By Andrew M. SeyboldLet me say this right up front -- whatever you pay for
broadband wireless access for your employees, it is worth every cent. The
return on investment (ROI) can be measured in weeks or months, not years.
Having access to information whenever it is needed provides
one of the most significant productivity increases available today. In fact,
wireless generally sells well during times of recession because it enables
customers to do more with less. For example, you can add wireless to your
service vehicles for better efficiency so you won't have to add another vehicle
or new employee.
Even though most of you have heard about increased
productivity and early returns on wireless data investments for years, you
still have to deal with the reality of your budgets and the amount of money you
have to spend on these types of services. This makes it important to buy smart
and to make sure that what you pay for wireless data services is the lowest it
Before looking at pricing for wireless data service, let's
consider the devices. First, PC Card and USB wireless modems are available for
little, if any, cost. These can be given to employees or kept in a pool and
signed out by those who travel infrequently.
The best bet, especially if it is time to buy new notebooks,
is to buy units that have built-in broadband data devices. These are available
in an increasing number of notebooks and now in netbooks, and there are two
types of embedded broadband devices.
One is wireless network-specific, e.g., it would work on
Verizon Wireless and Sprint but not on AT&T or T-Mobile, and vice versa.
The second is what I recommend to anyone buying new
notebooks or netbooks -- it is a Gobi chipset made by Qualcomm that is designed
to support both 3G standards and most of the frequencies in use around the
world, and it is showing up in more and more devices.
The advantages to you and your company are twofold:
can purchase the notebooks or netbooks knowing that you can change network
operators anytime you want to, without having to send the units back to have
their wireless modules swapped out.
matter what wireless network you are using in the United States, your employees
who travel internationally can make use of wireless broadband services in virtually
any country and, in many cases, not have to pay high data roaming charges.
Then, of course, there are smartphones. Whether they are
BlackBerrys, iPhones, Windows Mobile phones or any of the operating systems,
having a broadband connection to these devices will also be beneficial.
In general terms, however, equipping your outside people
with notebooks or netbooks will give them an experience that is closer to their
desktop systems, which will cut down on your support costs. In either case,
having access to wireless broadband without having to find a WiFi hotspot and
sign on in the clear is a much more secure way to connect back to the
corporation, and all of today's broadband providers support VPNs and other
What's It All Cost?
A year or so ago, most of the U.S. wireless industry changed
from all-you-can-eat data pricing to monthly fees based on the amount of data
consumed, with additional fees for every megabyte of data over the allocations.
According to AT&T's published prices (what a consumer
with one device will pay), for a BlackBerry, unlimited data services are $35.00
per month; if you want to use your BlackBerry as a modem for a notebook
(tethered), it will be $65.00 per month for 5 GB of data. Currently, AT&T
only offers consumers one plan for notebooks and netbooks, and that is $60 per
month for 5 GB of data.
Verizon Wireless prices data in a few different ways: 250 MB
of data per month will cost consumers $39.99 per month, or they could opt for
the 5 GB plan for $59.99 per month. BlackBerrys offered by
Verizon are only available in bundles of voice and data, and start at $79.99
per month up to $129 per month.
Sprint is about the same as the other two at 5 GB for $59.99
per month, or 300 MB per month when you are roaming off its network.
T-Mobile has some very confusing pricing. It says on its
website that for $39.95 per month you get unlimited data for
"Internet" access, but the line below that says if you want a
webConnect data plan, that will cost $59.95 for 5 GB of data.
None of the major carriers' sites provide pricing for
business customers, and all refer you to a B2B sales organization.
So, What Should You Pay?
The price you pay to meet your enterprise data requirements
depends on how many lines you need and how good a negotiator you are.
A greater number of lines typically means the lower your
individual monthly fees will be. As with any negotiations, the more you shop
your data requirements around, the better pricing you will find.
But the wireless network operators don't make it easy for
you to compare the various plans. You can negotiate for several different types
of plans, and this gets really interesting if you have notebooks or netbooks
with the Gobi chipset, since you will have the option of changing networks
quickly and easily.
You can get a monthly per-user contact, or a bucket of data
that can be used by everyone in the company, depending on which option results
in the best pricing. You will also want a price reduction guarantee, so that when
data price points drop, as all wireless pricing does, you will automatically
get the reduction.
There is a new way to purchase data services as well.
Verizon and Vodafone, for example, will sell 24 hours of data services for
about $12. This is a good way to buy for your organization's occasional
travelers, since you don't have to maintain a subscription for them. AND you
will save a lot of money when they travel overseas.
If your company has a contract with Verizon (EV-DO) and your
staff flies to London (Vodafone UMTS/HSPA), you can give the travelers a
Gobi-equipped notebook or a UMTS/HSPA device and they can purchase wireless
broadband services by the day, again, for around $12, and your company won't be
stuck with data roaming charges that can add up quickly.
As far as I know, Verizon and Vodafone are the only two
carriers offering this deal at the moment, but as you negotiate with the
network operators, you can request this service, and I believe it will become a
standard option for pricing data services.
Don't for a moment believe you can only deal with one
network operator at a time for your entire fleet. Sometimes it makes sense to
divide your business between two or more network operators. In some cases, each
of them will come back repeatedly trying to win the rest of your business, and
this will work to your advantage.
You should also ask about becoming a customer without a
one-year or two-year contract. Of course, the network operators don't like this
and will give you a hundred reasons why it is not a good idea, but if you have
a large enough company and they really want your business, you will be
surprised at what you can accomplish.
There is no set wireless broadband pricing for business
customers. It depends on the number of devices, the types of services you want,
and how good you are at telling them what you need. What should you be paying,
how much data bandwidth to you really need, and what the heck is 5 GB of data
To give you some perspective, based on discussions conducted
by Andrew Seybold, Inc., with IT executives representing several thousand
enterprise end users, it appears that most business executives use fewer than
80 MB of wireless data per month, field workers more. If you watch your
organization's data usage on a per-user basis, you can easily determine what
your averages will be.
By the way, if your users leave their notebooks connected
with Outlook running and don't even touch the keys for an hour, they will use
more than 1 MB of data--Outlook is a very chatty program.
The bottom line is that your organization should end up
paying less for your enterprise data than the carriers' advertised consumer
pricing. It is difficult to provide guidelines here, but the lowest pricing I
have seen for data is in the $20 per month per user range, while the average is
closer to $40 per month.
One trick you can use is to make your buy toward the end of
a quarter, when the network operators' sales forces are scrambling for new net
ads that can be reported at the end of that quarter. Wall Street rates network
operators on net-adds, churn, and Average Revenue Per User (ARPU), so if a
network is short on net adds, it is more likely to give you a better deal.
The best thing you can do is negotiate hard and make sure
the network operators know you could split your business and/or your employees
have equipment that can be used on any network. Keep the carriers on their toes
and your enterprise will reap the rewards.
Gartner Says Enterprises Overspending On Wireless Costs (And Reveals Where)
J.D. Power & Associates Rates Wireless Carriers
Andrew M. Seybold is President/CEO of consulting firm Andrew