Blogsberger's Box

I can no longer recommend Mozy as an online backup solution for home users.

It will be interesting to watch how this unfolds.

The decision makers at EMC may not have factored in the total costs when making their decision to increase their prices and eliminate the unlimited backup that had been a feature of Mozy since the product was launched.

Their weak argument for the price increase - 'more folks are backing up photos and videos' - sure doesn't ring true in an environment of exponentially decreasing storage costs and increasing bandwidth -- I can stream all the Netflix movies I want over my home internet connection for $7 per month, and buy a 2TB drive for less than $100 bucks -- unheard of when Mozy was launched several years ago.

Certainly the direct revenue hit from losing a bunch of consumer / end-user accounts at $5/month isn't a big deal for a company the size of EMC.

But, the loss of goodwill and likely ill will it creates may well ripple into business-to-business purchasing decisions - a disgruntled current home user who has some impact on purchasing decisions for their business may think twice about EMCs tactics - and that may end up costing the EMC corporate sales folks thousands in a lost initial sale, and thousands more in the follow-on annual maintenance contracts.

And, the lost opportunity for EMC to capture new users (e.g. students, recent grads) and introduce them to the EMC product family may have further costs in lost revenue down the line.

The impact of a business-level price increase is different than a consumer product price increase -- we holler more and take it personally when it hits our own wallets. Marketing 'fluff' about new features doesn't carry much weight when there's no choice but paying more.

Can anyone think of an example of a successful 20%+ price increase on a consumer type of product in the high tech world?