, plus a penny a minute for all their calls. (More on this below!)
We have also found that residential dual-line service was rarely purchased, with only one out of twenty customers selecting this product. When it was, there were more delivery challenges due to the household wiring, and more cancellations due to delivered speed concerns.
We often found that these residential customers didn’t actually want the two phone lines, and instead were hoping for more speed, generally seeking 20-40Mbps. While bonded Fusion is double the speed of a single line, it was sometimes being purchased by folks located at longer much longer distances who were desperate for more performance. For a speed-hungry consumer on a very long loop, they frankly might be better served by a cable broadband service at those locations.
On the other hand, even at longer lengths and slower speeds, the single-line service is a compelling value: unlimited and uncapped broadband at the maximum speed that we can deliver plus home phone with unlimited usage for $39.95. It’s a very nice deal. Two lines for seventy dollars plus the applicable voice taxes just isn’t a very good fit, and it shows in the signup and churn numbers.
Based upon all of these findings, today we have reduced the Fusion service to two very simple products:
For Residential customers:
Unlimited broadband and home phone for $39.95
For Business customers:
Two phone lines plus double speed broadband for $89.95
Of course both of these products include all of our free features like FaxLine electronic fax, a free domain name with Personal Web Hosting, 15 email accounts, Free International calling, Voicemail and voice features like Caller ID.
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