Time for a Dennis Miller style rant today. The pricing of web conferencing and associated audio conferencing is insane and somebody has got to figure out a better strategy. I'm not talking about prices being too high... Heck, we all want more for less. And honestly, if you shop around there are some extremely reasonable rates available. No, I'm talking about the pricing methodology employed by most of the vendors.
When I work with clients who are just getting their feet wet with web conferencing, one of the first things they ask me is "How much will it cost?" And you know what? I have no idea! That's because the vendors have no idea. Most of the major vendors price on a per-seat basis, which is similar to banquet caterers pricing a hosted dinner based on the number of people served. All fine and well, except that a public webinar with open registration (typically used for general marketing purposes) doesn't have a set number of attendees. You promote the heck out of it and hope you get a large number of registrants. Then you hope that a significant percentage of them actually show up. If you are wondering, attendance rates these days are averaging somewhere around 30% of registration numbers. And some of your attendees will drop out after a short time.
Some web conferencing providers will charge you x amount per registrant, plus n amount per attendee with a minimum number of each committed to as a base rate. Then you pay an "overage" fee for each registrant or attendee over your basic commitment. If you commit to more people in your base, your price per person drops. This makes you play a guessing game as to how many people you are likely to get, raising your base commitment to reduce your overage charges. I hate this kind of gambling.
Then we get the even more fascinating pricing of associated audio for your event. If you use Voice Over Internet Protocol (VOIP) – that means sound coming out of the attendees' computer speakers – the pricing is usually flat rate per person. But if you are using telephone lines, watch out! You will pay different rates based on the types of services you use. Operator-assisted costs more than automated connection. Private audio areas for the speakers (often known as "green room" from the television industry's name for a guest waiting area) cost extra. Toll free numbers for in-state, US-wide, and North America are different. And then we get into the exciting area of international events. This is where it truly gets crazy. If you want to market to an international audience, you need to remove barriers to attendance. This means giving them local toll free numbers to dial into. Few people in Finland want to pay for a one-hour call to the US to hear you pitch your product. Most audio conferencing companies ask you to identify every country you will get calls from, estimate how many people will call from that country, and then quote you a per-person rate for that country. Forget reliable pre-event cost estimates... it's a complete roll of the dice. I did find one audio company that was willing to quote a reasonable flat rate for calls coming in from ANY European country with no pre-estimates needed and established toll-free numbers for all the countries. That was a major discovery I am proud of.
There are other means of pricing that involve campaign pricing (a bundled fee for multiple events), package pricing for a single event, and unlimited use contracts for large monthly fees (typically only appropriate for very large companies doing many events). And a few vendors sell their software and hardware outright so you can do what you want with it. I have also been successful at getting some vendors to work a "loss leader" deal that package-prices an event purely as a way to steal business from their competition. These guys have a lot of wiggle room in their quoted prices, and it's worth some negotiations to try to work a better deal. Resellers will sometimes undercut the main vendor on the pricing, taking a smaller percentage markup over the base wholesale cost in order to get the business.
It's a mess and a muddle and a headache for event managers trying to work out a real budget for their bosses to approve. Some vendor is eventually going to figure out a better pricing strategy that fixes costs or makes them understandable without an advanced mathematics degree and they are going to find themselves very attractive to the market!