In an article for TMCnet.com yesterday, our own Johanne Torres reported on Comcast’s announcement that the company will launch an Internet telephony service by the end of this year. According to Johanne, Comcast is targeting residential customers with what seems to be the priciest of all VoIP-enabled calling service plans.
It’s interesting to me that VoIP remains extremely price-sensitive. Or rather that people remain very sensitive to VoIP's pricing. I mean, price is always the first thing people notice about VoIP. “It’s cheaper than regular phone service,” they say. “It’s a less expensive alternative.”
Maybe I’m jaded, or maybe I’m just too deep in the VoIP forest to notice any trees, but to me VoIP is about more than just lower prices. I have always maintained since we launched Internet Telephony magazine in 1998 that the real benefits of VoIP are all the potential services that are enabled by the technology. In the enterprise space, those services and applications are easier to identify. For the consumer market, it gets a bit cloudier, and perhaps that is why the conversation always comes back to price. And without getting into it here and now, the standard services being offered by almost every VoIP provider are already miles ahead of what people were used to with standard POTS.
Comcast is clearly asking more for their VoIP service that the competition. However, they are also offering more, and they will promote their service not as an alternative to the Packet 8’s and Vonage’s of the world, but rather as an alternative to the more traditional phone companies. And if Comcast is able to advance their offering as “service heavy,” then it is worth the premium.
Let’s be honest. I’m sure that the company that has been trialing VoIP to its customers since as far back as 2002 has also taken some time to do a little market research. If their customers feel comfortable buying voice from their cable provider, if they feel a benefit from paying a single bill (as opposed to writing multiple checks each month to multiple providers, in multiple envelopes…), if Comcast can convince the market that they can deliver a higher level of service quality and reliability, then people will pay more.
Other VoIP plans may be cheaper, but Comcast, by pursuing a slightly higher price may be setting up on the right side of an age-old argument: At the end of the day, many people truly believe that in life, you get what you pay for.