It Now Costs Providers Less to Deliver Network Services – But Are Those Savings Being Passed On to You?

By Matt West

Director of Telecommunication Services, NPI

August 03, 2015

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Artwork Courtesy of ©iStock.com/Meriel Jane Waissman

We talk about “beware of the bundle” quite a bit on this blog, and for good reason. One example I’ve referenced in the past is the cost of storage provided as part of bundled services. In most cases, the cost of services such as network backup/archive that incorporate storage do not necessarily reflect the spiraling downward trend of storage pricing.

The same situation applies to the cost of underlying network services. In the example of backup and archive services, whether this is done via a dedicated circuit or over the public internet, the cost of the underlying network is nearly half of what it was 3 to 5 years ago. Has that savings been passed along in the cost of the bundled service?

The same goes for telematics. Most in-cab telematics for fleet management and field service are bundled to include the wireless network communications. The underlying cost of those wireless services are only a third of what they were 3 to 5 years ago. Has the reduced cost of delivering the service been passed along in the bundled cost?

In all of the examples above, the answer is typically no. While it’s gotten cheaper for service providers to deliver their network services, the savings are not being passed on to the customer automatically. That’s a whole lot of extra, easy headroom that can be negotiated out of your contract if you have the right pricing intelligence.