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#109108 by syxbit
Mon Apr 22, 2013 8:34 am
Have any of you heard about Razer?
They accidentally had a 90% off coupon that was used by thousands and thousands of customers to purchase items FAR below cost.
They made a big press release announcing that they'd honour the coupon, as the massive losses are worth it when it comes to keeping their customers happy. It's also good publicity, and their customers will give them free 'word of mouth' advertising.
I think Ooma could learn a LOT from Razer. A LOT.
Many of us Hub owners would probably be willing to pay the cost of the Telo hardware, providing we were at least able to keep the old terms and conditions. I don't think this is an unreasonable expectations for existing customers.
Seriously Ooma, why can't you just do this? Sure you wouldn't collect the taxes, but you aren't collecting those from Hub owners now anyway. So what would change? Just customer happiness, and less legacy hardware to support! I know I'd be a lot happier, and would probably refer more customers to them.

Some companies get it, and some don't, but goodwill is worth losing a bit of money. It should come our of their marketing budget.
#109118 by holmes4
Mon Apr 22, 2013 9:57 am
It was actually their fulfillment house, Digital River, that made the goof. It would not astonish me if Digital River were made to pay for the mistake. It would astonish me if Razer was bearing the entire cost of this error.
#109855 by topwinder
Tue May 14, 2013 10:33 am
syxbit wrote:Many of us Hub owners would probably be willing to pay the cost of the Telo hardware, providing we were at least able to keep the old terms and conditions. I don't think this is an unreasonable expectations for existing customers.
Seriously Ooma, why can't you just do this? Sure you wouldn't collect the taxes, but you aren't collecting those from Hub owners now anyway. So what would change? Just customer happiness, and less legacy hardware to support! I know I'd be a lot happier, and would probably refer more customers to them.

Some companies get it, and some don't, but goodwill is worth losing a bit of money. It should come our of their marketing budget.


I would like to see Ooma offer an upgrade option while keeping current terms for old time Hub users. Yes, I have saved hundreds on my phone bill, but the telco's have found a way to stick it to the consumers regardless. What used to be a $20-25 Internet connection is now close to 40-45 (or more). Of course, if I go away from Ooma, I pay the 40-45 PLUS additional for (psuedo) POTS (it is almost always VOIP solution now).

I am happy that Ooma continues to pay for the taxes, but should they offer me a new hardware while keeping current terms? As a a consumer the answer is definitely a resounding "yeah!", but if I work for Ooma, my answer would not be so clear cut.

Ooma sold the free service assuming that hardware will fail at some point, and people would buy newer hardware to replace. At $250 retail, Ooma made money from the device to fund their operating costs. If the MTBF is around 4-5 years, comparing to magic jack's $20 a year fees, Ooma would still come out ahead assuming a wholesale pricing of about 150-200 or so.

Of course Ooma did not account for a bean counters deciding that Ooma should pay the local taxes (probably because some designation changed, not all SIP/VOIP providers pay local taxes). Not unlike Razer, Ooma worried about goodwill and, absorbed the local taxes for people who bought when Ooma advertised "$0 bill". With about $4 tax bill, Ooma decided to give away the service for free and pay the taxes, hoping that MTBF will help them with their taxes ($250 can still pay for about 5 years of taxes).

If Ooma offers us a Telo upgrade without altering the plan, their assumptions on MTBF goes awry, and they now, not just have to give you free service, but also pay the taxes for additional 5 years (assuming MTBF of Telo are also 5 years) out of just the $100 they get by giving you the new hardware. So Ooma swings from a small loss (or just about even) on every core customer still out there, to making actual loss on every Telo upgrade.

Unlike before, the $99 deals are very common (sometimes even less), Ooma is not making much out of selling the device to fund its operations, so I wonder whether Ooma is making enough through premium service to keep itself afloat.

Of course, I have no background in economy, and dont even play the role of an economist on TV, so I might be wrong about the model that Ooma worked out to become profitable.


Does anyone know if Ooma charges taxes and FUSF fees on the international $10 calling plans? If so, what is the actual cost for the $10 plan?
#109856 by lbmofo
Tue May 14, 2013 10:57 am
topwinder wrote:Does anyone know if Ooma charges taxes and FUSF fees on the international $10 calling plans? If so, what is the actual cost for the $10 plan?

Federal Universal Service Charge is added and sales tax for WA and CA if you are in those states (the list might have grown).
Federal Universal Service Charge is roughly a buck (been ranging from $1.01 to $1.17 and seems to change every 3 months).

As far as earlier Ooma business model, in this post: /viewtopic.php?f=5&t=10941&start=40#p79257
There is a link to a piece on Ooma business model; perhaps, that will give you some more insight.
#109860 by topwinder
Tue May 14, 2013 1:03 pm
lbmofo wrote:
topwinder wrote:Does anyone know if Ooma charges taxes and FUSF fees on the international $10 calling plans? If so, what is the actual cost for the $10 plan?

Federal Universal Service Charge is added and sales tax for WA and CA if you are in those states (the list might have grown).
Federal Universal Service Charge is roughly a buck (been ranging from $1.01 to $1.17 and seems to change every 3 months).

As far as earlier Ooma business model, in this post: /viewtopic.php?f=5&t=10941&start=40#p79257
There is a link to a piece on Ooma business model; perhaps, that will give you some more insight.


Thanks for the info. Hmm, So with sales taxes etc, the $10 is likely to become $12+ in Silicon Valley region. I think Ooma could do better on the pricing on the international calls and make some more money, although doing so is probably going to be more of an headache for it.

I currently buy a "rechargeable" phone card, that gives me 500 minutes for $10 (no expiry) which lasts me about 4-6 weeks, it doesn't charge any FUSF or sales tax. That is the deal Ooma should try to beat (there are better deals, but I stick with this plan because is one of the more stable deals, and fits well with my cost/reliability metrics). The monthly $10 (plus the added taxes) doesn't make it a great deal for most cost enlightened folks.
#109863 by lbmofo
Tue May 14, 2013 1:38 pm
topwinder wrote:I currently buy a "rechargeable" phone card, that gives me 500 minutes for $10 (no expiry) which lasts me about 4-6 weeks, it doesn't charge any FUSF or sales tax. That is the deal Ooma should try to beat (there are better deals, but I stick with this plan because is one of the more stable deals, and fits well with my cost/reliability metrics). The monthly $10 (plus the added taxes) doesn't make it a great deal for most cost enlightened folks.

500 minutes to where? Can't be 500 minutes to all destinations. It really depends on what you want. I know a friend with Ooma 1000 plan because they call one of the included destinations a lot. If you dial these destinations close to or even over 1000 minutes month after month, Ooma deal is great (can't beat ~1 cent a minute; especially if calling included destinations that customarily cost a lot with calling cards; Bahrain for example).

My friend calls one of the more common and cheaper destinations and he doesn't even come close to 1000 minutes a month but he chooses to stay with the Ooma plan because he likes the convenience of direct dialing. I have another friend who doesn't have the Ooma 1000 plan but uses Ooma prepaid account because he also likes the direct dialing. He is very happy because he used to pay 3 times as much for international calls when he was with Comcast digital voice. It all depends on perspective and needs.

With folks who seldom make international calls, I suppose calling cards could be the answer (but lots of work finding ones that don't charge monthly maitenance fee, don't charge connection fee, don't expire, don't charge you arm/leg for calling destinations not specialized by the card). Tell you the truth, it is a wonder why these calling card companies are still in business given GV is out there. I mean I still see domestic long distance calling cards on sale in Costco? Are folks that uninformed?

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