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Web Ballot
Ballot D-050827

INTERNET SERVICES
Proposed Rate Changes

BACKGROUND:
In June, 2004, the Board set a "value" for each GREENBELT.COM service element in consideration of the unbundled cost of that element:

ServiceCostValue
Dial-up (cost based on 50
subscriber minimum)
~$5$8
Mailbox (10 MB)$0$3
Website (5 MB)$0$2
Additional Mailbox (10 MB)$0$2
Additional Webspace (5 MB)$0$2

These values were then combined and priced into four basic service packages, with each package required to include one mailbox:

PackageCostPrice
Full Service:
Dial-up/Website/Mailbox
~$5$13
Dial-up Service:
Dial-up/Mailbox
~$5$11
Website Hosting:
Website/Mailbox
$0$5
Mailbox Only:
Mailbox
$0$3
Additional Mailbox (10 MB)$0$2
Additional Webspace (5 MB)$0$2

RATIONALE:
Since these prices were put into effect in July, 2004, at least two considerations have changed:

  1. We now have the benefit of experience as many former Full Service subscribers have migrated to broadband service.

  2. The competitive market for Internet services has evolved.
With respect to Consideration 1, since our unbundling transition only 4 of ~11 Full Service subscribers who moved to broadband (and who did not leave town) have retained their GREENBELT.COM mailboxes. It seems apparent that, despite their long term investment in a Greenbelt address, the decision by most people to drop the mailbox was based solely on cost. The cost of broadband service has been, after all, considerably higher than dial-up during the past year, and the faster service does include at least one mailbox (usually several) and an equal or greater amount of webspace. Three dollars a month is a lot to pay just to hang on to an e-mail address. It's very possible that even those long-term subscribers who did keep their Greenbelt e-mail address were motivated more by some level of loyalty to the Cooperative than by cost considerations alone.

With respect to Consideration 2, many dial-up service offerings are available today at prices extremely competitive to those of GREENBELT.COM. Check it out yourself -- who do you think are all the other customers of dial-up providers like IKANO and GlobalPOPs? Here's one I see advertised on my TV screen every day: PeoplePC Online for $10.95. Like our own, the service area of most of these dial-up ISPs is national in scope.

The broadband service market is also very competitive today with smaller providers trying to penetrate the market share of Verizon and Comcast, sometimes offering introductory prices that seriously threaten dial-up services. Verizon DSL for $14.95 is not yet available in our area, but you can bet it won't be long.

Most of these inexpensive dial-up and broadband connection services include bundled e-mail and/or webspace services at no extra cost. Nor is GIAC unique in offering month-to-month, uncommited service. We have spoken often about the special local value of the name GREENBELT.COM in our service offerings, but for folks whose first consideration is cost, the cachet of the hometown name only goes so far.

I am proposing two changes, both calculated to make acquiring or keeping GREENBELT.COM e-mail addresses more appealing.

The first proposal is to lower the price of the first mailbox from $3.00 to $2.00. If we can afford it, I'd prefer to reduce the "value" portion of that first mailbox in all of our basic service packages, producing this scenario:

PackageCostPrice
Full Service:
Dial-up/Website/Mailbox
~$5$12
Dial-up Service:
Dial-up/Mailbox
~$5$10
Website Hosting:
Website/Mailbox
$0$4
Mailbox Only:
Mailbox
$0$2
Additional Mailbox (10 MB)$0$2
Additional Webspace (5 MB)$0$2

Besides beating out PeoplePC by $0.95 for basic dial-up service and one mailbox, for GIAC old-timers like me there is an admittedly emotional appeal to the scenario above because it returns the Full Service rate to its initial 1996 level:  $12.00/month! Wouldn't that be something? We could get all kinds of advertising mileage out of that situation GIAC SLASHES PRICES TO 1996 LEVELS!   RIDE THE GIAC TIME MACHINE!   LABOR DAY SALE! , etc. :-)
I do hope we can put this change into effect by Information Day . . . to provide that chance, I am shortening the voting deadline on this ballot by one day.

However, if an across the board reduction of $1.00 is deemed too expensive to our cash flow picture, I'd still like to lower the mailbox "value" by $1.00 in all the packages and increase the dial-up "value" by $1.00, producing this scenario having much less cash flow impact:

PackageCostPrice
Full Service:
Dial-up/Website/Mailbox
~$5$13
Dial-up Service:
Dial-up/Mailbox
~$5$11
Website Hosting:
Website/Mailbox
$0$4
Mailbox Only:
Mailbox
$0$2
Additional Mailbox (10 MB)$0$2
Additional Webspace (5 MB)$0$2

The important element in both variations of the first proposal is to reduce the price of the first mailbox, which I think is conspicuously too expensive when it stands alone.

The second proposal, which I believe is even more necessary in order to retain at least some revenue from subscribers who move to broadband, is to lower the price of an auto-forwarded GREENBELT.COM address from $3.00 to $1.00. It's silly to expect very many people to pay $3.00 a month for a mailbox that doesn't even exist. But we can justify and market the auto-forward rate to departing subscribers on the basis of anti-virus and anti-spam services, plus the all-important GREENBELT.COM cachet that many people may not want to lose.

I hope you will share my enthusiasm for these changes and that we will have even more exciting news to tell folks on Information Day!

Neil McLeod


Proposal 1
Proposal:
Reduce the mailbox rate from $3 to $2.

  • OPTION 1:  Reduce the mailbox rate in all basic service packages.
  • OPTION 2:  Reduce the mailbox rate in the Website Hosting and Mailbox Only packages.
  • OPTION 3:  Don't change the mailbox rate.

    VOTING SUMMARY

    OPTION 1  Peggy Bates, Phil Brandis, Mary Camp, Ed James, Neil McLeod  
    OPTION 2   
    OPTION 3   
    ABSTAIN   
    ABSENT  Anne Andersen  
    SpacerSpacer

    Proposal 1 Option 1 is approved.


    Proposal 2
    Proposal:
    Reduce the auto-forward rate from $3 to $1.

    VOTING SUMMARY

    YES  Peggy Bates, Phil Brandis, Mary Camp, Ed James, Neil McLeod  
    NO   
    ABSTAIN   
    ABSENT  Anne Andersen  
    SpacerSpacer

    Proposal 2 is approved.

    Voting deadline for this ballot:
    Send any questions to: Director Neil McLeod

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