8×8 Thinks $99 is Great
An intriguing exercise is trying to read into 8×8 Inc.'s decision to keep the price of its Packet8 VideoPhone at at $99 following a promotional program. 8×8 said the decision is prompted by “favorable consumer demand” to a plan that is part a $19.95 a month, two-year service contract. The key question is how much of a hardware subsidy 8×8 is offering to attract consumers. The company believes the two-year contract concept is the right way to go given its success in the wireless phone business. Maybe this is the right way to go for 8×8, which was recently rated as offering the highest quality VOIP service. With competition mounting from all sides, 8×8 needs a competitive edge to stay viable. Otherwise, it will be destined to be a niche player - if it already isn't.
