Tuesday, March 27, 2007

Race to the bottom?

I came across this news in the business section of The Star concerning a new plan for the Digi Prepaid market.
This reminded me about an article on kennysia.com about prepaid wars. It didn't take long for me to google up the article which forwarded me to another website, called The truth about prepaid. Now, any idiot would instantly recognize from the colour of the website(yellow), and the repeated praises for Digi to recognise that the website is actually Digi's. More eveidence on kennysia's website.The truth is there are just so many plans out there and I really wonder if there's a need for such complications. It seems that the website hasn't been updated recently so I did a bit of research myself.

According to Celcom's website here, nothing much has changed but if the rates are definitely better if you are a Max Plan user.
As for Hotlink, the link here shows the current rate for both Easy Plan and Total Plan. It seems that nothing much has changed since the update on The Truth About Everything. Digi really has a better deal here in terms of rates. Now, bear in mind that with different prepaid companies, you could get different benefits, I heard that with Hotlink you could get good deals on concerts etc so there's more to this than meets the eye.
For some reason, I couldn't access Digi's website, due to it keep telling me to update to Adove Flash Player 8. I'm using Firefox 2 with Adobe Flash 9.0.31, so Digi, please fi the glitch. Or maybe you're just biased towards Windows users?

So where does this new "Fu-Yoh!" plan from Digi land us?
Segments and marketing head Loong Tuck Weng said under the new plan, SMS and MMS rates were reduced by 50% to seven sen and 25 sen respectively for calls across all networks. [Source: The Star]
Also,
From 12am to 12pm on Sundays, “Fu-Yoh!” prepaid subscribers only need to pay for the first three minutes and enjoy unlimited talk-time with other DiGi users. [Source: The Star]
I like the 2nd move more than the first one, reason being that most plans offer free SMS. Surely being "free" is more attractive than being "cheap" right? I however have a question about the discrimination policy by Digi, why only on Sundays? I know Sunday is the weekend but haven't anybody thought about states like Kedah or Kelantan where Friday is still the official weekend?

It seems that this prepaid war has become stagnant for quite sometime now. I personally don't think this is a good move to woo the youths, especially when you already have a huge youth subscriber base. It's just like reducing your income, isn't it?

A final catch,
Under the plan, subscribers pay a monthly fee of RM3, which is currently waived for two months from today. [Source: The Star]
Do you think RM3 is worth it for the discounts?

Back to our topic, do you think this is a race to the bottom for the prepaid wars? Do you think we have already hit rock bottom? I personally think so. We've absolutely hit rock bottom in terms of rate and the only thing one can do to increase market share is by introducing more benefits. So my conclusion is that this move by Digi is not a good move, and could be easily countered by rival companies. So Hotlink and Celcom(Telekom), please, the choice is yours.

On to a different story, this reminded me of a particular lecture I've seen in the past on Princeton's Public Lecture Series website. Here's the link to the video, Windows Media Player needed to view, 56K or 300K.
Robert W. Lucky, Telecordia: "Broadbanding America: What, Why, and How"
Take note of how he uses "Race to the Bottom" in the lecture.

Reference:
  1. The Truth About The Truth About Prepaid, kennysia, 21 December 2006.
  2. Digi unveils new prepaid plan for youth market, The Star, 27 March 2007.

2 comments:

cindy said...

Ya know, I think the DiGi's mascot (that stupid yellow fatty) is rather irritating! His suit are SO fake looking and his head looks weird. Can't they hire someone to make a better looking suit?

Bigbird from Sesame Street looks nicer! ;D

Boss Lepton said...

To be honest Cindy,

I think the DiGi mascot is a brilliant move by the company, go out and ask somebody on the street to name a company associated with the "yellow"

The answer will most certainly be DiGi, such a brilliant move to create a corporate identity.