Brian Roy’s Blog

Verizon Jacks SMS Rates

Friday, October 10th, 2008 | Analysis | Comments

I use - as does cosinity - SMS for a variety of communications. This morning - my SMS service provider Clickatell - notified me this morning that Verizon had decided to charge an additional 3 cents each for SMS sent from an “application”.

That means the average SMS sent to a Verizon user will cost between 5 and 7 cents.

Obviously this is highway robbery and completely unjustified. As has been pointed out hundreds of times - SMS is the lowest network usage and network cost to a provider - so this has nothing to do with increasing costs, it is pure profit.

If this isn’t reversed I’ll be forced to discontinue SMS services for Verizon Wireless users.

I’ve included the email below.

Dear Brian , Alert: US Carrier - Verizon Pricing Increase announced (October 8, 2008) Please be advised that US carrier Verizon Wireless has announced that they will be charging an additional 3c per SMS for all application originated mobile terminated messaging beginning November 1, 2008. This increase will apply to standard rate and premium programs only through the Verizon Wireless network. Transaction fees will not apply to Free-2-End-User, Mobile Giving or Non-Profit organizational programs, according to Verizon. In addition, it has been reported that Verizon Wireless customers are no longer receiving a delivery confirmation notice after sending SMS messages - a long-time standard SMS service feature popular with subscribers and available on other carrier networks. As your trusted partner and the voice of over 8,000 Clickatell customers to the wireless carrier industry; we believe these sudden and significant pricing and service changes made by Verizon are detrimental to the mobile industry as a whole. In response, we are working with several partners and industry leaders to strongly voice our concerns about the impact these abrupt changes from Verizon will have on the entire messaging industry. Additionally, we are working to obtain more information on specific policy details and timelines. Unfortunately, Verizon Wireless has provided little in the way of an explanation as to the reasons behind these announcements and abrupt changes. At this time, your Clickatell account representative and our support centre will not have much more information to share about the reasons behind these changes. However, please be assured that we value your business and know that we are doing everything reasonable and within our power to influence Verizons’ decision as we understand the impact this may have to you, our customer. For more information on pricing changes please refer to your Clickatell agreement and/ or our standard terms and conditions: http://www.clickatell.com/company/terms.php Yours sincerely, Clickatell Carrier Relations Tel: +27 21 910 7700 Fax: +27 21 910 7701 www.clickatell.com

Tags: customer experience, value and price

More articles predicting doom for startups

Thursday, October 9th, 2008 | AZ Tech, Analysis, The Future | Comments

I feel like the grim reaper here… really I’m not throwing myself out a window.

So why am I posting these? it is important for entrepreneurs to NOT bury their heads in the sand.

I would also take a moment to point out that the majority of this news is coming from Silicon Valley - by far the easiest place to raise capital. If you are not based in Silicon Valley the news is probably worse.

The important thing is not to panic and plot a course of action TODAY - What should you do - you can start by reading Ron Conway’s letter to the companies he has invested in. I’m following this advice - and you should too.

Sorry, Startups: Party’s Over - Silicon Alley Insider

Sequoia Capital, best known during this bubble as the guys who backed YouTube, gathered some of their startups Tuesday for an emergency meeting. “The attendees were greeted by a cute image of a Grave Stone, with a message: R.I.P.: Good Times,” Om Malik reports.

Super Angel Ron Conway To Would-Be Startups: Don’t Quit Your Day Jobs - Silicon Alley Insider

Different story, says Ron Conway, who is perhaps the most famous angel investor in tech these days. Ron is best known for making very early and very lucrative bets on Google and PayPal, but he’s also known as one of the most adventurous angels of Bubble 2.0, and has invested in 130 companies since 2005. We asked him for his advice to would-be-startups last night, and he wasn’t nearly as encouraging:

“I would tell (entrepreneurs) to keep their day job until they got one year of funding, and if they couldn’t get that, then they’re not meant to start that company right now…. My advice to (start ups that don’t have a year’s worth of money in the bank) would be to raise money by reducing your own spending. If you can’t raise more money, you have to cut costs. And that’s what I’m harping on to my companies.”

Fred Wilson: My Thoughts On ‘Startup Depression’- Silicon Alley Insider

All startups are going to have to batten down the hatches, get leaner, and work to get profitable, but the venture backed startups are going to get more time to get through this process than those that are not venture backed. Here’s why.

Venture capital firms are largely flush with capital from sources that are mostly rock solid. If you look back at the last market downturn, most venture capital firms did not lose their funding sources (we did at Flatiron but that’s a different story). If you are an entrepreneur that is backed by a well established venture capital firm, or ideally a syndicate of well established venture capital firms, then you have investors who have the capacity to support your business for at least 3-5 years (for most companies).

Tags: Angel Investors, AZ Tech, funding, innovator

Another solution to avoid Automated Call Hell

Friday, August 29th, 2008 | Analysis | Comments

There have been many of these over the last few years… none all that successful. The problem (as I see it) is that you don’t know when or why you’ll need to call one of those annoying toll free numbers… and at that point it is too late for the application/service.
That being said… as someone who worked with Fortune 500 companies building those annoying IVR (interactive voice response) systems - I have to ask… when will you learn? They should be for the customer - they should offer what the customer wants and needs, not what you want them to do. The problem is the standard IVR pushes what the company wants you to do and hides what you really want to do…
It is simply poor design. What I’d love to hear about is the companies that have really well designed VUI(s) (Voice User Interfaces) that their customers love to use. Or, is that simply not possible using voice?

Add this to your list of must have iPhone applications. Direct Line (iTunes link) is a service that helps you automatically navigate phone trees to get right to an operator (exactly what companies don’t want you to do).

Install the application, browse of search the included companies, and select the one you want. Direct Line then calls the number and preselects the appropriate choices to get you to an actual person.

The service operates much like Bringo, which we wrote about in 2007, but since it works directly from your iPhone it saves you the extra steps. In my testing it mostly worked, although it failed to get me through to operators at two companies (Air Canada and AT&T). No worries, though. Just send creator Michael Schneider an email at support@thisistech.com and he’ll update the database.

It’s well worth the $0.99. Direct Line joins DataCase on my list of must have productivity apps for the iPhone.

[From Direct Line Saves iPhone Users From Automated Call Hell]

Tags: customer experience, ivr

Club E Network planning an AZ business incubator.

Sunday, August 3rd, 2008 | Analysis, Regulation, The Future | Comments

Good news for AZ entrepreneurs. I’m of the opinion that there is far more talent in AZ and Phoenix in particular than we get credit for. Being a 12 year Silicon Valley veteran I’ve seen the talent in both locations, and while there is little doubt that the talent in SV is far more start-up inclined I think that is - in large part - due to the availability of resources - capital in particular. The result is that in SV everyone thinks they can form a startup… in AZ very few will even give it a shot.

For those of us in AZ bootstrapping a start up is the only practical option - any option for early capital usually comes with onerous strings attached - such as the acquisition of a large share of ownership by the VC/Angel or the proviso that the company re-locate to (you guessed it) Silicon Valley.

This causes two things we can not have:

1. Potential entrepreneurs leave AZ for SV because “that is where you have to be to start a tech company”.
2. Once an entrepreneur has an idea the act of seeking the initial capital to make the idea reality will often lead them out of AZ.

I have been lucky enough to have the means to provide my own initial capital investments in cosinity (bootstrapping the initial phase), but I too will soon be beginning a search for capital in earnest… I sincerely hope it does not cause me to leave AZ with my startup.

More resources like the one below will hopefully begin to reverse the trend.

The Club E Network, the entrepreneurs organization founded by Michael Gerber and Peter Burns, is planning to open a business incubator that would provide small-business owners with work space, office equipment, business services and other resources.

The Entrepreneur Factory, or eFactory, would also serve as Club E’s headquarters. The organization is currently scoping out potential locations, according to a post on Club E’s site.

Club E has expanded significantly since its founding in early 2007. The organization has multiple chapters in the Valley and in Austin, Denver and Washington, D.C.

The chapters meet monthly and are open to students and experienced business owners.

[From Entrepreneur network planning a business incubator]

Tags: AZ Tech

TechCrunch - VC Deals In Charts (Q2 2008)

Saturday, July 19th, 2008 | Analysis, The Future | Comments

Interesting data from TechCrunch today on VC investments for Q2 of 2008.

The venture capital market still appears healthy even with the general slowdown of the economy. One upside of what we are seeing is - as more Fortune 1000 companies “trim the fat” (which usually means shipping out high pay/long term employees) we’ll see an influx of new entrepreneurs into the marketplace.

You can count me on that list.

TechCrunch goodness after the jump:

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